Stability in Online Assignment Games

Emile Martinez, Felipe Garrido-Lucero, Umberto Grandi

Keywords: Online Matching, Assignment Game, Optimality, Stability

TL;DR: We design a framework to measure the stability of sub-optimal matchings with transferabe utility and apply it to online assignment games

Abstract: The assignment game models a housing market where buyers and sellers are matched, and transaction prices are set so that the resulting allocation is stable. Shapley and Shubik showed that every stable allocation is necessarily built on a maximum social welfare matching. In practice, however, stable allocations are rarely attainable, as matchings are often sub-optimal, particularly in online settings where agents arrive sequentially. In this paper, we introduce and compare two complementary measures of instability for allocations with sub-optimal matchings, establish their connections to the optimality ratio of the underlying matching, and use this framework to study the stability performances of randomized algorithms in online assignment games.

Area: Game Theory and Economic Paradigms (GTEP)

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Submission Number: 459