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Matching with Nonexclusive Contracts

Author

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  • Daniel Ripperger-Suhler

    (U.S. Bureau of Economic Analysis, 4600 Silver Hill Road, Suitland, MD 20746, USA)

Abstract

A variety of empirical papers document the coexistence of exclusive and nonexclusive contracts within a given market across a multitude of industries. However, the theoretical literature has not been able to generate a differentiable model with the coexistence of these contracts. I rectify the gap in the literature by developing a theoretical model of two-sided matching, in which principals and agents choose between exclusive and nonexclusive contracts with cost-of-effort inefficiencies. I find that the coexistence of contracts relies on cost-sharing between principals, relative bargaining power, and an endogenous outside option. I also find that the pattern of contracts is monotonic with respect to the type distributions of principals and agents.

Suggested Citation

  • Daniel Ripperger-Suhler, 2024. "Matching with Nonexclusive Contracts," Games, MDPI, vol. 15(2), pages 1-39, March.
    • Handle: RePEc:gam:jgames:v:15:y:2024:i:2:p:11-:d:1367616
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    References listed on IDEAS

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