IDEAS home Printed from https://ideas.repec.org/a/eee/gamebe/v90y2015icp17-43.html
   My bibliography  Save this article

Decentralized matching and social segregation

Author

Listed:
  • Chen, Yan
  • Fehr, Ernst
  • Fischbacher, Urs
  • Morgan, Peter

Abstract

Social segregation is a ubiquitous feature of human life. People segregate along the lines of income, religion, ethnicity, language, and other characteristics. This study provides the first experimental examination of decentralized matching with search frictions and institutionalized segregation. The findings indicate that, without a segregation institution, high types over-segregate relative to the equilibrium prediction. We observe segregation attempts even when equilibrium suggests that everyone should accept everyone else. In the presence of a segregation institution, we find that, while the symmetric segregation institution increases matching success rate and efficiency in one environment, it has weak or no effect in a steep-incentive environment. By adding an entry cost to a flat-incentive market, however, the asymmetric segregation institution leads to an increased matching success rate and efficiency in both environments, which underscores the importance of a coordination device.

Suggested Citation

  • Chen, Yan & Fehr, Ernst & Fischbacher, Urs & Morgan, Peter, 2015. "Decentralized matching and social segregation," Games and Economic Behavior, Elsevier, vol. 90(C), pages 17-43.
    • Handle: RePEc:eee:gamebe:v:90:y:2015:i:c:p:17-43
    DOI: 10.1016/j.geb.2014.11.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0899825615000032
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.geb.2014.11.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Linda Y. Wong, 2003. "Structural Estimation of Marriage Models," Journal of Labor Economics, University of Chicago Press, vol. 21(3), pages 699-728, July.
    2. Eeckhout, Jan, 1999. "Bilateral Search and Vertical Heterogeneity," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(4), pages 869-887, November.
    3. Cason, Timothy N. & Friedman, Daniel, 2003. "Buyer search and price dispersion: a laboratory study," Journal of Economic Theory, Elsevier, vol. 112(2), pages 232-260, October.
    4. Dale T. Mortensen, 1982. "The Matching Process as a Noncooperative Bargaining Game," NBER Chapters, in: The Economics of Information and Uncertainty, pages 233-258, National Bureau of Economic Research, Inc.
    5. Bloch, Francis & Ryder, Harl, 2000. "Two-Sided Search, Marriages, and Matchmakers," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(1), pages 93-115, February.
    6. Haruvy, Ernan & Roth, Alvin E. & Unver, M. Utku, 2006. "The dynamics of law clerk matching: An experimental and computational investigation of proposals for reform of the market," Journal of Economic Dynamics and Control, Elsevier, vol. 30(3), pages 457-486, March.
    7. Diamond, Peter A, 1982. "Aggregate Demand Management in Search Equilibrium," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 881-894, October.
    8. Nalbantian, Haig R & Schotter, Andrew, 1995. "Matching and Efficiency in the Baseball Free-Agent System: An Experimental Examination," Journal of Labor Economics, University of Chicago Press, vol. 13(1), pages 1-31, January.
    9. Timothy N. Cason & Charles Noussair, 2007. "A Market With Frictions In The Matching Process: An Experimental Study," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(2), pages 665-691, May.
    10. Greiner, Ben, 2004. "An Online Recruitment System for Economic Experiments," MPRA Paper 13513, University Library of Munich, Germany.
    11. Yan Chen & Tayfun Sönmez, 2002. "Improving Efficiency of On-Campus Housing: An Experimental Study," American Economic Review, American Economic Association, vol. 92(5), pages 1669-1686, December.
    12. Lones Smith, 2006. "The Marriage Model with Search Frictions," Journal of Political Economy, University of Chicago Press, vol. 114(6), pages 1124-1146, December.
    13. Chade, Hector, 2001. "Two-sided search and perfect segregation with fixed search costs," Mathematical Social Sciences, Elsevier, vol. 42(1), pages 31-51, July.
    14. Ken Burdett & Melvyn G. Coles, 1997. "Marriage and Class," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 141-168.
    15. Muriel Niederle & Alvin E. Roth, 2009. "Market Culture: How Rules Governing Exploding Offers Affect Market Performance," American Economic Journal: Microeconomics, American Economic Association, vol. 1(2), pages 199-219, August.
    16. John H. Kagel & Alvin E. Roth, 2000. "The Dynamics of Reorganization in Matching Markets: A Laboratory Experiment Motivated by a Natural Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(1), pages 201-235.
    17. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-846, July-Aug..
    18. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 10(2), pages 171-178, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marie-Pierre Dargnies & Rustamdjan Hakimov & Dorothea Kübler, 2019. "Self-Confidence and Unraveling in Matching Markets," Management Science, INFORMS, vol. 65(12), pages 5603-5618, December.
    2. Bernard, Mark & Hett, Florian & Mechtel, Mario, 2016. "Social identity and social free-riding," European Economic Review, Elsevier, vol. 90(C), pages 4-17.
    3. Thomas Gall & Xiaocheng Hu & Michael Vlassopoulos, 2019. "Dynamic incentive effects of assignment mechanisms: Experimental evidence," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 28(4), pages 687-712, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nöldeke, Georg & Tröger, Thomas, 2009. "Matching Heterogeneous Agents with a Linear Search Technology," Bonn Econ Discussion Papers 1/2009, University of Bonn, Bonn Graduate School of Economics (BGSE).
    2. Hector Chade & Gustavo Ventura, 2005. "Income Taxation and Marital Decisions," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 8(3), pages 565-599, Juky.
    3. Ran Abramitzky & Adeline Delavande & Luis Vasconcelos, 2011. "Marrying Up: The Role of Sex Ratio in Assortative Matching," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 124-157, July.
    4. Pais, Joana & Pintér, Ágnes, 2008. "School choice and information: An experimental study on matching mechanisms," Games and Economic Behavior, Elsevier, vol. 64(1), pages 303-328, September.
    5. Xu, Yujing & Yang, Huanxing, 2019. "Targeted search with horizontal differentiation in the marriage market," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 31-62.
    6. Hector Chade & Gustavo Ventura, 2002. "Taxes and Marriage: A Two-Sided Search Analysis," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(3), pages 955-986, August.
    7. Charness, Gary & Kuhn, Peter, 2011. "Lab Labor: What Can Labor Economists Learn from the Lab?," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 3, pages 229-330, Elsevier.
    8. Stephan Lauermann & Georg Nöldeke & Thomas Tröger, 2020. "The Balance Condition in Search‐and‐Matching Models," Econometrica, Econometric Society, vol. 88(2), pages 595-618, March.
    9. Gautier, Pieter A. & Svarer, Michael & Teulings, Coen, 2005. "Marriage and the City," IZA Discussion Papers 1491, Institute of Labor Economics (IZA).
    10. Lauermann, Stephan & Nöldeke, Georg, 2014. "Stable marriages and search frictions," Journal of Economic Theory, Elsevier, vol. 151(C), pages 163-195.
    11. Hakimov, Rustamdjan & Kübler, Dorothea, 2019. "Experiments On Matching Markets: A Survey," Rationality and Competition Discussion Paper Series 153, CRC TRR 190 Rationality and Competition.
    12. Chade, Hector, 2006. "Matching with noise and the acceptance curse," Journal of Economic Theory, Elsevier, vol. 129(1), pages 81-113, July.
    13. Gautier, Pieter A. & Svarer, Michael & Teulings, Coen N., 2010. "Marriage and the city: Search frictions and sorting of singles," Journal of Urban Economics, Elsevier, vol. 67(2), pages 206-218, March.
    14. Twisha Chatterjee, 2018. "A model of search and matching with PES intermediation," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 8(1), pages 1-36, April.
    15. Coles, Melvyn & Francesconi, Marco, 2007. "On the Emergence of Toyboys: Equilibrium Matching with Ageing and Uncertain Careers," IZA Discussion Papers 2612, Institute of Labor Economics (IZA).
    16. Du, Julan & Wang, Yongqin & Zhang, Yan, 2015. "Sex imbalance, marital matching and intra-household bargaining: Evidence from China," China Economic Review, Elsevier, vol. 35(C), pages 197-218.
    17. Hector Chade & Jan Eeckhout & Lones Smith, 2017. "Sorting through Search and Matching Models in Economics," Journal of Economic Literature, American Economic Association, vol. 55(2), pages 493-544, June.
    18. Garth Baughman, 2016. "Deadlines and Matching," Finance and Economics Discussion Series 2016-14, Board of Governors of the Federal Reserve System (U.S.).
    19. Antler, Yair & Bachi, Benjamin, 2019. "Searching Forever After," CEPR Discussion Papers 14103, C.E.P.R. Discussion Papers.
    20. Herrenbrueck, Lucas & Xia, Xiaoyu & Eastwick, Paul & Hui, Chin Ming, 2018. "Smart-dating in speed-dating: How a simple Search model can explain matching decisions," European Economic Review, Elsevier, vol. 106(C), pages 54-76.

    More about this item

    Keywords

    Decentralized matching; Segregation; Experiment;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:gamebe:v:90:y:2015:i:c:p:17-43. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622836 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.