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Optimal Assignment of Durable Objects to Successive Agents

Author

Listed:
  • Francis Bloch

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique - IP Paris - Institut Polytechnique de Paris)

  • Nicolas Houy

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique - IP Paris - Institut Polytechnique de Paris)

Abstract

This paper analyzes the assignment of durable objects to successive generations of agents who live for two periods. The optimal assignment rule is stationary, favors old agents and is determined by a selectivity function which satisfies an iterative functional differential equation. More patient social planners are more selective, as are social planners facing distributions of types with higher probabilities for higher types. The paper also characterizes optimal assignment rules when monetary transfers are allowed and agents face a recovery cost, when agents' types are private information and when agents can invest to improve their types.

Suggested Citation

  • Francis Bloch & Nicolas Houy, 2009. "Optimal Assignment of Durable Objects to Successive Agents," Working Papers hal-00435385, HAL.
    • Handle: RePEc:hal:wpaper:hal-00435385
    Note: View the original document on HAL open archive server: https://hal.science/hal-00435385
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    References listed on IDEAS

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    1. Cyrus Derman & Gerald J. Lieberman & Sheldon M. Ross, 1972. "A Sequential Stochastic Assignment Problem," Management Science, INFORMS, vol. 18(7), pages 349-355, March.
    2. Francis Bloch & David Cantala, 2013. "Markovian assignment rules," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 40(1), pages 1-25, January.
    3. Gershkov, Alex & Moldovanu, Benny, 2010. "Efficient sequential assignment with incomplete information," Games and Economic Behavior, Elsevier, vol. 68(1), pages 144-154, January.
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    5. Alessandro Citanna, 2007. "The dynamics of wealth distribution with asymmetric incentives and endogenous matching," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 33(2), pages 243-261, November.
    6. Francis Bloch & Nicolas Houy, 2012. "Optimal assignment of durable objects to successive agents," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 51(1), pages 13-33, September.
    7. Abdulkadiroglu, Atila & Sonmez, Tayfun, 1999. "House Allocation with Existing Tenants," Journal of Economic Theory, Elsevier, vol. 88(2), pages 233-260, October.
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    9. Kahn, Charles & Huberman, Gur, 1988. "Two-sided Uncertainty and "Up-or-Out" Contracts," Journal of Labor Economics, University of Chicago Press, vol. 6(4), pages 423-444, October.
    10. Susan Athey & Ilya Segal, 2013. "An Efficient Dynamic Mechanism," Econometrica, Econometric Society, vol. 81(6), pages 2463-2485, November.
    11. Carmichael, H Lorne, 1988. "Incentives in Academics: Why Is There Tenure?," Journal of Political Economy, University of Chicago Press, vol. 96(3), pages 453-472, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Dimakopoulos, Philipp D. & Heller, C.-Philipp, 2019. "Matching with waiting times: The German entry-level labor market for lawyers," Games and Economic Behavior, Elsevier, vol. 115(C), pages 289-313.
    2. Atal, Vidya & Bar, Talia & Gordon, Sidartha, 2016. "Project selection: Commitment and competition," Games and Economic Behavior, Elsevier, vol. 96(C), pages 30-48.
    3. Takashi Kamihigashi, 2014. "An order-theoretic approach to dynamic programming: an exposition," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 2(1), pages 13-21, April.
    4. Francis Bloch & David Cantala, 2017. "Dynamic Assignment of Objects to Queuing Agents," American Economic Journal: Microeconomics, American Economic Association, vol. 9(1), pages 88-122, February.
    5. Mertikopoulos, Panayotis & Nax, Heinrich H. & Pradelski, Bary S.R., 2024. "Quick or cheap? Breaking points in dynamic markets," Journal of Mathematical Economics, Elsevier, vol. 112(C).
    6. Jhan-Jia Lin & Yu-Tse Lee & Ja-Ling Wu, 2021. "The Effect of Thickness-Based Dynamic Matching Mechanism on a Hyperledger Fabric-Based TimeBank System," Future Internet, MDPI, vol. 13(3), pages 1-21, March.
    7. Panayotis Mertikopoulos & Heinrich H. Nax & Bary S. R. Pradelski, 2019. "Quick or cheap? Breaking points in dynamic markets," ECON - Working Papers 338, Department of Economics - University of Zurich.
    8. Francis Bloch & David Cantala, 2014. "Dynamic Allocation of Objects to Queuing Agents: The Discrete Model," Post-Print halshs-01109667, HAL.
    9. Hinnosaar, Toomas, 2017. "Calendar mechanisms," Games and Economic Behavior, Elsevier, vol. 104(C), pages 252-270.
    10. Panayotis Mertikopoulos & Heinrich H. Nax & Bary S. R. Pradelski, 2019. "Quick or Cheap? Breaking Points in Dynamic Markets," Cowles Foundation Discussion Papers 2217, Cowles Foundation for Research in Economics, Yale University.
    11. Panda, Saunak Kumar & Xiang, Yisha & Liu, Ruiqi, 2024. "Dynamic resource matching in manufacturing using deep reinforcement learning," European Journal of Operational Research, Elsevier, vol. 318(2), pages 408-423.
    12. repec:hal:spmain:info:hdl:2441/7o52iohb7k6srk09n8t8j8cil is not listed on IDEAS
    13. repec:spo:wpecon:info:hdl:2441/7o52iohb7k6srk09n8t8j8cil is not listed on IDEAS
    14. Irene Lo & Vahideh Manshadi & Scott Rodilitz & Ali Shameli, 2020. "Commitment on Volunteer Crowdsourcing Platforms: Implications for Growth and Engagement," Papers 2005.10731, arXiv.org, revised Jul 2021.
    15. Takashi Kamihigashi, 2014. "Elementary results on solutions to the bellman equation of dynamic programming: existence, uniqueness, and convergence," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 56(2), pages 251-273, June.
    16. Dimakopoulos, Philipp D. & Heller, C.-Philipp, 2015. "Matching with Waiting Times: The German Entry-Level Labour Market for Lawyers," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113153, Verein für Socialpolitik / German Economic Association.
    17. Philipp D. Dimakopoulos & Christian-Philipp Heller, "undated". "Matching with Waiting Times: The German Entry-Level Labour Market for Lawyers," BDPEMS Working Papers 2014005, Berlin School of Economics.
    18. Francis Bloch & Nicolas Houy, 2012. "Optimal assignment of durable objects to successive agents," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 51(1), pages 13-33, September.
    19. repec:hal:wpspec:info:hdl:2441/7o52iohb7k6srk09n8t8j8cil is not listed on IDEAS
    20. repec:spo:wpmain:info:hdl:2441/7o52iohb7k6srk09n8t8j8cil is not listed on IDEAS
    21. Dimakopoulos, Philipp D. & Heller, C.-Philipp, 2018. "Matching with Waiting Times: The German Entry-Level Labor Market for Lawyers," Rationality and Competition Discussion Paper Series 68, CRC TRR 190 Rationality and Competition.
    22. Julien Combe & Vladyslav Nora & Olivier Tercieux, 2021. "Dynamic assignment without money: Optimality of spot mechanisms," Working Papers 2021-11, Center for Research in Economics and Statistics.

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    More about this item

    Keywords

    Dynamic Assignment; Durable Objects; Revenue Management; Dynamic Mechanism Design; Overlapping Generations; Promotions and Intertemporal Assignments;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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