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The Success of the Deferred Acceptance Algorithm under Heterogenous Preferences with Endogenous Aspirations

Saglam, Ismail (2019): The Success of the Deferred Acceptance Algorithm under Heterogenous Preferences with Endogenous Aspirations.

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Abstract

In this paper, we consider a one-to-one matching model with two phases; an adolescence phase where individuals meet a number of dates and learn about their aspirations, followed by a matching phase where individuals are matched according to a version of Gale and Shapley's (1962) deferred acceptance (DA) algorithm. Using simulations of this model, we study how the likelihoods of matching and divorce, and also the balancedness and the speed of matching associated with the outcome of the DA algorithm are affected by the size of correlation in the preferences of individuals and by the frequency individuals update their aspirations in the adolescence phase.

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