Information Acquisition Costs in Matching Markets

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Many-to-one matching with costly, endogenous information uses a Weitzman-style search model where each student pays inspection costs to learn college-specific values; the paper proves existence and a lattice of regretfully stable outcomes (matching plus optimal inspection), reduces structure to a small vector of market-clearing cut-offs, and shows standard succinct mechanisms (e.g. deferred acceptance) can produce informational deadlocks via a three-student cyclic gadget. Main prescriptions: post estimated cut-offs (from history or bootstrap) so decentralized optimal search recovers approximately efficient, regret-free stable outcomes.

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" chapters (22)

1. 0:00Intro
2. 0:48The Standard College Admission Model
3. 3:07Costly Information Acquisition
4. 3:41Overview
5. 6:09Related Literature
6. 11:54Assumptions
7. 15:31Student Information Acquisition
8. 24:15Information Acquisition and Regret
9. 27:05Stability...
10. 28:09Stability under Partial Information
11. 30:11Regret-Free Stability
12. 36:16Existence and Uniqueness
13. 37:55Cutoff Structure-Proof Idea
14. 38:33Roadmap
15. 40:12Guiding Information Acquisition
16. 41:10Succinct Communication Process
17. 42:06Information Deadlock
18. 43:31An Impossibility Result
19. 44:48Communication Processes
20. 45:54Using Historical Data
21. 47:27Bootstrapping from "Free Information"
22. 47:41Conclusions