How to Use Prices for Efficient Online Matching
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arXiv
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| Format: | Preprint |
| Veröffentlicht: |
2026
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| _version_ | 1866911591645052928 |
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| author | Highsmith, Terence |
| author_facet | Highsmith, Terence |
| contents | Many matching markets feature unknown, dynamic arrivals of agents that must match immediately. A caseworker must match an abused child to a foster home, a hospital must assign a patient in critical condition to a room, or a city must place a homeless individual into a shelter. We design an online matching algorithm -- the Sequential Equilibrium Mechanism (SEM) -- that approximates large market equilibria to match arriving agents to objects. SEM is asymptotically efficient, fair, and strategy-proof with probability one. Our application plans to deploy a lab-in-the-field experiment where real caseworkers match vulnerable children to host homes, and we provide simulation evidence that SEM can substantially improve welfare. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2604_12181 |
| institution | arXiv |
| publishDate | 2026 |
| record_format | arxiv |
| spellingShingle | How to Use Prices for Efficient Online Matching Highsmith, Terence Theoretical Economics Many matching markets feature unknown, dynamic arrivals of agents that must match immediately. A caseworker must match an abused child to a foster home, a hospital must assign a patient in critical condition to a room, or a city must place a homeless individual into a shelter. We design an online matching algorithm -- the Sequential Equilibrium Mechanism (SEM) -- that approximates large market equilibria to match arriving agents to objects. SEM is asymptotically efficient, fair, and strategy-proof with probability one. Our application plans to deploy a lab-in-the-field experiment where real caseworkers match vulnerable children to host homes, and we provide simulation evidence that SEM can substantially improve welfare. |
| title | How to Use Prices for Efficient Online Matching |
| topic | Theoretical Economics |
| url | https://arxiv.org/abs/2604.12181 |