Stability of marriage with externalities (Q956582)

Endogenously introduced beliefs are introduced into a matching game. Sufficient conditions for the estimation functions to be compatible with the existence stable matching are derived. A particular notion of beliefs (called sophisticated expectations) is introduced. It is shown that with them, stable matching always exist. An algorithm to determine them is given. A generalization of the concept of core is given. It is called the bargaining set. A sufficient condition on the preferences to ensure that it is nonempty is provided.