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The Mortensen rule and efficient coordination unemployment
Working paper   Open access

The Mortensen rule and efficient coordination unemployment

Benoît Julien, John Kennes and Ian King
12/2005
Handle:
https://hdl.handle.net/10523/1054

Abstract

HB Economic Theory
We apply the efficiency axioms of Mortensen (1982) to a set of matching games involving coordination frictions between buyers. These games include markets with .finite numbers of buyers and sellers and markets with infinite numbers of heterogenous buyers and homogenous sellers. We show that the Mortensen rule, but not the Hosios rule, gives constrained efficient allocations. We also show that the Mortensen rule is implemented by a simple auction.
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