Incentives in decentralized random matching markets

Decentralized markets are modeled by means of a sequential game where, start-ing from any matching situation, \u85 rms are randomly given the opportunity to make job o¤ers. In this random context, we prove the existence of ordinal subgame per-fect equilibria where \u85rms act according to a list of preferences. Moreover, every such equilibrium preserves stability for a particular pro\u85le of preferences. In par-ticular, when \u85rms act truthfully, every outcome is stable for the true preferences. Conversely, when the initial matching is the empty matching, every stable match-ing can be reached as the outcome of an ordinal equilibrium play of the game. JEL Classi\u85cation: C78; J4