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We develop a directed search model of relationship formation which can disentangle male and female preferences for types of partners and for different relationship terms using only a cross-section of observed matches. Individuals direct their search to a particular type of match on the basis of (i) the terms of the relationship, (ii) the type of partner, and (iii) the endogenously determined probability of matching. If men outnumber women, they tend to trade a low probability of a preferred match for a high probability of a less-preferred match; the analogous statement holds for women. Using data from National Longitudinal Study of Adolescent Health we estimate the equilibrium matching model with high school relationships. Variation in gender ratios is used to uncover male and female preferences. Estimates from the structural model match subjective data on whether sex would occur in one's ideal relationship. The equilibrium result shows that some women would ideally not have sex, but do so out of matching concerns; the reverse is true for men.

Matching theory.

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A Nobel laureate reveals the often surprising rules that govern a vast array of activities -- both mundane and life-changing -- in which money may play little or no role. If you've ever sought a job or hired someone, applied to college or guided your child into a good kindergarten, asked someone out on a date or been asked out, you've participated in a kind of market. Most of the study of economics deals with commodity markets, where the price of a good connects sellers and buyers. But what about other kinds of "goods," like a spot in the Yale freshman class or a position at Google? This is the territory of matching markets, where "sellers" and "buyers" must choose each other, and price isn't the only factor determining who gets what. Alvin E. Roth is one of the world's leading experts on matching markets. He has even designed several of them, including the exchange that places medical students in residencies and the system that increases the number of kidney transplants by better matching donors to patients. In Who Gets What -- And Why, Roth reveals the matching markets hidden around us and shows how to recognize a good match and make smarter, more confident decisions.

Microeconomics --- Economics --- Matching Theory --- Game theory --- Markets

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This paper addresses the following question: what ties together the traditional commercial banking activities of deposit-taking and lending? We begin by observing that since banks often lend via commitments, or credit lines, their lending and deposit-taking may be two manifestations of the same primitive function: the provision of liquidity on demand. After all, once the decision to extend a line of credit has been made, it is really nothing more than a checking account with overdraft privileges. This observation leads us to argue that there will naturally be synergies between the two activities, to the extent that both require banks to hold large volumes of liquid assets (cash and securities) on their balance sheets: if deposit withdrawals and commitment takedowns are imperfectly correlated, the two activities can share any deadweight costs of holding the liquid assets. We develop this idea with a simple model, and then use a variety of data to test the model's empirical implications.

Matching theory. --- Liquidity (Economics) --- Banks and banking.

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The term "stringology" is a popular nickname for text algorithms, or algorithms on strings. This book deals with the most basic algorithms in the area. Most of them can be viewed as "algorithmic jewels" and deserve reader-friendly presentation. One of the main aims of the book is to present several of the most celebrated algorithms in a simple way by omitting obscuring details and separating algorithmic structure from combinatorial theoretical background. The book reflects the relationships between applications of text-algorithmic techniques and the classification of algorithms according to the measures of complexity considered. The text can be viewed as a parade of algorithms in which the main purpose is to discuss the foundations of the algorithms and their interconnections. One can partition the algorithmic problems discussed into practical and theoretical problems. Certainly, string matching and data compression are in the former class, while most problems related to symmetries and repetitions in texts are in the latter. However, all the problems are interesting from an algorithmic point of view and enable the reader to appreciate the importance of combinatorics on words as a tool in the design of efficient text algorithms. In most textbooks on algorithms and data structures, the presentation of efficient algorithms on words is quite short as compared to issues in graph theory, sorting, searching, and some other areas. At the same time, there are many presentations of interesting algorithms on words accessible only in journals and in a form directed mainly at specialists. This book fills the gap in the book literature on algorithms on words, and brings together the many results presently dispersed in the masses of journal articles. The presentation is reader-friendly; many examples and about two hundred figures illustrate nicely the behaviour of otherwise very complex algorithms.

Computer algorithms. --- Matching theory. --- Combinatorial analysis --- Marriage theorem --- Algorithms

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We report on the design of the new clearinghouse adopted by the National Resident Matching Program, which annually fills approximately 20,000 jobs for new physicians in the United States. Because that market exhibits many complementarities between applicants and between positions, the theory of simple matching markets does not apply directly. However, computational experiments reveal that the theory provides a good approximation, and furthermore the set of stable matchings, and the opportunities for strategic manipulation, are surprisingly small. A new kind of core convergence' result is presented to explain this; the fact that each applicant can interview for only a small fraction of available positions is important. We also describe in detail engineering aspects of the design process.

Physicians --- Matching theory. --- Economic history. --- Supply and demand.