Stable Partnerships, Matching, and Local Public Goods
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In the presence of local public goods differences in tastes are an important determinant of the way in which partnerships are formed. Heterogeneity in tastes for private vs. public goods produces a tendency to positive assortment and partnerships of couples with similar tastes; heterogeneity in tastes for different public goods brings about partnerships of couples with similar tastes only if there is a significant overlap in the distribution of tastes of the two groups to be matched. We show that with two public goods we may get negative assortment, pure positive assortment being only one of many possibilities.
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WP 2002-32 October 2002
JEL Classification Codes: C78; D13; D61; H41
JEL Classification Codes: C78; D13; D61; H41
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2002-10
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Charles H. Dyson School of Applied Economics and Management, Cornell University
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Matching; sorting; local public goods; heterogeneity of tastes
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