An essay on assignment games

Abstract

This degree project studies the main results on the bilateral assignment game. This is a part of cooperative game theory and models a market with indivisibilities and money. There are two sides of the market, let us say buyers and sellers, or workers and firms, such that when we match two agents from different sides, a profit is made. We show some good properties of the core of these games, such as its non-emptiness and its lattice structure. There are two outstanding points: the buyers-optimal core allocation and the sellers-optimal core allocation, in which all agents of one sector get their best possible outcome. We also study a related non-cooperative mechanism, an auction, to implement the buyers-optimal core allocation.