Matching markets with middlemen under transferable utility

Abstract This paper studies matching markets in the presence of middlemen. In our framework, a buyer–seller pair may either trade directly or use services middleman; and middleman serve multiple pairs. For each such market, we examine associated TU game. We first show that, context, an optimal can be obtained by considering two-sided assignment market where is allowed to mediation any free charge. Second, prove that with middlemen are totally balanced: particular, existence buyer-optimal (seller-optimal) core allocation buyer (seller) receives her marginal contribution grand coalition. general, does not exhibit middleman-optimal allocation, even when there only two buyers sellers. However, these small maximum payoff contribution. Finally, establish coincidence between set competitive equilibrium vectors.