Dynamic Recontracting Processes With Multiple Indivisible Goods

The authors consider multiple-type housing markets. To capture the dynamic aspect of trade in such markets, they study a dynamic re-contracting process similar to the one introduced by Serrano and Volij (2005). They analyze the set of recurrent classes of this process as a (non-empty) solution concept. They show that each core allocation always constitutes a singleton recurrent class and provide examples of non-singleton recurrent classes consisting of blocking-cycles of individually rational allocations. For multiple-type housing markets stochastic stability never serves as a selection device among recurrent classes.