Stability, Strategy-Proofness, and Cumulative Offer Mechanisms

We consider the setting of many-to-one matching with contracts, where firms may demand multiple contracts but each worker desires at most one contract. We introduce three novel conditions—observable substitutability, observable size monotonicity, and non-manipulatability—and show that when these conditions are satisfied, the cumulative offer mechanism is the unique mechanism that is stable and strategy-proof (for workers). Moreover, when the choice function of some firm fails any of our three conditions, one can construct unit-demand choice functions for the other firms such that no stable and strategy-proof mechanism exists. In the final part of the paper, we characterize the class of choice functions for which the cumulative offer mechanism is guaranteed to yield a stable outcome.