A stable residence exchange problem

Abstract

<p>This paper introduces a new matching problem, the Stable Residence Exchange Problem, which originates from the needs for residence exchange in China. The problem involves n families wishing to exchange their residences voluntarily on the basis of their own preferences. Residence exchange can be arranged through exchange rings where each family in a ring moves to the residence of the next family in the ring. A residence exchange assignment is stable if under the assignment, there does not exist any unassigned ring in which at least one family is better off and none is worse off. For any instance of the problem, a stable solution is unique, always exists and can be found by using a forward chaining algorithm. A family cannot be better off by misrepresenting its true preferences and cannot be w orse off by submitting more choices as long as they are desirable. Finally, computer simulation is used to assess the effect of pool size and number of choices on the result of residence exchange.</p>