Private parking slot sharing

•To our best knowledge, this paper is among the first addressing the private parking slot sharing problem.•Our results extend the existing market design theory so that money flow is allowed in the matching mechanisms.•Proposed mechanisms are effective in terms of the compatibility with money flow, agents' welfare, and strategy-proofness.•Experimental results further show that the proposed mechanisms would result in remarkable social welfare, and (ex post) budget balance for the platform in a big city with large population.•In some realistic settings, our proposed mechanisms can almost realize cost saving of 60% and make more than 50% of agents strictly better off.

This paper addresses the private parking slot sharing problem during regular working hours in a big city. Our results extend the existing market design theory so that money flow is allowed in the matching mechanisms. We consider two cases of money flow: (i) one agent who fails to exchange his parking slot can join the leasing mechanism as a lessor; and (ii) one agent who fails in parking slot exchange can always “transfer” (rent) his parking slots to the platform. Each agent is self-interested. We propose the (price-compatible) top trading cycles and deals (TTCD) mechanism for case (i) and the price-compatible top trading cycles and chains (PC-TTCC) mechanism for case (ii). Both mechanisms are effective in terms of the compatibility with money flow, agents' welfare, and strategy-proofness. Our experimental results further show that the proposed mechanisms would result in remarkable social welfare, and (ex post) budget balance for the platform in a big city with large population. In some realistic settings, our proposed mechanisms can almost realize cost saving of 60% and make more than 50% of agents strictly better off. There is no private parking slot sharing in the benchmark case. Overall, this paper opens the door to the solutions of a host of price-compatible matching problems.