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This research applies LLM agents and contextual bandits to decentralized bipartite matching, demonstrating improved mutual welfare in simulated market scenarios without relying on centralized preference data. By modeling reciprocal acceptance through online learning, the study offers a novel framework for computational social science that addresses limitations of classical game-theoretic approaches under incomplete information.
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From Preference to Reciprocity: Decentralized Matching with Empirically Grounded LLM-agent Based Modeling

arXiv3 min read

arXiv:2609.34679v1 Announce Type: new Abstract: Bipartite matching is a fundamental problem in game theory and market design. Classical approaches such as Gale--Shapley assume complete preferences and centralized computation, whereas many real-world matching processes are decentralized, asynchronous, and shaped by sequential interaction under limited information. We propose a dynamic bipartite matching framework that combines large language model (LLM) agents with contextual bandits. In a simulated Chinese marriage market, economically grounded LLM agents evaluate locally encountered candidates, while agent-specific Logistic-UCB models learn reciprocal acceptance from realized proposal outcomes. The mechanism therefore separates two decisions---\emph{whom do I like?} and \emph{who is likely to like me back?}---without requiring ex ante market-wide preference rankings. We first validate LLM-induced mate preferences against the empirical conditional-logit reference across multiple LLM backbones. In the $50\times50$ matching experiment, Bandit-UCB achieves the highest mean mutual welfare (56.01 versus 54.87 for Gale--Shapley), a smaller gender rank gap than the classical baselines, and the fewest blocking pairs among the LLM-ABM policies. Learned acceptance models show economically interpretable gender-differentiated associations, while counterfactual setups reveal no systematic unilateral advantage from prior search knowledge. Overall, these results support the advantages of decentralized matching with LLM-based behavioral modeling and online learning under incomplete information for economic simulation and computational social science research.

Abstract:Bipartite matching is a fundamental problem in game theory and market design. Classical approaches such as Gale--Shapley assume complete preferences and centralized computation, whereas many real-world matching processes are decentralized, asynchronous, and shaped by sequential interaction under limited information. We propose a dynamic bipartite matching framework that combines large language model (LLM) agents with contextual bandits. In a simulated Chinese marriage market, economically grounded LLM agents evaluate locally encountered candidates, while agent-specific Logistic-UCB models learn reciprocal acceptance from realized proposal outcomes. The mechanism therefore separates two decisions---\emph{whom do I like?} and \emph{who is likely to like me back?}---without requiring ex ante market-wide preference rankings. We first validate LLM-induced mate preferences against the empirical conditional-logit reference across multiple LLM backbones. In the $50\times50$ matching experiment, Bandit-UCB achieves the highest mean mutual welfare (56.01 versus 54.87 for Gale--Shapley), a smaller gender rank gap than the classical baselines, and the fewest blocking pairs among the LLM-ABM policies. Learned acceptance models show economically interpretable gender-differentiated associations, while counterfactual setups reveal no systematic unilateral advantage from prior search knowledge. Overall, these results support the advantages of decentralized matching with LLM-based behavioral modeling and online learning under incomplete information for economic simulation and computational social science research.

Machine Learning (cs.LG); Artificial Intelligence (cs.AI)

arXiv:2609.34679 [cs.LG]

(or arXiv:2609.34679v1 [cs.LG] for this version)

https://doi.org/10.48550/arXiv.2609.34679 Focus to learn more arXiv-issued DOI via DataCite (pending registration)

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Full text under the publisher's open licence · 298 words

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