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School choice with asymmetric information: priority design and the curse of acceptance

Author

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  • Kloosterman, Andrew

    (Department of Economics, University of Virginia)

  • Troyan, Peter

    (Department of Economics, University of Virginia)

Abstract

We generalize standard school choice models to allow for interdependent preferences and differentially-informed students. We show that in general, the commonly-used deferred acceptance mechanism is no longer strategy-proof, the outcome is not stable, and may make less informed students worse off. We attribute these results to curse of acceptance. However, we also show that if priorities are designed appropriately, positive results are recovered: equilibrium strategies are simple, the outcome is stable, and less informed students are protected from the curse of acceptance. Our results have implications for the current debate over priority design in school choice.

Suggested Citation

  • Kloosterman, Andrew & Troyan, Peter, 2020. "School choice with asymmetric information: priority design and the curse of acceptance," Theoretical Economics, Econometric Society, vol. 15(3), July.
    • Handle: RePEc:the:publsh:3621
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    References listed on IDEAS

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    Cited by:

    1. Andrew Kloosterman & Peter Troyan, 2023. "Rankings-Dependent Preferences: A Real Goods Matching Experiment," Papers 2305.03644, arXiv.org, revised Aug 2024.
    2. Atila Abdulkadiroglu & Tommy Andersson, 2022. "School Choice," NBER Working Papers 29822, National Bureau of Economic Research, Inc.
    3. Maxey, Tyler, 2024. "School choice with costly information acquisition," Games and Economic Behavior, Elsevier, vol. 143(C), pages 248-268.

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    More about this item

    Keywords

    Matching; stability; asymmetric information;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design

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