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Quota Adjustment Process

Author

Listed:
  • Taro Kumano

    (Yokohama National University, Department of Economics)

  • Morimitsu Kurino

    (Keio University, Faculty of Economics)

Abstract

In designing priority-based matching problems, such as school choice, the quota of each school is, to some extent, a design variable for a market designer. We define an ex-post student-optimal stable matching (ESOSM) as a matching that is stable at some implementable quota distribution, and is not Pareto dominated by any stable matching among all implementable quota distributions. A simple question is whether the total resources subject to several constraints are optimally distributed in the above sense. As optimal quota distributions vary depending on students�f preferences realized, no predetermined quota distribution is optimal for all of the students�f preferences. This requires a new matching mechanism design for the variable quota distributions. We propose the novel mechanism called quota adjustment process (QAP), which endogenously finds an ESOSM and the corresponding optimal quota distribution for any preferences and any initial quota distribution. To put this into practice, we proposed the QAP in the process of admission reform at the University of Tsukuba in Japan. Our proposal was officially approved and implemented at the University of Tsukuba in 2021.

Suggested Citation

  • Taro Kumano & Morimitsu Kurino, 2022. "Quota Adjustment Process," Keio-IES Discussion Paper Series 2022-016, Institute for Economics Studies, Keio University.
    • Handle: RePEc:keo:dpaper:2022-016
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    File URL: https://ies.keio.ac.jp/upload/DP2022-016_EN.pdf
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    References listed on IDEAS

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    1. Hafalir, Isa E. & Hakimov, Rustamdjan & Kübler, Dorothea & Kurino, Morimitsu, 2018. "College admissions with entrance exams: Centralized versus decentralized," Journal of Economic Theory, Elsevier, vol. 176(C), pages 886-934.
    2. Federico Echenique & M. Bumin Yenmez, 2015. "How to Control Controlled School Choice," American Economic Review, American Economic Association, vol. 105(8), pages 2679-2694, August.
    3. Aygün, Orhan & Turhan, Bertan, 2020. "Dynamic reserves in matching markets," Journal of Economic Theory, Elsevier, vol. 188(C).
    4. Fragiadakis, Daniel & Troyan, Peter, 2017. "Improving matching under hard distributional constraints," Theoretical Economics, Econometric Society, vol. 12(2), May.
    5. Shapley, Lloyd & Scarf, Herbert, 1974. "On cores and indivisibility," Journal of Mathematical Economics, Elsevier, vol. 1(1), pages 23-37, March.
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    Cited by:

    1. Afacan, Mustafa Oğuz & Dur, Umut & Van der Linden, Martin, 2024. "Capacity design in school choice," Games and Economic Behavior, Elsevier, vol. 146(C), pages 277-291.

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    More about this item

    Keywords

    quota adjustment process; stability; deferred acceptance mechanism; effciency; quota-adjustment stable improvement cycles;
    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
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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