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Allocating via Priorities

Author

Listed:
  • Alcalde, Jose

    (Universidad de Alicante, Departamento de Métodos Cuantitativos y Teoría Económica)

  • Silva-Reus, José Ángel

    (Universidad de Alicante, Departamento de Métodos Cuantitativos y Teoría Económica)

Abstract

We design a mechanism to allocate indivisible objects that combines procedural and distributive fairness. It associates each allocation problem a family of priorities to be used when determining how agents and objects should be matched. The selection of specific priorities, correlated with agents' preferences, guarantees the (ex-ante) equity of the outcome. The analysis of our mechanism, both from the efficiency and the strategic perspectives, enables us to connect the recent literature on random assignment (Bogomolnaia and Moulin, 2001) and the traditional analysis of matching mechanisms (Gale and Shapley, 1962).

Suggested Citation

  • Alcalde, Jose & Silva-Reus, José Ángel, 2013. "Allocating via Priorities," QM&ET Working Papers 13-3, University of Alicante, D. Quantitative Methods and Economic Theory.
    • Handle: RePEc:ris:qmetal:2013_003
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    References listed on IDEAS

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    1. YIlmaz, Özgür, 2010. "The probabilistic serial mechanism with private endowments," Games and Economic Behavior, Elsevier, vol. 69(2), pages 475-491, July.
    2. José Alcalde & Antonio Romero-Medina, 2017. "Fair student placement," Theory and Decision, Springer, vol. 83(2), pages 293-307, August.
    3. Abdulkadiroglu, Atila & Sonmez, Tayfun, 2003. "Ordinal efficiency and dominated sets of assignments," Journal of Economic Theory, Elsevier, vol. 112(1), pages 157-172, September.
    4. Katta, Akshay-Kumar & Sethuraman, Jay, 2006. "A solution to the random assignment problem on the full preference domain," Journal of Economic Theory, Elsevier, vol. 131(1), pages 231-250, November.
    5. Hylland, Aanund & Zeckhauser, Richard, 1979. "The Efficient Allocation of Individuals to Positions," Journal of Political Economy, University of Chicago Press, vol. 87(2), pages 293-314, April.
    6. Bogomolnaia, Anna, 2015. "Random assignment: Redefining the serial rule," Journal of Economic Theory, Elsevier, vol. 158(PA), pages 308-318.
    7. Atila Abdulkadiroglu & Tayfun Sonmez, 1998. "Random Serial Dictatorship and the Core from Random Endowments in House Allocation Problems," Econometrica, Econometric Society, vol. 66(3), pages 689-702, May.
    8. Bogomolnaia, Anna & Moulin, Herve, 2001. "A New Solution to the Random Assignment Problem," Journal of Economic Theory, Elsevier, vol. 100(2), pages 295-328, October.
    9. YIlmaz, Özgür, 2009. "Random assignment under weak preferences," Games and Economic Behavior, Elsevier, vol. 66(1), pages 546-558, May.
    10. Hashimoto, Tadashi & Hirata, Daisuke & Kesten, Onur & Kurino, Morimitsu & Unver, Utku, 2014. "Two axiomatic approaches to the probabilistic serial mechanism," Theoretical Economics, Econometric Society, vol. 9(1), January.
    11. Hervé Moulin & Anna Bogomolnaia, 2002. "A simple random assignment problem with a unique solution," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 19(3), pages 623-636.
    12. Atila Abdulkadiroglu & Tayfun Sönmez, 2003. "School Choice: A Mechanism Design Approach," American Economic Review, American Economic Association, vol. 93(3), pages 729-747, June.
    13. José Alcalde Pérez & Antonio Romero-Medina, 2011. "Fair School Placement," Working Papers. Serie AD 2011-22, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    14. Haluk I. Ergin, 2002. "Efficient Resource Allocation on the Basis of Priorities," Econometrica, Econometric Society, vol. 70(6), pages 2489-2497, November.
    15. Balinski, Michel & Sonmez, Tayfun, 1999. "A Tale of Two Mechanisms: Student Placement," Journal of Economic Theory, Elsevier, vol. 84(1), pages 73-94, January.
    16. Onur Kesten, 2010. "School Choice with Consent," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(3), pages 1297-1348.
    17. Alvin E. Roth, 1982. "The Economics of Matching: Stability and Incentives," Mathematics of Operations Research, INFORMS, vol. 7(4), pages 617-628, November.
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    Cited by:

    1. Alcalde, Jose, 2013. "Random Housing with Existing Tenants," QM&ET Working Papers 13-5, University of Alicante, D. Quantitative Methods and Economic Theory.
    2. Wonki Jo Cho, 2018. "Probabilistic assignment: an extension approach," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 51(1), pages 137-162, June.
    3. Cho, Wonki Jo, 2016. "Incentive properties for ordinal mechanisms," Games and Economic Behavior, Elsevier, vol. 95(C), pages 168-177.
    4. Cho, Wonki Jo, 2016. "When is the probabilistic serial assignment uniquely efficient and envy-free?," Journal of Mathematical Economics, Elsevier, vol. 66(C), pages 14-25.
    5. Cho, Wonki Jo & Doğan, Battal, 2016. "Equivalence of efficiency notions for ordinal assignment problems," Economics Letters, Elsevier, vol. 146(C), pages 8-12.

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    More about this item

    Keywords

    Correlated Priorities; Random Assignment; Serial Rule; Matching Markets;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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