Course Bidding at Business Schools
Abstract
Mechanisms that rely on course bidding are widely used at Business Schools in order to allocate seats at oversubscribed courses. Bids play two key roles under these mechanisms: Bids are used to infer student preferences and bids are used to determine who have bigger claims on course seats. We show that these two roles may easily conflict and preferences induced from bids may significantly differ from the true preferences. Therefore while these mechanisms are promoted as market mechanisms, they do not necessarily yield market outcomes. The two conflicting roles of bids is a potential source of efficiency loss part of which can be avoided simply by asking students to state their preferences in addition to bidding and thus "separating" the two roles of the bids. While there may be multiple market outcomes under this proposal, there is a market outcome which Pareto dominates any other market outcome.(This abstract was borrowed from another version of this item.)
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Paper provided by University of Pittsburgh, Department of Economics in its series Working Papers with number 257.Length:
Date of creation: Jan 2003
Date of revision: Jan 2003
Handle: RePEc:pit:wpaper:257
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Related research
Keywords:Other versions of this item:
- Tayfun Sönmez & M. Utku Ünver, 2010. "Course Bidding At Business Schools," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 51(1), pages 99-123, 02.
- Tayfun Sönmez & M. Utku Ünver, 2005. "Course Bidding at Business Schools," Boston College Working Papers in Economics 618, Boston College Department of Economics.
- Tayfun Sonmez & M. Utku Unver, 2003. "Course Bidding at Business Schools," Game Theory and Information 0306001, EconWPA, revised 02 Jan 2004.
- C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Atila Abdulkadiroğlu & Yeon-Koo Che & Yosuke Yasuda, 2010.
"Expanding “Choice” in School Choice,"
Levine's Working Paper Archive
661465000000000062, David K. Levine.
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- Mariagiovanna Baccara & Ayse Imrohoroglu & Alistair Wilson & Leeat Yariv, 2009.
"A Field Study on Matching with Network Externalities,"
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09-13, New York University, Leonard N. Stern School of Business, Department of Economics.
- Mariagiovanna Baccara & Ayse Imrohoroglu & Alistair J. Wilson & Leeat Yariv, 2012. "A Field Study on Matching with Network Externalities," American Economic Review, American Economic Association, vol. 102(5), pages 1773-1804, August.
- Alistair Wilson & Mariagiovanna Baccara & Ayse Imrohoroglu & Leeat Yariv, 2009. "A Field Study on Matching with Network Externalities," Working Papers 486, University of Pittsburgh, Department of Economics, revised Sep 2011.
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