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The Mechanism is Truthful, Why aren?t You?

Author

Listed:
  • Avinatan Hassidim
  • Deborah Marciano
  • Assaf Romm
  • Ran I. Shorrer

Abstract

Honesty is the best policy in the face of a strategy-proof mechanism--irrespective of others' behavior, the best course of action is to report one's preferences truthfully. We review evidence from different markets in different countries and find that a substantial percentage of participants do not report their true preferences to the strategy-proof Deferred Acceptance mechanism. Two recurring correlates of preference misrepresentation are lower cognitive ability and the expectation of stronger competition. We evaluate possible explanations, which we hope will inform practicing market designers.
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Suggested Citation

  • Avinatan Hassidim & Deborah Marciano & Assaf Romm & Ran I. Shorrer, "undated". "The Mechanism is Truthful, Why aren?t You?," Working Paper 501161, Harvard University OpenScholar.
    • Handle: RePEc:qsh:wpaper:501161
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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