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The Skipping-down strategy and stability in school choice problems with affirmative action: Theory and experiment

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  • Kawagoe, Toshiji
  • Matsubae, Taisuke
  • Takizawa, Hirokazu

Abstract

This paper presents a theoretical and experimental study of affirmative action policies in school choice problems focusing on the minority reserve mechanism, or DA-Reserve, proposed by Hafalir et al. (2013) and the majority quota mechanism, or DA-Quota, proposed by Abdulkadiroglu and Sönmez (2003), Kojima (2012) and Matsubae (2011). An evaluation of the performance of these mechanisms showed that, (1) while truth-telling is a dominant strategy in both mechanisms, the rate of its occurrence was less than 60%; (2) the average payoff was significantly higher with DA-Reserve than with DA-Quota, as theoretically predicted; (3) surprisingly, the proportion of students exhibiting justified envy was higher with DA-Reserve than with DA-Quota; and (4) a systematic pattern of deviation from the dominant strategy (referred to as skipping-down) was observed, and it was theoretically proven that this constituted Nash equilibrium with DA-Quota in some environments but not with DA-Reserve. More generally, the set of stable matchings was found to be larger with DA-Quota than with DA-Reserve, which explains the matching instability observed with the latter.

Suggested Citation

  • Kawagoe, Toshiji & Matsubae, Taisuke & Takizawa, Hirokazu, 2018. "The Skipping-down strategy and stability in school choice problems with affirmative action: Theory and experiment," Games and Economic Behavior, Elsevier, vol. 109(C), pages 212-239.
    • Handle: RePEc:eee:gamebe:v:109:y:2018:i:c:p:212-239
    DOI: 10.1016/j.geb.2017.12.012
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    4. Natsumi Shimada, 2022. "An experimental study on strategic preference formation in two-sided matching markets," ISER Discussion Paper 1169, Institute of Social and Economic Research, Osaka University.
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    More about this item

    Keywords

    School choice; Truth-telling; Affirmative action; Market design; Experiment;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • I20 - Health, Education, and Welfare - - Education - - - General

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