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Nash implementation on the basis of general priorities

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  • Iwase, Yusuke
  • Tsuruta, Shoya
  • Yoshimura, Akina

Abstract

We consider a school choice problem under general priorities with ties. Priorities in practice are usually complex since a school may rank students equally or care about an affirmative action policy. Thus, we do not specify a class of priorities already known, but abstractly treat all priorities such that a stable matching exists for all students' preference profiles. For those priorities, it is unknown whether stable matchings are achievable when students are strategic. We show that a stable correspondence is implementable in Nash equilibria. Then, we focus on the Pareto-frontier of stable matchings, which we call constrained efficient stable. We show that, under a reasonable class of priorities, a constrained efficient stable correspondence is Nash implementable if and only if it satisfies Maskin monotonicity. Finally, we identify a necessary and sufficient condition on priorities under which a constrained efficient stable correspondence is Nash implementable.

Suggested Citation

  • Iwase, Yusuke & Tsuruta, Shoya & Yoshimura, Akina, 2022. "Nash implementation on the basis of general priorities," Games and Economic Behavior, Elsevier, vol. 132(C), pages 368-379.
  • Handle: RePEc:eee:gamebe:v:132:y:2022:i:c:p:368-379
    DOI: 10.1016/j.geb.2022.01.012
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    More about this item

    Keywords

    Nash implementation; Stability; Constrained efficient stability; Acyclicity;
    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
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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