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Welfare properties of the Taiwan mechanism

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  • Wolff, Ilan

Abstract

This paper analyzes the welfare properties of the mechanism Taiwan uses to match students to high schools. I study the Taiwan mechanism under a theoretical model where students share the same ordinal rankings, and a single lottery determines schools’ preferences. In this setting, all Taiwan mechanisms ex ante weakly Pareto dominate deferred acceptance for strategizing students. Additionally, in my model, there always exists a Taiwan mechanism that provides greater welfare than deferred acceptance to students who do not strategize. Using Cambridge Public School data, I demonstrate that the Taiwan mechanism outperforms deferred acceptance for a range of deduction rules.

Suggested Citation

  • Wolff, Ilan, 2026. "Welfare properties of the Taiwan mechanism," Games and Economic Behavior, Elsevier, vol. 158(C), pages 80-113.
    • Handle: RePEc:eee:gamebe:v:158:y:2026:i:c:p:80-113
    DOI: 10.1016/j.geb.2025.11.005
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