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Preference Intensities and Risk Aversion in School Choice: A Laboratory Experiment

Author

Listed:
  • Flip Klijn

    (Harvard Business School)

  • Joana Pais

    (Technical University of Lisbon
    UECE–Research Unit on Complexity and Economics)

  • Marc Vorsatz

    (Fundacion de Estudios de Economia Aplicada (FEDEA))

Abstract

We experimentally investigate in the laboratory two prominent mechanisms that are employed in school choice programs to assign students to public schools. We study how individual behavior is influenced by preference intensities and risk aversion. Our main results show that (a) the Gale-Shapley mechanism is more robust to changes in cardinal preferences than the Boston mechanism independently of whether individuals can submit a complete or only a restricted ranking of the schools and (b) subjects with a higher degree of risk aversion are more likely to play "safer" strategies under the Gale-Shapley but not under the Boston mechanism. Both results have important implications for the efficiency and the stability of the mechanisms.

Suggested Citation

  • Flip Klijn & Joana Pais & Marc Vorsatz, 2010. "Preference Intensities and Risk Aversion in School Choice: A Laboratory Experiment," Harvard Business School Working Papers 10-093, Harvard Business School.
    • Handle: RePEc:hbs:wpaper:10-093
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    school choice; risk aversion; preference intensities; laboratory experiment; Gale-Shapley mechanism; Boston mechanism; efficiency; stability; constrained choice;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • 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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