SMU SOE Seminar (Apr 11, 2019): On Stable and Efficient Mechanisms for Priority-based Allocation Problems

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ABSTRACT For school choice (priority-based allocation) problems, when the priority structure is acyclic, the associated (student-proposing) deferred acceptance algorithm is Pareto efficient and group strategy-proof (Ergin, 2002). We reveal a hidden iterative removal structure behind such deferred acceptance algorithms. A nonempty set of students is called a top fair set (TFS) if when all students apply to their most preferred schools and all schools accept the best applicants up to their quotas, students in the set are always accepted, regardless of other students’ preferences. We provide an elimination process to find the maximal TFS, if any TFS exists. We show that for any priority structure, iterative removal of TFS is equivalent to the associated deferred acceptance algorithm if and only if the latter is a Pareto efficient mechanism. Keywords: Deferred acceptance algorithm, Pareto efficiency, School choice, Strategy-proofness, Top trading cycle. JEL Codes: C78, D61, D78, I20. Click here to view the CV.
		PRESENTER Qianfeng Tang Shanghai University of Finance and Economics
		RESEARCH FIELDS Microeconomic Theory Game Theory Market Design
		DATE: 11 April 2019 (Thursday)
		TIME: 4pm - 5.30pm
		VENUE: Meeting Room 5.1, Level 5 School of Economics Singapore Management University 90 Stamford Road Singapore 178903