Nils Lager: Which schools would take me? Truth-telling in School Choice with Admission
Time: Thu 2021-06-03 09.30 - 10.30
Location: Meeting ID: 697 4204 2109
Respondent: Nils Lager
In school choice systems all over the world, the deferred acceptance procedure is becoming more popular. One of the reasons for this is that students will always have incentives to submit their true preference order under this mechanism. However, Fack et al (2019) showed that this result is restricted to when students do not experience any costs for applying to a large amount of schools. When allowing students to have an application cost, students may "skip the impossible" and not apply to selective schools, despite preferring them to other schools that they apply to. This causes problems for policy makers when estimating students' preferences and when trying to simulate outcomes from alternative admission rules. But when does this hurt the truth-telling assumption? Here, I build a model where students also have uncertainty regarding their admissions probability. I show that students are more likely to "skip the impossible" when they have a low degree of uncertainty of their admission probability, or are underestimating it. When students have a high degree of uncertainty or are overestimating their admission probabilities, the truth-telling assumption is more likely to hold.
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