School Choice: A Mechanism Design Approach

Abstract

A central issue in school choice is the design of a student assignment mechanism. Education literature provides guidance for the design of such mechanisms but does not offer specific mechanisms. The flaws in the existing school choice plans result in appeals by unsatisfied parents. We formulate the school choice problem as a mechanism design problem and analyze some of the existing school choice plans including those in Boston, Columbus, Minneapolis, and Seattle. We show that these existing plans have serious shortcomings, and offer two alternative mechanisms each of which may provide a practical solution to some critical school choice issues.

The Welfare Effects of Coordinated Assignment: Evidence from the New York City High School Match

“…The difference in aggregate student welfare under this Pareto-efficient assignment and the student-optimal stable matching may therefore be viewed as the cost of providing incentives for schools for participating in the system. 30 For each of the 100 lottery draws, we calculate a Pareto-efficient matching that dominates each student-optimal stable matching and report the average welfare 30 Balinski and Sönmez (1999) and Abdulkadiroglu and Sönmez (2003) provide an alternative equity rationale for stability. No stable mechanism eliminates strategic participation issues for schools (Sönmez 1997 Notes: Utility from alternative assignments relative to utilitarian optimal assignment computed ignoring all schoolside constraints except capacity.…”

Robust stability in matching markets

“…Roth (1982) shows that any stable mechanism is manipulable. However, if preferences of one side of the market are common knowledge, as in school choice (Abdulkadiroglu and Sönmez 2003) where school priorities are exogenously given by law, the student-optimal stable mechanism is both strategy-proof and stable (Dubins andFreedman 1981, Roth 1982). Indeed, the student-optimal stable mechanism has been adopted in practical assignment problems, such as student assignment in New York City and Boston, and the National Resident Matching Program.…”

The Structure of Priority in the School Choice Problem

“…The algorithm is first applied to the school choice problem by Abdulkadiroglu and Sönmez (2003). The resulting mechanism is called the GaleShapley student-optimal stable mechanism.…”

“…This problem was first formulated as a mechanism design problem by Abdulkadiroglu and Sönmez (2003). Their article and the literature that followed it have led to many school districts adopting mechanisms based on the Deferred Acceptance algorithm and the Top Trading Cycles algorithm.…”