Iterative versus Standard Deferred Acceptance: Experimental Evidence

38 Pages Posted: 29 Oct 2016 Last revised: 11 Nov 2016

Inácio Bó

WZB Berlin Social Science Center

Rustamdjan Hakimov

WZB Berlin Social Science Center

Date Written: November 10, 2016

Abstract

We run laboratory experiments where subjects are matched to colleges, and colleges are not strategic agents. We test the Gale-Shapley Deferred Acceptance (DA) mechanism versus the Iterative Deferred Acceptance Mechanism (IDAM), a matching mechanism based on a new family of procedures being used in the field, in which information about tentative allocations is provided while students make choices. We consider two variations of IDAM: one in which students are informed at each step of the tentative cutoff values for acceptance at each school (IDAM) and one in which they are only informed about whether they are tentatively accepted or not (IDAM-NC). A significantly higher proportion of stable outcomes is reached both under IDAM and IDAM-NC than under DA. The difference can be explained by a higher proportion of subjects following an equilibrium strategy akin to truthful behavior under IDAM and IDAM-NC than truthful behavior itself under DA. Moreover, the provision of intermediate cutoff values in IDAM leads to higher rates of equilibrium behavior than in IDAM-NC. Our findings provide substantial support for the rising practice of using sequential mechanisms in centralized college admissions in practice.

Keywords: Market Design, Matching, Iterative Mechanisms, College Admissions, Experiments

JEL Classification: C78, C92, D63, D78, D82

Suggested Citation

Bó, Inácio and Hakimov, Rustamdjan, Iterative versus Standard Deferred Acceptance: Experimental Evidence (November 10, 2016). Available at SSRN: https://ssrn.com/abstract=2860738 or http://dx.doi.org/10.2139/ssrn.2860738

Inácio Bó (Contact Author)

WZB Berlin Social Science Center ( email )

Reichpietschufer 50
D-10785 Berlin, 10785
Germany

Rustamdjan Hakimov

WZB Berlin Social Science Center ( email )

Reichpietschufer 50
D-10785 Berlin, 10785
Germany

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