Deferred acceptance and regret-free truth-telling

Marcelo Ariel Fernandez

Economics Working Paper Archive from The Johns Hopkins University,Department of Economics

Abstract: The deferred acceptance mechanism has been widely adopted across centralized matching markets, despite the fact that it provides participants with opportunities to “game the system.” Accounting for the lack of information that participants typically have in these markets in practice, I introduce a new notion of behavior under uncertainty that captures participants’ aversion to experience regret. I show that participants optimally choose not to manipulate the deferred acceptance mechanism in order to avoid regret. Moreover, the deferred acceptance mechanism is the unique mechanism within an interesting class (quantile-stable) to induce honesty from participants in this way.

Keywords: Market design; Deferred acceptance; Gale-Shapley; Regret; Regret-Free; Regret-FreeTruth-Telling; Manipulation; Stable mechanisms; two-sided matching (search for similar items in EconPapers)
JEL-codes: C78 D47 D81 D82 D91 (search for similar items in EconPapers)
Date: 2018-06-01, Revised 2020-07-31
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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