Confidence and Information in Strategy-Proof School Choice

Müge Süer, Michel Tolksdorf, Vincent Meisner and Sokol Tominaj
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Müge Süer: IWH Halle
Michel Tolksdorf: TU Berlin
Vincent Meisner: HU Berlin
Sokol Tominaj: TU Berlin

No 546, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: Contrary to classical theory, we provide experimental evidence that preference reports in a strategy-proof school-choice mechanism systematically depend on beliefs. We employ a "hard-easy gap" to exogenously vary students' beliefs about their priority rank. As predicted, underconfidence induces more manipulation and thus more justified envy than overconfidence. The effect of priority information on justified envy crucially depends on the initial beliefs and the real priority ranks: while top students always gain, non-top students lose from this information. In total, correcting overconfidence/underconfidence increases/decreases justified envy. Finally, we confirm that additionally providing information on school availability through a dynamic implementation of the mechanism reduces justified envy compared to priority information alone.

Keywords: market design; school choice; overconfidence; strategy-proofness; information (search for similar items in EconPapers)
JEL-codes: C92 D47 (search for similar items in EconPapers)
Date: 2025-09-25
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