A Pseudo-Market Approach to Allocation with Priorities

YingHua He, Antonio Miralles, Marek Pycia and Jianye Yan

American Economic Journal: Microeconomics, 2018, vol. 10, issue 3, 272-314

Abstract: We propose a pseudo-market mechanism for no-monetary-transfer allocation of indivisible objects based on priorities such as those in school choice. Agents are given token money, face priority-specific prices, and buy utility-maximizing random assignments. The mechanism is asymptotically incentive compatible, and the resulting assignments are fair and constrained Pareto efficient. Aanund Hylland & Richard Zeckhauser (1979)'s position-allocation problem is a special case of our framework, and our results on incentives and fairness are also new in their classical setting.

JEL-codes: D63 D82 H75 I21 I28 (search for similar items in EconPapers)
Date: 2018
Note: DOI: 10.1257/mic.20150259
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Citations: View citations in EconPapers (27)

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