Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/244329 
Year of Publication: 
2021
Series/Report no.: 
Discussion Paper No. 289
Publisher: 
Ludwig-Maximilians-Universität München und Humboldt-Universität zu Berlin, Collaborative Research Center Transregio 190 - Rationality and Competition, München und Berlin
Abstract: 
Despite the truthful dominant strategy, participants in strategy-proof me- chanisms submit manipulated preferences. In our model, participants dislike rejections and enjoy the confirmation from getting what they declared most desirable. Formally, the payoff from a match decreases in its position in the submitted ranking such that a strategic trade-off between preference intensity and match probability arises. This trade-off can trigger the commonly observed self-selection strategies. We show that misrepresentations can persist for arbitrarily small report-dependent components. However, honesty is guaranteed to be optimal if and only if there is no conflict between the quality and feasibility of a match.
Subjects: 
Market design
matching
school choice
self-regarding preferences
strategy-proof mechanisms
JEL: 
D47
D78
D81
D91
Document Type: 
Working Paper

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