School Choice: Nash Implementation of Stable Matchings through Rank-Priority Mechanisms

• Authors: Flip Klijn.
• BSE Working Paper: 112149 | March 17
• Keywords: stability , school choice , rank-priority mechanisms , Nash implementation
• JEL codes: C78, D61, D78, I20
• stability
• school choice
• rank-priority mechanisms
• Nash implementation

We consider school choice problems (Abdulkadiroğlu and Sönmez, 2003) where students are assigned to public schools through a centralized assignment mechanism. We study the family of so-called rank-priority mechanisms, each of which is induced by an order of rank-priority pairs. Following the corresponding order of pairs, at each step a rank-priority mechanism considers a rank-priority pair and matches an available student to an unfilled school if the student and the school rank and prioritize each other in accordance with the rank-priority pair. The Boston or immediate acceptance mechanism is a particular rank-priority mechanism. Our first main result is a characterization of the subfamily of rank-priority mechanisms that Nash implement the set of stable (i.e., fair) matchings (Theorem 1). We show that our characterization also holds for “sub-implementation” and “sup-implementation” (Corollaries 3 and 4). Our second main result is a strong impossibility result: under incomplete information, no rank-priority mechanism implements the set of stable matchings (Theorem 2).