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13 - School Matching and Learning under the Influence of Intergenerational Advice

from Part V - Advice and Economic Mechanisms

Published online by Cambridge University Press:  09 March 2023

Andrew Schotter
Affiliation:
New York University
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Summary

While the mechanisms that economists design are typically static, one-shot games, in the real world, mechanisms are used repeatedly by generations of agents who engage in them for a short period of time and then pass on advice to their successors. Hence, behavior evolves via social learning and may diverge dramatically from that envisioned by the designer. We demonstrate that this is true of school matching mechanisms – even those for which truth-telling is a dominant strategy. Our results indicate that experience with an incentive-compatible mechanism may not foster truthful revelation if that experience is achieved via social learning.

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Publisher: Cambridge University Press
Print publication year: 2023

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