Decentralizing Centralized Matching Markets: Implications from Early Offers in University Admissions

Julien Grenet (1, 2) , Yinghua He (3, 4) , Dorothea Kübler (5, 6)

1 PSE - Paris School of Economics
2 PJSE - Paris Jourdan Sciences Economiques
3 Rice University [Houston]
4 TSE-R - Toulouse School of Economics
5 WZB - Social Science Research Center Berlin
6 TU - Technical University of Berlin / Technische Universität Berlin

The matching literature commonly assumes that every agent’s preferences are time-invariant and known to herself at the outset. Consequently, market centralization is preferred. We find counterevidence from a quasi-experiment in Germany's university admissions---a clearinghouse that implements the early stages of the deferred-acceptance mechanism in real time, resembling a decentralized market with continuous offers, rejections, and acceptances. We show that early offers are accepted more often than later ones, despite not being more desirable. These results and survey evidence imply that it is costly for students to learn about universities. We propose a hybrid, welfare-improving mechanism that balances centralization and decentralization.

Mots clés: Centralized Matching Market; Gale-Shapley Deferred Acceptance; Mechanism; University Admissions; Early Offers; Information Acquisition

Domaines: Economies et finances

Julien Grenet, Yinghua He, Dorothea Kübler. Decentralizing Centralized Matching Markets: Implications from Early Offers in University Admissions. 2019. ⟨halshs-02146792v1⟩