Constrained School Choice



8 Equilibria in Truncations

In this section we focus on “truncation” strategies which are shown to be undominated
in the quota-games induced by both the Student-Optimal Stable mechanism and the Top
Trading Cycles mechanism. We first strengthen the negative side of Theorems 6.5 and 6.8
by providing and example that admits a strong Nash equilibrium in truncations that
induces an unstable matching. Next, again for both mechanisms, we will show that in
general there is also no relation between the set of unassigned students at equilibrium
and the set of unassigned students in stable matchings. However, for Nash equilibria in
truncations we do obtain a positive result in this respect for the Student-Optimal Stable
mechanism.

A truncation of a preference list Pi is a list Pi' obtained from Pi by deleting some school
and all less preferred acceptable schools.
20 The following lemma says that in the games
Γ
γ(P, k) and Γτ (P, k) submitting a truncation “as long as possible” is k-undominated.
Formally, student
i’s strategy Qi Q(k) is k-dominated by another strategy Qi Q(k)
if
φ(Qi,Q-i)Riφ(Qi,Q-i) for all Q-i Q(k)I\i and φ(Q'i, Q-i)Piφ(Qi, Q-i) for some
Q-i Q(k)Ii. A strategy in Q(k) is k-undominated if it is not k-dominated by any other
strategy in
Q(k).

Lemma 8.1 Let P be a school choice problem. Let 1 k m. Let i I be a stu-
dent. Denote the number of (acceptable) schools in
Pi by |Pi |. Then, the strategy Pik of
submitting the first
min{k, |Pi |} schools of the true preference list Pi in the true order is
k-undominated in the games Γγ (P, k) and Γτ (P, k).

Although the strategy profile Pk := (Pik)iI is a profile of k-undominated strategies, it
is not necessarily a Nash equilibrium in the games Γ
γ (P, k) and Γτ (P, k). In case it is a
Nash equilibrium it may still induce an unstable matching as Example 8.2 shows.

Example 8.2 For both γ and τ: A Strong Nash Equilibrium in (Undominated)
Truncations that yields an Unstable Matching

Let I = {i1, i2, i3, i4} be the set of students, S = {s1, s2, s3} be the set of schools, and
q = (1, 1, 1) be the capacity vector. The students’ preferences P and the priority structure
f are given in the table below. Let k = 2 be the quota and Q Q(2)I as given below.

20Truncations have been studied by Roth and Vande Vate (1991), Roth and Rothblum (1999), and
Ehlers (2004) and have also appeared in practice (see for instance Mongell and Roth, 1991).

24



More intriguing information

1. The name is absent
2. Citizenship
3. THE UNCERTAIN FUTURE OF THE MEXICAN MARKET FOR U.S. COTTON: IMPACT OF THE ELIMINATION OF TEXTILE AND CLOTHING QUOTAS
4. Output Effects of Agri-environmental Programs of the EU
5. News Not Noise: Socially Aware Information Filtering
6. The name is absent
7. Testing Gribat´s Law Across Regions. Evidence from Spain.
8. Une nouvelle vision de l'économie (The knowledge society: a new approach of the economy)
9. Insecure Property Rights and Growth: The Roles of Appropriation Costs, Wealth Effects, and Heterogeneity
10. INTERPERSONAL RELATIONS AND GROUP PROCESSES
11. A Dynamic Model of Conflict and Cooperation
12. Neighborhood Effects, Public Housing and Unemployment in France
13. Examining the Regional Aspect of Foreign Direct Investment to Developing Countries
14. Quality practices, priorities and performance: an international study
15. Skill and work experience in the European knowledge economy
16. Investment and Interest Rate Policy in the Open Economy
17. Antidote Stocking at Hospitals in North Palestine
18. Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes
19. The name is absent
20. Expectation Formation and Endogenous Fluctuations in Aggregate Demand