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Not quite the best response: truth-telling, strategy-proof matching, and the manipulation of others

Published online by Cambridge University Press:  14 March 2025

Pablo Guillen  and
Rustamdjan Hakimov Open the ORCID record for Rustamdjan Hakimov [Opens in a new window]
Pablo Guillen
Affiliation:
The University of Sydney, Sydney, Australia
Rustamdjan Hakimov*
Affiliation:
WZB, Berlin Social Science Center, Berlin, Germany
*
[email protected]
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Abstract

Following the advice of economists, school choice programs around the world have lately been adopting strategy-proof mechanisms. However, experimental evidence presents a high variation of truth-telling rates for strategy-proof mechanisms. We crash test the connection between the strategy-proofness of the mechanism and truth-telling. We employ a within-subjects design by making subjects take two simultaneous decisions: one with no strategic uncertainty and one with some uncertainty and partial information about the strategies of other players. We find that providing information about the out-of-equilibrium strategies played by others has a negative and significant effect on truth-telling rates. That is, most participants in our within-subjects design try and fail to best-respond to changes in the environment. We also find that more sophisticated subjects are more likely to play the dominant strategy (truth-telling) across all the treatments. These results have potentially important implications for the design of markets based on strategy-proof matching mechanisms.

Keywords

School choiceTop trading cyclesStrategy-proofnessExperimentsMatching
Type
Original Paper
Information
Experimental Economics , Volume 20 , Issue 3 , September 2017 , pp. 670 - 686
Copyright
Copyright © 2016 Economic Science Association

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Footnotes

Electronic supplementary material The online version of this article (doi:https://doi.org/10.1007/s10683-016-9505-0) contains supplementary material, which is available to authorized users.

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