Experimental School Choice with Parents

TL;DR

This study experimentally compares three school choice mechanisms with parents as subjects, revealing manipulation behaviors, efficiency-stability tradeoffs, and the impact of cognitive ability on outcomes.

Contribution

First laboratory experiment with parents as decision makers comparing DA, EADA, and RM mechanisms, highlighting manipulation patterns and welfare implications.

Findings

All mechanisms are frequently manipulated.

DA produces stable but inefficient allocations.

RM achieves efficiency at a stability cost.

Abstract

We conduct the first laboratory school choice experiment in which parents-the relevant decision makers in the field-are the experimental subjects. We compare Deferred Acceptance (DA) with two manipulable but potentially more efficient alternatives: Efficiency-Adjusted Deferred Acceptance (EADA) and the Rank-Minimizing mechanism (RM). We find that all mechanisms are frequently manipulated, with no significant differences in truth-telling rates. Parents and students manipulate at similar rates, supporting the external validity of student-based experiments, though students make significantly more obvious errors, suggesting parents' deviations are more deliberate. Despite widespread manipulation, the predicted welfare-stability tradeoff largely survives: DA never produces Pareto-efficient allocations yet generates little justified envy; whereas RM delivers substantial efficiency gains at a meaningful stability cost. EADA occupies a middle ground: its efficiency gains over DA are modest and imprecisely estimated yet double justified envy. Higher cognitive ability is associated with more deviations, and under EADA with worse outcomes. While DA does not induce truth-telling, it is the only mechanism in which manipulation never pays off and rarely changes outcomes.