The welfare effects of centralized school choice in NYC, by Abdulkadiroglu, Agarwal and Pathak in the AER

from Market Design at on November 29, 2017 at 01:58PM

The Abdulkadiroglu, Agarwal and Pathak paper on the effects of school choice in NYC has now come out in the December 2017 AER ( 107(12): 3635–3689).

They find substantial welfare effects in moving from NYC’s old decentralized high school choice system (in which individual schools made uncoordinated acceptance decisions, so some students received multiple offers while others got none) to the stable matching system (using the deferred acceptance algorithm with single tie-breaking) now used. They don’t find big gains from trying to reach a student optimal stable matching by revising the tie-breaking decisions.

The Welfare Effects of Coordinated Assignment:Evidence from the New York City High School Match
By Atila Abdulkadiroglu, Nikhil Agarwal, and Parag A. Pathak

"Coordinated  single-offer  school  assignment  systems  are  a  popular  education  reform.  We  show  that  uncoordinated  offers  in  NYC’s  school  assignment  mechanism  generated  mismatches.  One-third  of  applicants were unassigned after the main round and later administratively placed at less desirable schools. We evaluate the effects of the new coordinated mechanism based on deferred acceptance using estimated student preferences. The new mechanism achieves 80 per-cent of the possible gains from a no-choice neighborhood extreme to a utilitarian benchmark. Coordinating offers dominates the effects of further algorithm modifications. Students most likely to be previously administratively  assigned  experienced  the  largest  gains  in  welfare  and subsequent achievement."

Here’s the ungated working paper