The Matching Mechanism With Unequal Outside Options

In the past few decades,matching market has become a hot research topic,and the matching theory has also come to our notice.At present,the matching theory has been widely used in public school choice and labor markets both at home and abroad.The admission mechanism of Chinese College Entrance Examination is one of the matching mechanisms,which is considered to be one of the largest and most far-reaching matching mechanisms in the world today.The conventional researches usually assume that there are no outside options for market participants,which,in practice,are often influenced by external markets.Theoretical researches show that individual behaviors will be significantly different under the non-strategy-proof matching mechanism with unequal outside options,and the matching outcome will also be affected by the unequal outside options.In this paper,the matching theory with outside options is studied by laboratory experiments.To explore the impact of unequal outside options on participants’ personal behavior and matching outcomes,so as to provide a new perspective for the experimental research framework of matching mechanism,this paper re-compares the Boston mechanism and the Delayed Acceptance mechanism,which are two typical matching mechanisms,in three experimental environments with unequal outside options.This study shows that(1)although the truth-telling rates of the two types of participants under Delayed Acceptance mechanism are different,which is not the same as the theoretical predictions,the difference of the truth-telling rates under Delayed Acceptance mechanism is still significantly smaller than that under the Boston mechanism.(2)Participants with outside options always get more opportunities to go to better public schools under Boston mechanism,which leads to participants without outside options having fewer opportunities to go to better public schools.On the contrary,the matching outcomes under Delayed Acceptance mechanism will not produce such unequality.(3)Participants with outside options always get higher expected returns under Boston mechanism.(4)For participants without outside options,the expected returns under the two mechanisms depend on the experimental environment.In lots of classical literature,theories and experiments are complementary to each other.We hope that this experimental study can make more people pay attention to the existence of outside options and its impact on the central matching market.From the policy perspective,it is important to recognize outside options in other markets when establishing or selecting matching mechanisms.