New axioms for top trading cycles
Theoretical Economics
2021-07-01 v3
Abstract
School choice is of great importance both in theory and practice. This paper studies the (student-optimal) top trading cycles mechanism (TTCM) in an axiomatic way. We introduce two new axioms: MBG (mutual best group)-quota-rationality and MBG-robust efficiency. While stability implies MBG-quota-rationality, MBG-robust efficiency is weaker than robust efficiency, which is stronger than the combination of efficiency and group strategy-proofness. The TTCM is characterized by MBG-quota-rationality and MBG-robust efficiency. Our results construct a new basis to compare the TTCM with the other school choice mechanisms, especially the student-optimal stable mechanism under Ergin but not Kesten-acyclic priority structures.
Cite
@article{arxiv.2104.09157,
title = {New axioms for top trading cycles},
author = {Siwei Chen and Yajing Chen and Chia-Ling Hsu},
journal= {arXiv preprint arXiv:2104.09157},
year = {2021}
}