Enrollment manipulations in school choice

Abstract

Schools are motivated to have greater enrollment numbers through giving funds increasing with enrollments and the closure possibility in the case of low enough enrollment numbers. Schools, therefore, have strong incentives to keep their enrollments as high as possible. To this end, indeed, it is documented that educational institutions might commit fraud. These facts call for strategic behaviors of schools to increase their enrollments. Motivated by the New York City School Choice system, where schools can arrange their priorities, this paper investigates whether schools can increase their enrollments by misreporting their priorities under the prominent mechanisms: Boston, Top Trading Cycles, and Stable rules. We show that while Boston and Stable rules (in particularly, the student-optimal stable mechanism) are immune to enrollment manipulations, Top Trading Cycles mechanism is vulnerable. Hence, the current paper adds another dimension to the ongoing debate of which mechanism should be used in real-life school choice problems by identifying an important disadvantage of Top Trading Cycles mechanism against Boston and especially the student-optimal stable mechanism.