LIPIcs.FORC.2023.6.pdf
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Screening with Disadvantaged Agents
Authors
Hedyeh Beyhaghi 
,
Modibo K. Camara ,
Jason Hartline ,
Aleck Johnsen ,
Sheng Long
-
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Volume:
4th Symposium on Foundations of Responsible Computing (FORC 2023)
Series: Leibniz International Proceedings in Informatics (LIPIcs)
Conference: Symposium on Foundations of Responsible Computing (FORC) - License:
Creative Commons Attribution 4.0 International license
- Publication Date: 2023-06-04
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Hedyeh Beyhaghi, Modibo K. Camara, Jason Hartline, Aleck Johnsen, and Sheng Long. Screening with Disadvantaged Agents. In 4th Symposium on Foundations of Responsible Computing (FORC 2023). Leibniz International Proceedings in Informatics (LIPIcs), Volume 256, pp. 6:1-6:20, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2023)
https://doi.org/10.4230/LIPIcs.FORC.2023.6
https://doi.org/10.4230/LIPIcs.FORC.2023.6
Abstract
Motivated by school admissions, this paper studies screening in a population with both advantaged and disadvantaged agents. A school is interested in admitting the most skilled students, but relies on imperfect test scores that reflect both skill and effort. Students are limited by a budget on effort, with disadvantaged students having tighter budgets. This raises a challenge for the principal: among agents with similar test scores, it is difficult to distinguish between students with high skills and students with large budgets.
Our main result is an optimal stochastic mechanism that maximizes the gains achieved from admitting "high-skill" students minus the costs incurred from admitting "low-skill" students when considering two skill types and n budget types. Our mechanism makes it possible to give higher probability of admission to a high-skill student than to a low-skill, even when the low-skill student can potentially get higher test-score due to a higher budget. Further, we extend our admission problem to a setting in which students uniformly receive an exogenous subsidy to increase their budget for effort. This extension can only help the school’s admission objective and we show that the optimal mechanism with exogenous subsidies has the same characterization as optimal mechanisms for the original problem.
Subject Classification
ACM Subject Classification
- Applied computing → Economics
- Theory of computation → Algorithmic mechanism design
Keywords
- screening
- strategic classification
- budgeted mechanism design
- fairness
- effort-incentives
- subsidies
- school admission
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References
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