Abstract
Stochastically arriving objects (e.g. transplant organs, public housing units) often are allocated via waiting lists exhibiting deferral rights: agents may decline offers, keeping their position in line. We consider the welfare implications of bestowing or constraining such rights, concluding that their desirability depends—in opposite ways—on agents' risk-aversion and impatience. Under risk-aversion, uninfluenced deferral rights typically enhance welfare. Under discounting some restrictions on deferral rights can benefit all agents joining the list. In a stylized “organ spoilage” model our results demonstrate that policy evaluations should not be based solely on throughput metrics (e.g. organ utilization rates) that ignore such preference characteristics.
Original language | English (US) |
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Article number | 105263 |
Journal | Journal of Economic Theory |
Volume | 195 |
DOIs | |
State | Published - Jul 2021 |
Funding
I thank Hyoduk Shin for a discussion that motivated this paper, and Philip Marx and Edwin Munoz-Rodriguez for research assistance. The excellent comments of two referees led to considerable improvement in the paper. Helpful comments were provided by Nick Arnosti, Anna Bogomolnaia, Ozan Candogan, Eun Jeong Heo, Edwin Munoz-Rodriguez, Tayfun S?nmez, Kathy Spier, and seminar participants at Duke (Fuqua), N.C. State, Paris School of Economics, Rochester, and Vanderbilt.
Keywords
- Dynamic assignment
- Queueing
- Waiting lists
ASJC Scopus subject areas
- Economics and Econometrics