Refugee Relocation : A Mechanism Design Approach

Refugee relocation in the European Union relies on mandatory quotas, which assign a fixed share of migrants to each member state. Mandatory quotas have been severely opposed by some national governments for ignoring their preferences on asylum policy. This paper introduces a new mechanism that incorporates preferences and improves upon mandatory quotas. We formally show that it is the unique mechanism that is strategy-proof, Pareto efficient and fair. Our model is a variant of the division problem with single-peaked preferences. The novelty is that the agents may have asymmetric preference domains. This feature is natural at the EU level because countries vary in size