Strategy-Proof Fair School Placement

This paper provides an ‘escape route’ from the efficiency-equity trade-off in the School Choice problem. We achieve our objective by presenting a weak notion of fairness, called τ-fairness, which is always satisfied by some allocation. Then, we propose the adoption of the Student Optimal Compensating Exchange mechanism, a procedure that assigns a τ-fair allocation to each problem. We further identify a condition on students’ preferences guaranteeing incentive compatibility of this mechanism.