A field evaluation of a matching mechanism: University applicant behavior in Australia.

The majority of undergraduate university applications in the state of New South Wales-Australia's largest state-are processed by a clearinghouse, the Universities Admissions Centre (UAC). Applicants submit an ordered list of degrees to the UAC, which applies a matching algorithm to allocate university places to eligible applicants. Applicants receive advice on how to construct their degree preference list from multiple sources including individual universities. This advice is often confusing and misleading. To evaluate the performance of the current system, we run a large sample (832 observations) online experiment with experienced participants in a choice environment that mimics the UAC application process, and in which truth telling is optimal. We vary the advice received across treatments: no advice, the UAC advice only, an instance of misleading university advice only, and both the UAC and the misleading university advice together. Overall, 75.5% of participants fail to behave in their best interest. High rates of applicant manipulation persist even when applicants are provided with the UAC's accurate advice. Students who attend nonselective government high schools are more prone to use strictly dominated strategies than those who attend academically selective government high schools and private high schools.