Deduction Dilemmas: The Taiwan Assignment Mechanism

Abstract

This paper analyzes the Taiwan mechanism used nationwide for high school assignment starting in 2014. In the Taiwan mechanism, points are deducted from an applicant’s score, with larger penalties for lower-ranked choices. Deduction makes the mechanism a hybrid of the Boston and deferred acceptance mechanisms. Our analysis sheds light on why Taiwan’s new mechanism has led to massive nationwide demonstrations and why it nonetheless remains in use. (JEL D47, I21, I28)