When Words Move Rankings: Strategic Messaging in Matching Markets
Deferred Acceptance (DA) mechanisms are widely implemented in centralised matching markets, where the proposing side is deliberately chosen to ensure strategy-proofness for proposers and the proposer-optimal stable matching. In practice, however, pre-match communication from the receiving side indicating strong interest — such as “ranked-to-match” messages in the NRMP — is prevalent. In a laboratory experiment with candidate–firm matching and candidate-proposing DA, we find that firms strategically target messages toward their firm-optimal stable matching partners, while candidates respond by ranking messaging firms higher. Together, these behaviours shift market outcomes away from the candidate-optimal and toward the firm-optimal stable matching, with statistically significant effects when messages are committed, meaning that firms must rank the message recipient first. Our findings identify pre-match communication as a novel form of manipulation outside the matching mechanism and show that it can undermine the objectives that market designers seek to achieve.
Key takeaway
“Even seemingly innocuous communication can undermine market designers’ objectives.”
Market designers should look beyond the mechanism and consider the broader environment.
↻ Click to flipThe mechanism
Stylised example: A candidate's preference is A ≻ B ≻ C, Assume Firm A is candidate-optimal match, and Firm C is firm-optimal.
Classical theory
Preference = ROL
matched · Firm A
the candidate-optimal match
Behavioural strategy
Message the firm-optimal partner, before ROL submission
Behavioural response
ROL ≠ Preference
the candidate misreports in the messaging firm’s favour
Market outcome
matched · Firm C
the firm-optimal match
Pre-match messaging acts as a low-risk behavioural manipulation: candidates deviate from truth-telling to favour the messaging firm, shifting the equilibrium to a firm-optimal stable matching — both of the designer’s objectives fail.
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