Market Design for Distributional Objectives in (Re)assignment: An Application to Improve the Distribution of Teachers in Schools

Centralized (re)assignment of workers to jobs is increasingly common in public and private sectors. However, these markets often suffer from distributional problems. The authors propose a new strategy-proof mechanism that efficiently improves individual and distributional welfare over the status quo. The authors justify our constructive and practical approach by micro-founding it through the theory of inequality measures in welfare economics. To evaluate the performance of our mechanism, they focus on teacher (re)assignment, where the unequal distribution of experienced teachers across schools is a well-documented concern. Using French data, the authors demonstrate that our mechanism reduces the teacher experience gap across regions more effectively than benchmarks, including the current mechanism, while providing higher average welfare for teachers.