#ZEWPodcast: On Your Spots, Get Set, Go? How Day Care Spots Can Be Successfully Allocated
#ZEWPodcastZEW Podcast with Thilo Klein
Beginning on their first birthday, children in Germany are technically entitled to a spot in a day care centre. But this right does not always come to fruition: The search for a day care spot is time-consuming and nerve-wrecking for many parents, and some children come away empty-handed at first. The day care allocation system urgently needs to be optimised. But how can day care spots be assigned more quickly and fairly? Market design expert Thilo Klein explains in the ZEW podcast that, with the help of the software tool KitaMatch, day care spots can be allocated more efficiently than
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To start off the podcast, Professor Thilo Klein, researcher in ZEW’s “Market Design” Unit says, “it’s important to have a functional child care market.” But he contrasts this desired condition with the status quo:“That is obviously not the case at the moment.” That is to say, the search for a day care spot often translates to long waiting times, which in turn create uncertainty for parents as well as their employers. However, especially against the backdrop of demographic change, the labour force participation of parents in general and women in particular is of high importance.
Lack of uniformity in allocation processes
Closely related to these difficulties is the lack of uniformity when it comes to allocation processes. This is because local authorities are responsible for planning the distribution of day care centre spots. Through a first-come, first-served process, parents are allowed to independently specify desired day care centres, but they cannot list them in order of preference. “That seems a bit behind the times,” notes Klein, since “that would be like going to the bakery and letting the employees decide which bread to give me.” A method called the Boston Process already allows parents to rank their day care centre choices. However, it still has a crucial flaw. Parents often do not list their actual favourite day care as their top choice, but instead a less-preferred one, because they would otherwise risk not receiving a spot at all. Thus, the main processes that have been used up to now are not optimal.
KitaMatch resolves unfairness
The Gale-Shapely algorithm is an already well-established solution to the allocation problem for study places at schools and universities. However, the algorithm hasn’t been implemented yet for day care spots. “The day care providers have a strong desire to maintain their autonomy” says Klein, pointing to the preference of day care centres to decide for themselves who they let in. That’s why the challenge for Klein and his colleagues consisted of “constructing a process that makes a compromise possible.” The result is the software program KitaMatch. First, parents submit a list of day care centres ranked according to their preferences to the local authorities. Based on parents’ preferences, the municipality then creates a ranking according to which the parents should receive offers. On a subsequent “Matching Day,” the heads of the day care centres meet to internally allocate the available spots. The actual acceptances and rejections for the parents follow subsequently. The key to success lies in the fact that the day care centres can adapt the ranked lists at any time. KitaMatch has already been successfully implemented in several municipalities. “But this also means that in the remaining 80 major cities, suboptimal procedures are still being used,” Klein concluded the podcast.
