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Diversity and Affirmative Action in Higher Education

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  • DENNIS EPPLE
  • RICHARD ROMANO
  • HOLGER SIEG

Abstract

We examine the practice of affirmative action and consequences of its proscription on the admission and tuition policies of institutions of higher education in a general equilibrium framework. Colleges are differentiated ex ante by endowments and compete for students that differ by race, household income, and academic qualification. Proscription of affirmative action requires that admission and tuition policies are race blind. Colleges then use the informational content about race in income and academic qualification in reformulating their optimal policies. We find that minority students pay lower tuition and attend higher-quality schools because of affirmative action. A ban of affirmative action will lead to a substantial decline of minority students in the top-tier colleges. Copyright © 2008 Wiley Periodicals, Inc..

Suggested Citation

  • Dennis Epple & Richard Romano & Holger Sieg, 2008. "Diversity and Affirmative Action in Higher Education," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(4), pages 475-501, August.
  • Handle: RePEc:bla:jpbect:v:10:y:2008:i:4:p:475-501
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    References listed on IDEAS

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    Cited by:

    1. Debraj Ray & Rajiv Sethi, 2010. "A Remark on Color-Blind Affirmative Action," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(3), pages 399-406, June.
    2. Arcidiacono, Peter & Aucejo, Esteban & Coate, Patrick & Hotz, V. Joseph, 2012. "Affirmative Action and University Fit: Evidence from Proposition 209," IZA Discussion Papers 7000, Institute for the Study of Labor (IZA).
    3. Chan, Jimmy & Eyster, Erik, 2007. "The Distributional Consequences of Diversity-Enhancing University Admissions Rules," CEPR Discussion Papers 6278, C.E.P.R. Discussion Papers.
    4. Liu, Liqun & Neilson, William S., 2011. "High scores but low skills," Economics of Education Review, Elsevier, vol. 30(3), pages 507-516, June.
    5. repec:ucp:jpolec:doi:10.1086/691702 is not listed on IDEAS
    6. Pastine, Ivan & Pastine, Tuvana, 2012. "Student incentives and preferential treatment in college admissions," Economics of Education Review, Elsevier, vol. 31(1), pages 123-130.
    7. Peter Arcidiacono & Michael Lovenheim, 2016. "Affirmative Action and the Quality-Fit Trade-Off," Journal of Economic Literature, American Economic Association, vol. 54(1), pages 3-51, March.
    8. Dario Cestau & Dennis Epple & Holger Sieg, 2017. "Admitting Students to Selective Education Programs: Merit, Profiling, and Affirmative Action," Journal of Political Economy, University of Chicago Press, vol. 125(3), pages 761-797.
    9. Yagan, Danny, 2016. "Supply vs. demand under an affirmative action ban: Estimates from UC law schools," Journal of Public Economics, Elsevier, vol. 137(C), pages 38-50.
    10. Arcidiacono, Peter & Khan, Shakeeb & Vigdor, Jacob L., 2011. "Representation versus assimilation: How do preferences in college admissions affect social interactions?," Journal of Public Economics, Elsevier, vol. 95(1-2), pages 1-15, February.
    11. Surendrakumar Bagde & Dennis Epple & Lowell Taylor, 2016. "Does Affirmative Action Work? Caste, Gender, College Quality, and Academic Success in India," American Economic Review, American Economic Association, vol. 106(6), pages 1495-1521, June.
    12. repec:eee:pubeco:v:155:y:2017:i:c:p:164-178 is not listed on IDEAS
    13. Dennis Epple & Richard Romano & Sinan Sarpça & Holger Sieg, 2013. "The U.S. Market for Higher Education: A General Equilibrium Analysis of State and Private Colleges and Public Funding Policies," NBER Working Papers 19298, National Bureau of Economic Research, Inc.

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