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Affirmative action in contest games

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  • Franke, Jörg

Abstract

This paper analyzes the incentive effects of affirmative action in competitive environments. Competition is between heterogeneous players in a contest game where heterogeneity might be due to past discrimination. Two policy options are analyzed that tackle the underlying asymmetry: either it is ignored and the contestants are treated equally, or affirmative action is implemented to neutralize the disadvantages of discriminated players. Comparing the induced effort exertion under the two policies reveals that in a two-player contest game the normative neutralization objective of affirmative action coincides with higher effort exertion. However, in the multi-player contest affirmative action might have adverse incentive effects as the participation of additional weak players detrimentally affects effort incentives of other players. These results also obtain under imperfect information of the contest organizer.

Suggested Citation

  • Franke, Jörg, 2012. "Affirmative action in contest games," European Journal of Political Economy, Elsevier, vol. 28(1), pages 105-118.
    • Handle: RePEc:eee:poleco:v:28:y:2012:i:1:p:105-118
    DOI: 10.1016/j.ejpoleco.2011.07.002
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    More about this item

    Keywords

    Asymmetric contest; Affirmative action; Discrimination;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)

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