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How Costly Is Diversity? Affirmative Action in Light of Gender Differences in Competitiveness

  • Muriel Niederle

    ()

    (Department of Economics, Stanford University, Stanford, California 94305; and National Bureau of Economic Research, Cambridge, Massachusetts 02138)

  • Carmit Segal

    ()

    (Department of Economics, University of Zurich, CH-8006 Zurich, Switzerland)

  • Lise Vesterlund

    ()

    (Department of Economics, University of Pittsburgh, Pittsburgh, Pennsylvania 15260; and National Bureau of Economic Research, Cambridge, Massachusetts 02138)

Affirmative action is often criticized for causing reverse discrimination and lowering the qualifications of those hired under the policy. However, the magnitude of such adverse effects depends on whether the best suited candidate is hired absent the policy. Indeed affirmative action may compensate for the distortion discrimination imposes on the selection of candidates. This paper asks whether affirmative action can have a similar corrective impact when qualified individuals fail to apply for a job. We evaluate the effect of introducing a gender quota in an environment where high-performing women fail to enter competitions they can win. We show that guaranteeing women equal representation among winners increases their entry. The response exceeds that predicted by the change in probability of winning and is in part driven by women being more willing to compete against other women. The consequences are substantial as the boost in supply essentially eliminates the anticipated costs of the policy. This paper was accepted by Uri Gneezy, behavioral economics.

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File URL: http://dx.doi.org/10.1287/mnsc.1120.1602
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Article provided by INFORMS in its journal Management Science.

Volume (Year): 59 (2013)
Issue (Month): 1 (May)
Pages: 1-16

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Handle: RePEc:inm:ormnsc:v:59:y:2013:i:1:p:1-16
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  1. Andreoni, James & Vesterlund, Lise, 2001. "Which is the Fair Sex? Gender Differences in Altruism," Staff General Research Papers 1951, Iowa State University, Department of Economics.
  2. Uri Gneezy & Muriel Niederle & Aldo Rustichini, 2003. "Performance in Competitive Environments: Gender Differences," The Quarterly Journal of Economics, Oxford University Press, vol. 118(3), pages 1049-1074.
  3. Datta Gupta, Nabanita & Poulsen, Anders & Villeval, Marie Claire, 2005. "Male and Female Competitive Behavior: Experimental Evidence," IZA Discussion Papers 1833, Institute for the Study of Labor (IZA).
  4. David Card & Alan B. Krueger, 2004. "Would the Elimination of Affirmative Action Affect Highly Qualified Minority Applicants? Evidence from California and Texas," NBER Working Papers 10366, National Bureau of Economic Research, Inc.
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  7. Andrea Weber & Christine Zulehner, 2009. "Female Hires and the Success of Start-up Firms," NRN working papers 2009-28, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
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  9. Beaman, Lori & Chattopadhyay, Raghebendra & Duflo, Esther & Pande, Rohini & Topalova, Petia, 2008. "Powerful Women: Does Exposure Reduce Bias?," Working Paper Series rwp08-037, Harvard University, John F. Kennedy School of Government.
  10. Booth, Alison & Nolen, Patrick, 2012. "Choosing to compete: How different are girls and boys?," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 542-555.
  11. Coate, S. & Loury, G.C., 1992. "Will Affirmative Action Policies Eliminate Negative Stereotypes?," Papers 3, Boston University - Department of Economics.
  12. Muriel Niederle & Lise Vesterlund, 2005. "Do Women Shy Away from Competition? Do Men Compete too Much?," Discussion Papers 04-030, Stanford Institute for Economic Policy Research.
  13. Kim-Sau Chung, 2000. "Role Models and Arguments for Affirmative Action," American Economic Review, American Economic Association, vol. 90(3), pages 640-648, June.
  14. Devin G. Pope & Justin R. Sydnor, 2010. "Geographic Variation in the Gender Differences in Test Scores," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 95-108, Spring.
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  16. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-74, June.
  17. O. Ashenfelter & D. Card (ed.), 1999. "Handbook of Labor Economics," Handbook of Labor Economics, Elsevier, edition 1, volume 3, number 3.
  18. Roland G. Fryer Jr. & Glenn C. Loury, 2005. "Affirmative Action and Its Mythology," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 147-162, Summer.
  19. Larry Samuelson & George J. Mailath & Avner Shaked, 2000. "Endogenous Inequality in Integrated Labor Markets with Two-Sided Search," American Economic Review, American Economic Association, vol. 90(1), pages 46-72, March.
  20. Muriel Niederle & Lise Vesterlund, 2010. "Explaining the Gender Gap in Math Test Scores: The Role of Competition," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 129-44, Spring.
  21. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  22. Scott E. Page, 2007. "Prologue to The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies
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  23. Harry Holzer & David Neumark, 1999. "Assessing Affirmative Action," NBER Working Papers 7323, National Bureau of Economic Research, Inc.
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