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Does Affirmative Action Reduce Effort Incentives? – A Contest Game Analysis

Listed author(s):
  • Franke, Jörg

This paper analyzes the incentive effects of affirmative action in competitive environments modeled as contest games. Competition is between heterogeneous players 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 which compensates discriminated players. It is shown in a simple two-player contest game that a tradeoff between affirmative action and high effort exertion does not exist. Instead, the implementation of affirmative action fosters effort incentives. Similar results hold in the n-player contest as well as under imperfect information if the heterogeneity between contestants is moderate.

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File URL: https://www.econstor.eu/bitstream/10419/37008/1/625503503.pdf
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Paper provided by RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen in its series Ruhr Economic Papers with number 185.

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Date of creation: 2010
Handle: RePEc:zbw:rwirep:185
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  2. Andrew Schotter & Keith Weigelt, 1992. "Asymmetric Tournaments, Equal Opportunity Laws, and Affirmative Action: Some Experimental Results," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 511-539.
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  6. Calsamiglia, Caterina & Franke, Jörg & Rey-Biel, Pedro, 2013. "The incentive effects of affirmative action in a real-effort tournament," Journal of Public Economics, Elsevier, vol. 98(C), pages 15-31.
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  9. 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.
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  12. Marion, Justin, 2007. "Are bid preferences benign? The effect of small business subsidies in highway procurement auctions," Journal of Public Economics, Elsevier, vol. 91(7-8), pages 1591-1624, August.
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  14. Roland Fryer & Glenn C. Loury & Tolga Yuret, 2003. "Color-Blind Affirmative Action," NBER Working Papers 10103, National Bureau of Economic Research, Inc.
  15. Qiang Fu, 2006. "A Theory of Affirmative Action in College Admissions," Economic Inquiry, Western Economic Association International, vol. 44(3), pages 420-428, July.
  16. Stefan Szymanski, 2003. "The Economic Design of Sporting Contests," Journal of Economic Literature, American Economic Association, vol. 41(4), pages 1137-1187, December.
  17. Nitzan, Shmuel, 1994. "Modelling rent-seeking contests," European Journal of Political Economy, Elsevier, vol. 10(1), pages 41-60, May.
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