Effective Affirmative Action in School Choice

43 Pages Posted: 10 Apr 2011 Last revised: 29 Apr 2012

See all articles by Isa Emin Hafalir

Isa Emin Hafalir

Carnegie Mellon University - David A. Tepper School of Business

M. Bumin Yenmez

Boston College

Muhammed Ali Yildirim

Harvard University - Harvard Kennedy School (HKS)

Date Written: April 9, 2011

Abstract

The prevalent affirmative action policy in school choice limits the number of admitted majority students to give minority students higher chances to attend their desired schools. There have been numerous efforts to reconcile affirmative action policies with celebrated matching mechanisms such as the deferred acceptance and top trading cycles algorithms. Nevertheless, it is theoretically shown that under these algorithms, the policy based on majority quotas may be detrimental to minorities. Using simulations we find that this is a more common phenomenon rather than a peculiarity -- up to 25% of minorities and 55% of majorities can be worse off. To circumvent the inefficiency caused by majority quotas, we offer a different interpretation of the affirmative action policies based on minority reserves. With minority reserves, schools give higher priority to minority students up to the point that the minorities fill the reserves. We compare the welfare effects of these policies. The deferred acceptance algorithm with minority reserves Pareto dominates the one with majority quotas. Our simulations, which allows for correlations between student preferences and school priorities, indicate that minorities are on average better off with minority reserves while adverse effects on majorities are mitigated.

Keywords: School Choice, Affirmative Action

JEL Classification: C78, D61, D78, I20

Suggested Citation

Hafalir, Isa Emin and Yenmez, M. Bumin and Yildirim, Muhammed Ali, Effective Affirmative Action in School Choice (April 9, 2011). Available at SSRN: https://ssrn.com/abstract=1806084 or http://dx.doi.org/10.2139/ssrn.1806084

Isa Emin Hafalir (Contact Author)

Carnegie Mellon University - David A. Tepper School of Business ( email )

5000 Forbes Avenue
Pittsburgh, PA 15213-3890
United States

M. Bumin Yenmez

Boston College ( email )

140 Commonwealth Ave.
Maloney Hall 327
Chestnut Hill, MA 02467
United States

Muhammed Ali Yildirim

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States

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