Should College Admissions Favor Low-Income Applicants?

55 Pages Posted: 14 Jul 2015 Last revised: 22 Mar 2019

See all articles by Bernard Herskovic

Bernard Herskovic

University of California, Los Angeles (UCLA) - Anderson School of Management

Joao Ramos

Marshall School of Business - University of Southern California

Date Written: March 18, 2019

Abstract

College admissions should also base their decisions on applicants' income as affirmative action targeting low-income applicants is a powerful policy to reduce intergenerational persistence of earnings and to improve both welfare and aggregate output. We construct an overlapping-generations model in which parents choose how much to invest in their child's education, thereby increasing both human capital and likelihood of college admission. Affirmative action improves the pool of admitted students, however it distorts incentives towards educational investments. Using the model at calibrated parameters, we quantify the long-run effects of optimal income-based affirmative action policies.

Keywords: Affirmative Action, Intergenerational Mobility, Educational Investment

JEL Classification: I2, E24, J62

Suggested Citation

Herskovic, Bernard and Ramos, Joao, Should College Admissions Favor Low-Income Applicants? (March 18, 2019). Available at SSRN: https://ssrn.com/abstract=2628303 or http://dx.doi.org/10.2139/ssrn.2628303

Bernard Herskovic (Contact Author)

University of California, Los Angeles (UCLA) - Anderson School of Management ( email )

Los Angeles, CA 90095-1481
United States

HOME PAGE: http://bernardherskovic.com

Joao Ramos

Marshall School of Business - University of Southern California ( email )

701 Exposition Boulevard, STE 205
Los Angeles, CA 90089-1422
United States

HOME PAGE: http://www.joaoaramos.com/

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