Homophily in the Job Market and No-Go Results for Affirmative Action
25 Pages Posted: 17 Oct 2017 Last revised: 6 Sep 2019
Date Written: October 4, 2017
Affirmative action policies are often justified on the basis that they are temporary - once the desired level of representation has been achieved, affirmative action can cease and the situation will be self-sustaining. This paper presents no-go results that counter this idea. The model is simple and realistic. It consists of jobs and flows of people between them. It is proven that a representative steady state is unstable under very general conditions. Empirically, inbreeding homophily is ubiquitous and it is sufficient to make the representative steady state unstable. If a central planner wished to implement this perfectly representative steady state, it would require constant affirmative action intervention.
Keywords: affirmative action
JEL Classification: J7, C62, M51
Suggested Citation: Suggested Citation