Reversing Reserves

48 Pages Posted: 13 Apr 2020 Last revised: 5 Mar 2021

See all articles by Parag A. Pathak

Parag A. Pathak

Massachusetts Institute of Technology (MIT) - Department of Economics

Alex Rees-Jones

Cornell University - Department of Economics; National Bureau of Economic Research (NBER)

Tayfun Sonmez

Boston College

Date Written: April 2020

Abstract

Affirmative action policies are often implemented through reserve systems. We contend that the functioning of these systems is counterintuitive, and that the consequent misunderstanding leads individuals to support policies that ineffectively pursue their goals. We present 1,013 participants in the Understanding America Study with incentivized choices between reserve policies that vary in all decision-relevant parameters. Many choices are rationalized by a nearly correct decision rule, with errors driven solely by the incorrect belief that reversing the processing order has no effect. The prevalence of this belief helps to explain otherwise surprising decisions made in field applications of reserve systems.

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Suggested Citation

Pathak, Parag A. and Rees-Jones, Alex and Sonmez, Tayfun, Reversing Reserves (April 2020). NBER Working Paper No. w26963, Available at SSRN: https://ssrn.com/abstract=3574428

Parag A. Pathak (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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E52-391
Cambridge, MA 02142
United States

Alex Rees-Jones

Cornell University - Department of Economics ( email )

Ithaca, NY 14853
United States

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

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Tayfun Sonmez

Boston College ( email )

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