Diversity Preferences, Affirmative Action and Choice Rules

30 Pages Posted: 20 Jul 2022 Last revised: 18 Aug 2022

See all articles by Oguzhan Celebi

Oguzhan Celebi

Massachusetts Institute of Technology (MIT) - Department of Economics

Date Written: July 8, 2022


Many institutions implement affirmative action programs when hiring individuals or allocating resources, indicating a preference for diversity as well as quality. I introduce a framework to analyze diversity preferences and their effect on the affirmative action policies and choice rules adopted by these institutions. I characterize the choice rules that can be rationalized by diversity preferences and demonstrate that the rule that has been used to allocate government positions in India cannot be rationalized. I show that if institutions evaluate diversity using marginal, and not cross-sectional distribution of identities, then choices induced by their preferences cannot satisfy the substitutes condition, which is crucial for the existence of competitive equilibria and stable allocation in many settings. I characterize a class of choice rules that satisfy the substitutes condition and are rationalizable by preferences that evaluate diversity and quality separately and identify the preferences that induce some widely used choice rules. My results provide a systematic way of evaluating the diversity preferences behind the choices made by institutions.

Keywords: Matching Theory, Market Design, Affirmative Action

JEL Classification: C78, D47, J15

Suggested Citation

Celebi, Oguzhan, Diversity Preferences, Affirmative Action and Choice Rules (July 8, 2022). Available at SSRN: https://ssrn.com/abstract=4158066 or http://dx.doi.org/10.2139/ssrn.4158066

Oguzhan Celebi (Contact Author)

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

50 Memorial Drive
Cambridge, MA 02142
United States

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