Reverse Discrimination and Efficiency in Education

Abstract

This paper shows that reverse discrimination policies can find a justification purely on efficiency grounds. We study the optimal provision of education when households belong to different groups, differing in the distribution of the potential to benefit from education among individuals, which is private information. The main result is that the high potential individuals from groups with relatively few high potential individuals should receive more education than otherwise identical individuals from groups with a more favourable distribution of these benefits.

Keywords: Reverse discrimination, Affirmative action, Education policy, Minorities

JEL Classification: I28, D63