Working Paper: NBER ID: w13926
Authors: Marianne Bertrand; Rema Hanna; Sendhil Mullainathan
Abstract: Many countries mandate affirmative action in university admissions for traditionally disadvantaged groups. Little is known about either the efficacy or costs of these programs. This paper examines affirmative action in engineering colleges in India for "lower-caste" groups. We find that it successfully targets the financially disadvantaged: the marginal upper-caste applicant comes from a more advantaged background than the marginal lower-caste applicant who displaces him. Despite much lower entrance exam scores, the marginal lower-caste entrant does benefit: we find a strong, positive economic return to admission. These findings contradict common arguments against affirmative action: that it is only relevant for richer lower-caste members, or that those who are admitted are too unprepared to benefit from the education. However, these benefits come at a cost. Our point estimates suggest that the marginal upper-caste entrant enjoys nearly twice the earnings level gain as the marginal lower-caste entrant. This finding illustrates the program's redistributive nature: it benefits the poor, but costs resources in absolute terms. One reason for this lower level gain is that a smaller fraction of lower-caste admits end up employed in engineering or advanced technical jobs. Finally, we find no evidence that the marginal upper-caste applicant who is rejected due to the policy ends up with more negative attitudes towards lower castes or towards affirmative action programs. On the other hand, there is some weak evidence that the marginal lower-caste admits become stronger supporters of affirmative action programs.
Keywords: affirmative action; education; engineering college admissions; India; socioeconomic outcomes
JEL Codes: I21; I38; J7
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Displaced upper-caste applicants (J15) | Lower parental income compared to displacing lower-caste applicants (I24) |
| Admission of marginal upper-caste entrants (I24) | Nearly double the economic gain compared to lower-caste counterparts (O57) |
| Lower-caste students admitted through affirmative action (I24) | No worse academic performance (D29) |
| Costs of affirmative action (J78) | Smaller fraction of lower-caste admits secure employment in engineering roles (J82) |
| Rejected upper-caste applicants (J15) | No significant negative shift in attitudes towards lower castes (J15) |
| Lower-caste admits (J15) | Increased support for affirmative action programs (J68) |
| Affirmative action policies (J78) | Targeting economically disadvantaged individuals among lower-caste groups (I32) |
| Admission of marginal lower-caste entrants (I24) | Increase in monthly income (E25) |