Affirmative Action: What Do We Know?

January 2006

Harry J. Holzer, Georgetown Public Policy Institute, Urban Institute; David Neumark, Public Policy Institute of California, University of California at Irvine, National Bureau of Economic Research, IZA–Institute for the Study of Labor

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In this paper we review the research evidence on the effects of Affirmative Action in employment, university admissions and government procurement. We consider effects on both equity (or distribution) as well as efficiency. Overall, we find that Affirmative Action does redistribute jobs, university admissions and government contracts away from white males towards minorities and females, though the overall magnitudes of these shifts are relatively modest. We also find that Affirmative Action shifts jobs and university admissions to minorities who have weaker credentials, but there is little solid evidence to date of weaker labor market performance among its beneficiaries. While those students admitted to universities under Affirmative Action have weaker grades and higher dropout rates than their white counterparts at selective schools, they benefit overall in terms of high graduation rates and salaries. Affirmative Action also generates positive externalities for the minority and low-income communities (in terms of better medical services and labor market contacts), and perhaps for employers and universities as well.

Educational Attainment, Employment, Unemployment, and the Labor Market, Race and Ethnicity