Diversity Preferences, Affirmative Action and Choice Rules

TL;DR

This paper analyzes how diversity preferences influence institutional choice rules, especially in affirmative action, and characterizes which rules can be justified by these preferences, highlighting limitations of certain policies.

Contribution

It provides a formal characterization of diversity-based choice rules and shows that some existing affirmative action mechanisms cannot be rationalized by diversity preferences.

Findings

Certain affirmative action policies are not consistent with diversity preferences.

Choice rules that satisfy the substitutes condition can be rationalized by separable diversity and match quality preferences.

Institutions evaluating diversity without intersectionality face limitations in their choice rules.

Abstract

I study the relationship between diversity preferences and the choice rules implemented by institutions, with a particular focus on the affirmative action policies. I characterize the choice rules that can be rationalized by diversity preferences and demonstrate that the recently rescinded affirmative action mechanism used to allocate government positions in India cannot be rationalized. I show that if institutions evaluate diversity without considering intersectionality of identities, their choices cannot satisfy the crucial substitutes condition. I characterize choice rules that satisfy the substitutes condition and are rationalizable by preferences that are separable in diversity and match quality domains.