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Will Affirmative-Action Policies Eliminate Negative Stereotypes?

Stephen Coate and Glenn C. Loury
The American Economic Review
Vol. 83, No. 5 (Dec., 1993), pp. 1220-1240
Stable URL: http://www.jstor.org/stable/2117558
Page Count: 21
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Will Affirmative-Action Policies Eliminate Negative Stereotypes?
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Abstract

A key question concerning affirmative action is whether the labor-market gains it brings to minorities can continue without it becoming a permanent fixture in the labor market. We argue that this depends on how the policy affects employers' beliefs about the productivity of minority workers. We study the joint determination of employer beliefs and worker productivity in a model of statistical discrimination in job assignments. We prove that, even when identifiable groups are equally endowed ex ante, affirmative action can bring about a situation in which employers (correctly) perceive the groups to be unequally productive, ex post.

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