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Faculty of Economics

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Amano-Patiño, N., Aramburu, J., Contractor, Z.

Is Affirmative Action in Employment Still Effective in the 21st Century?


Abstract: We study Executive Order 11246, an employment-based affirmative action policy targeted at firms holding contracts with the federal government. We find this policy to be ineffective in the 21st century, contrary to the positive effects found in the late 1900s (Miller, 2017). Our novel dataset combines data on federal contract acquisition and enforcement with US linked employer-employee Census data 2000–2014. We employ an event study around firms’ acquiring a contract, based on Miller (2017), and find the policy had no effect on employment shares or on hiring, for any minority group. Next, we isolate the impact of the affirmative action plan, which is EO 11246’s preeminent requirement that applies to firms with contracts over $50,000. Leveraging variation from this threshold in an event study and regression discontinuity design, we find similarly null effects. Last, we show that even randomized audits are not effective, suggesting weak enforcement. Our results highlight the importance of the recent budget increase for the enforcement agency, as well as recent policies enacted to improve compliance.

Keywords: Racial discrimination, affirmative action regulation, unemployment, earnings differentials

JEL Codes: J15 J23 J31 J71 J78 K31

Author links: Noriko Amano-Patiño  


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