The Impact of Affirmative Action Policies on Effort and Motivation: Evidence from Freelance Job Applications from India and the US

Abstract

Affirmative action policies – deliberate steps undertaken to tackle discrimination against groups along ethnic, racial and gender lines – have been used by over half the countries around the world. The contention over the efficacy of affirmative action stems from the fact that an increase in the representation of intended beneficiaries often comes at the cost of selection of non-beneficiaries. Through a unique field experiment involving job applications on Upwork, an online freelancing platform, this study captures the change in effort and motivation levels of 268 freelancers from India and the US as a result of the implementation of quota, weak (tie-breaking) preferential treatment and strong (reverse-discriminating) preferential treatment policies. The findings reveal region-specificity in the impact of affirmative action. Notably, while the results reveal a decrease in the effort exerted by the beneficiaries in both countries under all three policies, the overall direction of impact of the policies on the applicants’ motivation is positive for the American beneficiaries but negative for the Indian beneficiaries. This paper contributes to a better understanding of the behavioral costs and benefits associated with affirmative action policies, and thus has implications for public policy aimed at eliminating discrimination in areas such as education and employment.