This paper examines public attitudes towards university admissions rules by focusing on the imposition of the costs of racial diversity across majority citizens. High-income majority citizens, who tend to have better academic qualifications, favour more diversity under affirmative action, which...

This Paper studies the optimal education policy in the presence of different groups of households, with groups differing in the distribution of the ability to benefit from education. The main result is that the high ability individuals from groups with relatively few high ability individuals...

This paper studies the aggregate economic effects of diversity policies such as affirmative action in college admission. If agents are constrained in the side payments they can make, the free market allocation displays excessive segregation relative to the first-best. Affirmative action policies...

We consider a search-matching model in which black workers are discriminated against and the job arrival rates of all workers depend on social networks as well as distance to jobs. Location choices are mainly driven by the racial preferences of households. There are two possible urban...

We study the evolution of racial educational inequality across US states from 1940 to 2000. We show that throughout this period, despite evidence of convergence, the racial gap in attainment between blacks and whites has been persistently determined by the initial gap. We obtain these results...

We exploit rules of class formation to identify the causal effect of increasing the number of immigrants in a classroom on natives test scores, keeping class size constant (Pure Composition Effect). We explain why this is a relevant policy parameter although it has been neglected so far. We show...

We study a model that integrates productive and socialization efforts with network choice and parental investments. We characterize the unique symmetric equilibrium of this game. We first show that individuals underinvest in productive and social effort, but that solving only the investment...

In late 2003, Norway passed a law mandating 40 percent of each gender on the board of publicly limited liability companies. The primary objective of this reform was to increase representation of women in top positions in the corporate sector and decrease gender disparity in earning within that...

We investigate whether acquiring more education when young has long-term effects on risk-taking behavior in financial markets and whether the effects spill over to spouses and children. There is substantial evidence that more educated people are more likely to invest in the stock market....

In this paper we examine the long term effects of socialization and segregation in schools, on labour market outcomes. We incorporate a model of “informational” peer influence by which beliefs of pupils are affected by exposure to other pupils’ posterior beliefs. Specifically, we focus on...