Government versus Private Affirmative Action

In an earlier post on affirmative action, I wrote the following:

The key point, moreover, is that government-imposed and privately-chosen affirmative action are different things.  The former restricts choices by private actors; the latter reflects choices by private actors.   This does not mean government-imposed is all bad and privately-chosen is all good. But the latter is likely to reflect a better balancing of costs and benefits.

A reader responded as follows:

Why? Because that's the dogma of your ideology? Please favor us non-gnostics with some basis in real information for this view.

A fair question.  Here is my response. I focus on hiriing decisions, but similar considerations would apply to setting like college admissions.

Affirmative action means that an employer takes race or sex into account in hiring decisions.  A private employer might do this for altruistic reasons.  Or a private employer might do this because it increases profits to have employees who "look like" the customers. Either way, a private employer will balance any benefits against the costs.  So, private affirmative action faces natural limitations.

Government-mandated affirmative action does not face these constraints.  Governments can and do impose it without regard to the costs it might impose.  The goal of hiring women and minorities becomes the sole objective without regard to whether the good achieved by this is worth the costs.  Government-mandated affirmative action tends to be one size fits all, imposing the same rules on large and small firms, on different parts of the country, on different industries, and so on.

So, is private affirmative action a good thing?  Presumably it is for firms that adopt it voluntarily. Is government-imposed affirmative action always bad? No; it probably forces some discriminating employers to hire more women and minorities.

But government-mandated affirmative action is polarizing because it forces hiring decisions based on race and sex.  It does this to employers who do not discriminate as well as to those that do.

Existing evidence on discrimation does not show it is non-existent.  But neither does it show this is the key determinant of wage or employment differentials across groups.  And private affirmative action addresses these differentials to some degree, without the polarizing effects.

That is why I oppose government-mandated but not private affirmative action.

Comments

[Mike Huben]

"Affirmative action means that an employer takes race or sex into account in hiring decisions."

No: that definition fits outright discrimination as well. A proper description is here.

"a private employer will balance any benefits against the costs"

Benefits and costs to himself only, by the sort of simplistic theory which ignores game-theoretic strategy. Discrimination was never economically efficient.

"Governments can and do impose it without regard to the costs it might impose."

OK: cite some costs. Explain how they're higher than the costs of discrimination.

"Government-mandated affirmative action tends to be one size fits all, imposing the same rules on large and small firms, on different parts of the country, on different industries, and so on."

Not according to the description I linked to.

"And private affirmative action addresses these differentials to some degree, without the polarizing effects."

Considering your definition includes the most blatant discrimination, I'd say that it does have polarizing effects.

[James]

Miron writes: "Affirmative action means that an employer takes race or sex into account in hiring decisions."

Huben claims "No: ..." (Ellipsis replaces irrelevant material. Whatever else JM's words might also describe in addition to A.A. doesn't say anything about whether or not those words actually describe A.A.)

From the site Huben links to: "Their goal -- that is, the percentage of minorities and women they are seeking to hire..."

Huben, do you read the stuff you link to?

Either A.A. means the employer takes race or sex into account when hiring, or it doesn't. How one earth could any employer actively seek to hire minorities and women and simultaneously not take sex and race into account?

[Mike Huben]

Well, James, it's about time you learned something about probability.

Assume for a moment that I'm hiring, and I flip a coin for each applicant. I'm bigoted about heads, and so I reject applicants who turn up heads.

Now assume I'm not bigoted. Without even looking at the flip results, I'll get 50% heads and 50% tails (for large enough sample sizes.)

I don't have to take the flip results into account. I may want to, if I suspect that the coin is biased, or to measure if my people doing the hiring are bigoted.

[James]

Mike,

I suspect your analogy fails on the grounds that according to that link you posted, A.A. involves seeking to do something. You didn't specify a goal to be sought in your analogy. We could discuss the merits of your analogy but I suspect any such discussion will be less than useful, so here's an idea: Answer the question I originally put to you.