Affirmative Action and Human Capital Investment: Evidence from a Randomized Field Experiment

We conduct a field experiment paying students according to relative performance on a mathematics exam and tracking study efforts on a mathematics website to test the incentive effects of affirmative action (AA) policies on study effort and math proficiency. AA increases study effort and exam performance for the majority of disadvantaged students targeted by the policy. While the performance of the highest-ability students targeted by the AA policy declines, on average study activity and exam performance rise under AA. Overall, the experimental evidence suggests that AA can promote greater equality of market outcomes while narrowing achievement gaps.