How Costly Is Affirmative Action? Government Contracting and California's Proposition 209
Justin Marion ()
The Review of Economics and Statistics, 2009, vol. 91, issue 3, 503-522
This paper investigates the effect of disadvantaged business enterprise subcontractor goals on the winning bids for highway construction contracts using California's Proposition 209, which prohibited the consideration of race or gender in awarding state-funded contracts. After Proposition 209, prices on state-funded contracts fell by 5.6% relative to federally funded projects, for which preferences still applied. Most of the price decline after Proposition 209 resulted from the mix of subcontractors employed, which seems to arise from the higher costs of firms located in high-minority areas. Finally, short-run barriers to entry and expansion may increase the cost of affirmative action. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.
References: Add references at CitEc
Citations View citations in EconPapers (25) Track citations by RSS feed
Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/rest.91.3.503 link to full text (application/pdf)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:tpr:restat:v:91:y:2009:i:3:p:503-522
Ordering information: This journal article can be ordered from
http://mitpress.mit. ... me.tcl?issn=00346535
Access Statistics for this article
The Review of Economics and Statistics is currently edited by Daron Acemoglu, George J. Borjas, Dani Rodrik and Julio J. Rotemberg
More articles in The Review of Economics and Statistics from MIT Press
Series data maintained by Kristin Waites ().