Job Matching and Affirmative Action: The Impact of Transfer Policies

Cyril Rouault

Working Papers from HAL

Abstract: Subsidies and taxes are widely used in labor markets to influence employment outcomes. This paper uses a Kelso-Crawford framework to assess how transfers affect the welfare of minority workers. We show that affirmative action policies, though well-intentioned, can unintentionally harm this group. We establish that only uniform transfers—where all workers in a group receive the same subsidy or tax across all firms—guarantee no welfare loss. Building on this insight, we explore how transfers can be designed to achieve representation goals for minority workers without reducing their welfare.

Keywords: Job matching; Transfer policy; Market equilibrium; Subsidy; Taxation; Affirmative-Action; Salary (search for similar items in EconPapers)
Date: 2024-10-24
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