Affirmative Action through Quotas: The Effect on Learning In India

Countries characterized by significant learning inequalities across racial and ethnic groups frequently address them through a quota system in higher education. Using data from India, this paper estimates the effect of quotas on learning, quantifying their cost by comparing outcomes to those obtained under alternative admission rules. It does so by assessing how learning is affected by the mean and variance of classroom ability. I use control functions to eliminate selection bias, identifying them through a novel strategy which exploits the fact that students choose programs based on the partial information available at enrollment, information that determines enrollment but not learning conditional on enrollment.