By: LEONA LAI

There has been a significant decline nationally in the level of Affirmative Action used by selective public colleges. Yeujun, PHBS Assistant Professor provides an innovative approach to this issue in his research published by Marketing Letters. CENET have interviewed Yeujun just before PHBS 10 Year Anniversary, and he shares insight into business school admission. 

“Affirmative Action” in college admissions involves preferential selection based on gender, race or ethnicity, and generates a lot of debate. Critics argue that preferential treatment of women and African-Americans is reverse discrimination, which violates the right of men and whites. According to recent research conducted by the American Educational Research Association, there has been a significant decline nationally in the level of Affirmative Action used by selective public colleges from 1992 to 2004, which is attributable to institutions in the eight states affected by statewide affirmative action bans or Circuit Court rulings during the period.¹

In contrast, justifications behind Affirmative Action are the educational benefits of diversity, including cross-racial understanding and dialogue, the reduction of racial isolation and the breaking down of racial stereotypes, just like the guidance released by the U.S. Departments of Education and Justice last year, which supports universities in pursuing that interest in their admissions programs if they do so in lawful ways.²
 
However there is a marketing side approach to this issue according to a study by Yeujun et al. who is PHBS Assistant Professor in Management (Marketing). The main theme of the research is that an MBA program can be viewed as a brand community and that student acquisition may be driven by the demographics of members of the community.

Yeujun and his co-authors, Michael Lewis from Emory University and Debanjan Mitra from the University of Florida, presented their findings in a paper titled, “Customer portfolio composition and customer equity feedback effects: Student diversity and acquisition in educational communities,” published by Marketing Letters.  

Using a longitudinal analysis of data collected from Business Week MBA rankings from 1990 to 2008, they find that a higher proportion of female students leads to significant increases in future applications. This implies a marketing rationale for business schools in encouraging gender diversity. “Although now female-male ratio is good in most universities, in the MBA program there is a big difference between female and male. Because MBA programs only admit students with work experience, and women may quit a job once they get married and have babies. So that’s why I use a female index” said Yeujun.

It’s easy to understand why increases in the size of a school’s female student segment positively impact overall applications. There is evidence that individuals find it easier to form connections with members of their own identity groups. “If you have a large proportion of female students, most females prefer to come because they feel more comfortable with females. Maybe guys like it, but I don’t know,” explained Yeujun.

But for the international and minority student segment, the paper finds an opposite effect, which is a negative change in application demand in response to increases in these two segments. These results serve as empirical evidence of prejudice towards minority and international students among business school applicants. “There is some stereotype, because they think if there are many international students the school has some bias or their school program quality will be lower. Especially minorities like Hispanics and African-Americans. If there are many minority students they won’t come” said Yeujun.

Their findings provide a unique glimpse into the current state of social prejudice as they provide evidence about the educational choices of the general population. Since social prejudice is often latent, subtle, and almost never self-reported, it cannot be observed directly but only deduced. This evidence, in some ways, is cleaner than that of wage differences since applicants, unlike employers, would be unaware of the abilities and motivation of existing students. Affirmative Action is usually justified by the existence of social prejudice, so their empirical analyses may be considered as an innovative large-scale test of a key justification behind Affirmative Action.

“Our approach is kind of a marketing side approach, so it’s very different from the educational approach. That’s why the publishers like our idea. Because everyone thinks about the diversity benefits only when they talk about whether we should give more favor to the minority or female. So we call on the Affirmative Policy,” said Yeujun. “But actually there is a different perspective. This is a kind of pattern we can find. It’s not about the diversity benefits; it’s about just attracting people with similar characteristics or some stereotype issues.”

The authors also explicitly comment on the limitations of their analysis and call for future research on some key issues, such as unconsidered demographic trends. As the population of prospective MBA students becomes increasingly diverse, MBA programs’ efforts to increase levels of non-traditional segments may yield future benefits. It has been noted that the percentage of female students at the top MBA schools has leveled off despite efforts to attract female students. Due to limitations on H-1B visas³  and improved universities in Asia and Europe, continued growth of the international segment may also be difficult to achieve.

However, in contrast to female and foreign applicants, minority students may be a future growth segment. While the percentage of MBA degrees awarded to minorities grew from about 6% of all degrees in 1987 to more than 11% in 2001, this population is underrepresented relative to overall population levels. Thus, demographic trends suggest minority communities are likely to be an increasingly important source of students for graduate business programs in the US.⁴ 

Yet, because of the evidence supporting the existence of social prejudice that causes a decrease in applications as a consequence of an increase in minority students, the study’s authors call for a continuance of Affirmative Action policies for these segments. The paper concludes that even in the absence of such policies, increasing minority diversity may represent an investment in the future, given the growth potential of the minority segment.

Reference:
1. G. H. Blume, M. C. Long. Changes in Levels of Affirmative Action in College Admissions in Response to Statewide Bans and Judicial Rulings. Educational Evaluation and Policy Analysis, 2013; DOI: 10.3102/0162373713508810
2. New Guidance Supports Voluntary Use of Race to Achieve Diversity in Higher Education  SEPTEMBER 27, 2013 http://www.ed.gov/news/press-releases/new-guidance-supports-voluntary-use-race-achieve-diversity-higher-education
3. The H-1B is a non-immigrant visa in the United States. It allows U.S. employers to temporarily employ foreign workers in specialty occupations. 
4. New York Times, The (2012). To enroll more minority students, colleges work around the courts. By Richard Perez-Pena, April 1.