About Nick: i am an economist based in malaysia. I write about development economics, while sneaking in a pop culture reference or two.

Meritocracy and Inequality: The Role of Affirmative Action

Published in The Edge Malaysia, September 2018.

Last month, I wrote an article titled “The Merits and De-Merits of Meritocracy” which argued that meritocracy, in its current state, worsens inequality over time. The logic is as follows. If there is a strong correlation between parental income and children outcomes such as academic performance, internship attainment, strong social networks, healthier personal lifestyles, education levels and so on, then this concept of ‘meritocracy’ is something that can be – in large part – inherited, rather than earned over generations.

To be clear, I am not just speaking of the Crazy Rich, the top 0.1% of people. The meritocracy of the past few decades has created a new class which American philosopher Matthew Stewart calls, the top 9.9%, who he describes as, “We’re a well-behaved, flannel-suited crowd of lawyers, doctors, dentists, mid-level investment bankers, M.B.A.s with opaque job titles, and assorted other professionals.”

The point is therefore captured as follows – should our opportunities in life be determined by the circumstances of our birth, also known as the birth lottery? After all, no one chooses whether they were born a Crazy Rich Asian, or a Not-So-Crazy Middle-Income American, or a Poor European, and so on. As Elon Musk once, perhaps apocryphally, replied to a Tweet by the MIT Technology Review that said, “Ready for a world in which a $50 DNA test can predict your odds of earning a PhD or forecast which toddler gets into a selective preschool?” – “You can do this already with a ZIP Code.”

With that said, meritocracy matters. To be clear, I am not advocating for an end to meritocracy. It is useful, optimal even, in certain circumstances. Neither do I believe that the socialist solution of equality of outcomes for all is the way to go – that has proven to be a disaster when it has been tried. Rather, my suggestion for the way forward in terms of resource allocation is towards a tempered meritocracy or, in other words, meritocracy but with strong affirmative action.

Affirmative action sometimes gets a bad reputation, whether in Malaysia or in developed nations such as the United States. The argument against affirmative action is typically put forward as follows – There should be no favouritism in resource allocation – just as we shouldn’t favour the privileged group, we should also not favour the less privileged group.

This stylised argument is naïve; different groups have different present and historical circumstances. Yes, the execution of affirmative action may be flawed in that it operates at a group level rather than at an individual level. Whether the groups are White Americans or Black Americans, or Bumiputra and non-Bumiputra, what affirmative action is trying to do is to give a leg up towards those who have been underprivileged historically; there is no denying that in attempting to do so, it has richly benefited some individuals who did not need that leg up but just happened to belong in the underprivileged group while failing to benefit some individuals who needed that leg up but just happened to belong in the privileged group. The execution of affirmative action is therefore vulnerable to any other means-tested targeting programmes and must be refined as much as is practically possible and morally justifiable.

Therefore, in attempting to properly balance meritocracy with affirmative action to reduce inter-generational inequality, there are two concrete areas that we may consider. The first is on public scholarships. The idea is to broaden the scholarship net to capture more poor students. To this end, it may be worth considering scholarships that allow for lower – but still strong (meritocracy is still important) – achievement thresholds for the lower-income groups. It is, after all, more challenging for a poor student to achieve, say, 7As for SPM, than it is for a rich student. Why not take that into account? We therefore allocate resources based on input costs as well, not just the output.

At a more extreme level, we could even reserve undergraduate scholarships only for low-income students, thereby opening the meritocracy gates to more low-income households. However, at the PhD level – where students are researching potentially world-changing things such as a cure for cancer, or infinite clean energy resources – we can let pure meritocracy determine who receives scholarships.

The next concrete step is in the area of public education. One way to smoothen out meritocracy over generations is to also implement affirmative action for school funding. For public schools in more affluent neighbourhoods, cut the funding and redistribute that funding to public schools in low-income neighbourhoods, especially to those that manage to outperform their peer schools. This would send the message that performance still matters for low-income neighbourhood public schools, but these schools would be supported above and beyond those that happen to be in more affluent areas.

Another way to act via public schools is to create a new model of school for low-income neighbourhoods. Lebron James, the best basketball player in the world, has started a school in his hometown of Akron, Ohio, called the “I Promise” School, which caters to approximately 250 at-risk students in Akron. The school, a joint venture between James’ foundation and Akron Public Schools, is designed to help at-risk kids who are lagging behind in their studies and struggling at home, but with a twist. There is a strong focus as well on combating factors outside the classroom that cause children to struggle.

As the principal Brandi Davis puts it, “I think the missing link in public education is that family wraparound support. Because our students come to school and they’re worried about things at home…We want to create that safe, that secure and that caring and loving environment for our families and our students so that our kids can focus on education.” Accordingly, the school provides free transportation within 2 miles of the school, free breakfast, lunch and snacks for the students, a food pantry for families who can’t afford food, as well as high school diploma qualifications and job placement services for parents. To escape dangerous neighbourhoods, all students also receive a free bicycle and helmet. The idea is therefore a revolutionary one – to create a school that caters not just to improving in-school outcomes for students, but also to out-of-school outcomes for their families as well, thereby recognising the systemic issue of poverty.

Solutions to maintain a strong sense of merit to resource allocation while also ensuring that meritocracy is more inclusive, especially to lower-income households, are there, just waiting to be found and implemented. The risk, should we fail to acknowledge the need for strong affirmative action, of carrying on with meritocracy as so-conceived presently, is ever-increasing inequality over generations. Walter Scheidel, an Austrian historian at Stanford, argues that historically, inequality never dies peacefully and declines substantially only via warfare, revolutions, state collapse and plagues. Can we reverse the trend of history or are we doomed to repeat it?

What Does it Really Mean to be a Competitive Nation?

The Merits and De-Merits of Meritocracy