Policy and Practice Impacts

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Policy and Practice Impacts on Reservation System in India

Sanctioned by its constitution, India is home to the world’s most comprehensive affirmative action program, where historically oppressed groups are protected with vertical reservations implemented as “set asides,” and other disadvantaged groups are protected with horizontal reservations implemented as “minimum guarantees.”

In Sönmez and Yenmez (2022), we have shown that a mechanism mandated by the Supreme Court judgement  Anil Kumar Gupta v. State of U.P. (1995)–the SCI-AKG choice rule–suffers from important anomalies.  In the same paper we also documented that these anomalies triggered countless litigations in India for over two decades and disrupted recruitment processes throughout the country. The main difficulty has to do with the concurrent implementation of vertical and horizontal reservations, and a design flaw under the Supreme Court’s mechanism resulted in some individuals losing their horizontal protections upon claiming their vertical reservations.  This flaw of the Supreme Court’s mechanism regularly resulted in situations where higher merit ranking members of lower privilege groups lose their positions to lower merit ranking members of higher privilege groups, directly contradicting  the philosophy of affirmative action. It is this flaw–failure of no justified envy–which triggered countless litigations in India.  In Sönmez and Yenmez (2022), we have also formulated and proposed an alternative mechanism–the two-step minimum guarantee (2SMG) mechanism–to resolve the failure in the system.

Rescinding of the Flawed Mechanism along with an Endorsement of Our Proposed 2SMG Mechanism with a December 2020 Supreme Court Judgement

As our paper was under revision for the journal Econometrica, in its judgement Saurav Yadav v State of U.P. (2020)  using argument parallel to ours in our paper the Supreme Court of India has revoked the flawed SCI-AKG choice rule after its 25 years  of enforcement in the country. This important ruling also endorsed the 2SMG mechanism we earlier proposed as a resolution to the failure in the Supreme Court’s earlier mechanism. In addition, this important judgement also mandated any mechanism used in the country to satisfy the condition we formulated as the axiom of no justified envy

De Facto Enforcement of Our Proposed 2SMG Mechanism in India with Supreme Court’s December 2020 Judgement

Perhaps due to the large-scale crisis caused by its previous mechanism that was enforced in India for 25 years, in its December 2020  judgement Saurav Yadav v State of U.P. (2020) the justices have not explicitly enforced the 2SMG mechanism but merely endorsed it.  This “flexibility” offered by the Supreme Court is highly misleading, because the 2SMG mechanism is the only mechanism that satisfies the mandates imposed upon on the operation of the mechanism by the Supreme Court (including but not limited to the axiom of no justified envy). In other words, any mechanism other than the 2SMG mechanism is open to court challenge whenever it generates an outcome that differs from the outcome of the 2SMG mechanism.

Paper and Follow up Research

Additional details can be seen in  Sönmez and Yenmez (2022), and its Online Appendix documenting the relation between our analysis and major court rulings in India.

Here is a short promotional video of the paper.

Extended Analysis with Multiple Institutions

In Sönmez and Yenmez (2022), we studied the version of the problem where all positions are identical (typically) at a single institution. There is also a more complex version of the problem in India where a central planner allocates heterogenous positions (or university seats) across multiple institutions. For that version of the problem the axioms mandated in Saurav Yadav v State of U.P. (2020) and formulated in Sönmez and Yenmez (2022) do not single out a unique mechanism. However, either together with the Pareto principle or with the highly sought-after incentive-compatibility axiom of strategy-proofness they do.

Here is a follow-up extended analysis, and how it relates to additional litigations in India.