Incentives to Identify: Racial Identity in the Age of Affirmative Action

We link data on racial self-identification with changes in state-level affirmative action policies to ask whether racial self-identification responds to economic incentives. We find that after a state bans affirmative action, multiracial individuals who face an incentive to identify under affirmative action are about 30 percent less likely to identify with their minority groups. In contrast, multiracial individuals who face a disincentive to identify under affirmative action are roughly 20 percent more likely to identify with their minority groups once affirmative action policies are banned.