Racial Inequality and Affirmative Action in Malaysia and South Africa

346 Pages·2014·1.61 MB·English

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Open Access Dissertations
9-2010
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Hwok-Aun Lee
University of Massachusetts Amherst
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RACIAL INEQUALITY AND AFFIRMATIVE ACTION IN

MALAYSIA AND SOUTH AFRICA

A Dissertation Presented

By

HWOK-AUN LEE

Submitted to the Graduate School of the
University of Massachusetts Amherst in partial fulfillment
of the requirements for the degree of

DOCTOR OF PHILOSOPHY

September 2010

Department of Economics
© Copyright by Hwok-Aun Lee 2010
All Rights Reserved
RACIAL INEQUALITY AND AFFIRMATIVE ACTION IN

MALAYSIA AND SOUTH AFRICA

A Dissertation Presented

By

HWOK-AUN LEE

Approved as to style and content by:

________________________________
Robert Pollin, Chair

________________________________
Gerald Epstein, Member

________________________________
James Heintz, Member

___________________________________
Gerald Epstein, Department Head
Department of Economics
DEDICATION

To Jacqui, whose love, grace and patience sustained this to fruition

To Kieran and Naomi, who inspired and distracted in perfect proportion

To my mother and the memory of my father, who first got me thinking
ACKNOWLEDGEMENTS

This dissertation was made possible by the guidance, support, and friendship of many
people and organizations. My dissertation committee directed the construction and
completion of this study out of a sprawling subject. I thank the chair, Bob Pollin, for his
critical comments, challenging questions, and encouragement, Jerry Epstein for
sharpening the focus and clarity of this study, and James Heintz for helpful and generous
feedback.
I am grateful to the Faculty of Economics and Administration, University of Malaya,
for granting me study leave to pursue this PhD, and to the Economic Planning Unit for
allowing access to Malaysian Household Income Survey data. Among the scholars of
Malaysia with whom I have interacted, I must single out Tey Nai Peng for his assistance
in obtaining the 2000 Census data, Khoo Khay Jin for his advice in handling the
household income surveys and Khoo Boo Teik for his insight and encouragement.
The PERI Dissertation Fellowship, PERI Travel Grant, and a short-term research
grant from the University of Malaya provided the means for doing fieldwork in South
Africa. I appreciate Seeraj Mohamed and the Corporate Strategy and Industrial
Development unit at the University of the Witwatersrand for letting me set up base on
their premises. I thank Seeraj, Ganief Bardien and Lumkile Mondi for their hospitality,
generosity, and conversations during my stay in Johannesburg. I am indebted to my hosts
in Cape Town, Michael and Nelleke Elston, for warmly and kindly opening their home.
I have been privileged to participate in graduate school with UMass economics
students and their families, especially Adam Hersh and Dawn Le, Mohammed Moeini
v
and Maryam Amjadi, Florian Kaufmann and Katrin Maurer, Phil Mellizo, Noah Enelow,
Ben Zipperer, Heidi Peltier, Hasan Comert, Martin Rapetti, and EGSO. The Graduate
International Christian Fellowship, Michael and Carol Greene, our First Baptist Church
growth group, and North Village neighbors, have been sources of friendship and
community.
Above all, my deepest gratitude flows to Jacqui, Kieran and Naomi, for being a home
I always look forward to return to, and for reminding me to be present and relevant.
I praise and thank God for the gifts of living, striving, and learning.

vi
ABSTRACT

RACIAL INEQUALITY AND AFFIRMATIVE ACTION

IN MALAYSIA AND SOUTH AFRICA

SEPTEMBER 2010

HWOK-AUN LEE, B.A., UNIVERSITY OF BRITISH COLUMBIA

M.SC., SCHOOL OF ORIENTAL AND AFRICAN STUDIES

PH.D., UNIVERSITY OF MASSACHUSETTS AMHERST

Directed by: Professor Robert Pollin

This dissertation examines racial inequality and affirmative action in Malaysia and
South Africa, two countries with a politically dominant but economically
disadvantaged majority group – the Bumiputera in Malaysia, and blacks in post-
Apartheid South Africa. We aim to contribute comparative perspectives and current
empirical research on affirmative action regimes and dimensions of inequality directly
pertinent to affirmative action, chiefly, racial representation and earnings inequality
among tertiary educated workers and in upper-level occupations. We discuss
theoretical approaches to inequality and affirmative action, with attention to particular
circumstances of majority-favoring regimes, then survey, compare and contrast
affirmative action programs and their political economic context in Malaysia and South
Africa. In the empirical portions, we outline patterns and evaluate determinants of
racial inequality, focusing on the mid-1990s to the mid-2000s.
vii
On Malaysia, we find that Bumiputera access to tertiary education has rapidly
increased, but also observe disproportionate difficulties among Bumiputera degree-
holders in participating in labor markets and in attaining upper-level occupations.
Bumiputera representation at managerial and professional levels has remained static
and dependent on the public sector. Econometric results indicate that quality of tertiary
education impacts on the prospect of attaining upper-level jobs, and that Bumiputera
are more adversely affected. Lack of data restricts our assessment of racial earnings
inequality to a deduction that Bumiputera young graduates have experienced relatively
greater decline in their earnings capacity.
On South Africa, we find that blacks have steadily increased access to tertiary
education, although disparities in quality of institutions and in student performance
persist, which disproportionately and negatively affect black graduates. We observe
that black representation has increased in upper-level, especially professional,
occupations, largely in the public sector. We find that white-black earnings disparity
declined substantially among degree-qualified workers, while not diminishing or not
showing clear patterns among other educational and occupational groups.
We conclude by considering, within the constraints of each country’s political
economic context, implications that arise from our findings. Most saliently, while
affirmative action raises quantitative attainment of tertiary education and
representation in upper-level occupations for the beneficiary group, inadequate
attention to qualitative development of institutions and progressive distribution of
benefits may attenuate progress toward the ultimate objective of cultivating broad-
based, self-reliant professionals and managers.
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TABLE OF CONTENTS

ACKNOWLEDGEMENTS ................................................................................................ v

ABSTRACT ...................................................................................................................... vii

LIST OF TABLES ........................................................................................................... xiv

LIST OF TABLES ........................................................................................................... xiv

LIST OF FIGURES .......................................................................................................... xvi

LIST OF ABBREVIATIONS AND TERMS ................................................................... xx

CHAPTER

1. INTRODUCTION ........................................................................................................... 1

1. 1. Motivation and main tasks ...................................................................................... 1
1. 2. Structure of chapters ................................................................................................ 4

2. INEQUALITY AND AFFIRMATIVE ACTION: CONCEPT, POLICY AND
COUNTRY CONTEXT ................................................................................................ 10

2. 1. Inequality, disadvantage and affirmative action: Conceptual and policy issues ... 10

2. 1. 1. Inequality and systemic disadvantage ........................................................... 10
2. 1. 2. Conceptions of affirmative action ................................................................. 16
2. 1. 3. Contentious issues and alternatives to race-based affirmative action ........... 21

2. 1. 3. 1. Market mechanisms versus state intervention ....................................... 22
2. 1. 3. 2. Race-based affirmative action ............................................................... 24
2. 1. 3. 3. Merit and effort, efficiency and dependency ......................................... 32
2. 1. 3. 4. Overall assessment ................................................................................. 37

2. 1. 4. Empirical approaches to affirmative action .................................................. 41

2. 2. Imperative, content and context of affirmative action: Malaysia .......................... 43

2. 2. 1. Systemic disadvantage and affirmative action imperatives .......................... 43
2. 2. 2. Affirmative action policies and programs ..................................................... 50

2. 2. 2. 1. Representation in education ................................................................... 51
2. 2. 2. 2. Representation in upper-level occupations ............................................ 56
2. 2. 2. 3. Equity and property ownership .............................................................. 59
2. 2. 2. 4. Managerial and enterprise development ................................................ 60
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