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Racial Diversity and Aggregate Productivity in U.S. Industries: 1980–2000

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Author Info
Chad Sparber () (Department of Economics, Colgate University, 13 Oak Drive, Hamilton, NY 13346, USA)

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Abstract

This paper employs industry-level U.S. census data from 1980 to 2000 to assess the aggregate effects of racial diversity. While most international accounts find that diversity reduces productivity, I argue that the U.S. experience is more nuanced. Unqualified statements about the costs and merits of diversity are unwarranted, as racial heterogeneity increases productivity within many, but not all, industries. Sectors employing a large number of workers responsible for creative decision making and customer service experience gains from diversity, while industries characterized by high levels of group effort suffer losses. The results thus reconcile two competing literatures by suggesting that diversity improves decision making and problem solving but also encumbers common action and public goods provision.

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Publisher Info
Article provided by Southern Economic Association in its journal Southern Economic Journal.

Volume (Year): 75 (2009)
Issue (Month): 3 (January)
Pages: 829–856
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Handle: RePEc:sej:ancoec:v:75:3:y:2009:p:829-856

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Web page: http://www.southerneconomic.org/
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Find related papers by JEL classification:
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

Cited by:
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  1. Giovanni Peri & Chad Sparber, 2008. "Highly-Educated Immigrants and Native Occupational Choice," CReAM Discussion Paper Series 0813, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London. [Downloadable!]
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This page was last updated on 2009-12-3.

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