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Cultural diversity and plant-level productivity

Listed author(s):
  • Trax, Michaela
  • Brunow, Stephan
  • Suedekum, Jens

Using comprehensive data for German establishments, we estimate plant-level production functions to analyze if “cultural diversity” affects total factor productivity. We distinguish diversity in the establishment's workforce (the micro level) and in the aggregate labor force of the region where the plant is located (the macro level). We find that a larger share of foreign workers — either in the establishment or in the region — does not affect productivity. However, there are spillovers associated with the degree of fractionalization of the group of foreigners into different nationalities. Regional diversity is at least as important for productivity as micro-level diversity.

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File URL: http://www.sciencedirect.com/science/article/pii/S0166046215000459
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Article provided by Elsevier in its journal Regional Science and Urban Economics.

Volume (Year): 53 (2015)
Issue (Month): C ()
Pages: 85-96

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Handle: RePEc:eee:regeco:v:53:y:2015:i:c:p:85-96
DOI: 10.1016/j.regsciurbeco.2015.05.004
Contact details of provider: Web page: http://www.elsevier.com/locate/regec

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