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Diversity and Social Capital Within the Workplace: Evidence from Britain

Listed author(s):
  • Thomas Breda
  • Alan Manning

This paper uses the British Workplace Employee Relations Survey to investigate the impact of gender and ethnic diversity on workers' level of trust in managers and the extent of identity with the values and objectives of the firm - dimensions of what we might call social capital within the workplace. These are both factors that one might expect to make firms more co-operative and, hence, productive. In contrast to much of the existing literature we pay particular attention to the estimation of causal effects, using an instrumental variable strategy. We find evidence that both women and minorities have higher levels of workplace trust and identity as individuals. But we also find evidence that a higher female share in the plant is associated with higher trust and identity (stronger for trust than identity) and that a higher minority share is associated lower trust and identity (stronger for identity than trust). However, in line with much of the literature, these results are not always significantly different from zero and they are sensitive to specification.

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File URL: http://cep.lse.ac.uk/pubs/download/dp1460.pdf
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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp1460.

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Date of creation: Dec 2016
Handle: RePEc:cep:cepdps:dp1460
Contact details of provider: Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP

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  1. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1251-1288.
  2. Marianne Bertrand & Sandra E. Black & Sissel Jensen & Adriana Lleras-Muney, 2014. "Breaking the Glass Ceiling? The Effect of Board Quotas on Female Labor Market Outcomes in Norway," NBER Working Papers 20256, National Bureau of Economic Research, Inc.
  3. Monica Langella & Alan Manning, 2016. "Diversity and Neighbourhood Satisfaction," CEP Discussion Papers dp1459, Centre for Economic Performance, LSE.
  4. David A. Matsa & Amalia R. Miller, 2013. "A Female Style in Corporate Leadership? Evidence from Quotas," American Economic Journal: Applied Economics, American Economic Association, vol. 5(3), pages 136-169, July.
  5. William Easterly & Ross Levine, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1203-1250.
  6. Alesina, Alberto & La Ferrara, Eliana, 2002. "Who trusts others?," Journal of Public Economics, Elsevier, vol. 85(2), pages 207-234, August.
  7. Sara Fisher Ellison & Wallace P. Mullin, 2014. "Diversity, Social Goods Provision, and Performance in the Firm," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(2), pages 465-481, June.
  8. Alberto Alesina & Reza Baqir & William Easterly, 1999. "Public Goods and Ethnic Divisions," The Quarterly Journal of Economics, Oxford University Press, vol. 114(4), pages 1243-1284.
  9. Sturgis, Patrick & Brunton-Smith, Ian & Read, Sanna & Allum, Nick, 2011. "Does Ethnic Diversity Erode Trust? Putnam’s ‘Hunkering Down’ Thesis Reconsidered," British Journal of Political Science, Cambridge University Press, vol. 41(01), pages 57-82, January.
  10. Gianmarco I.P. Ottaviano & Giovanni Peri, 2016. "The economic value of cultural diversity: evidence from US cities," World Scientific Book Chapters,in: The Economics of International Migration, chapter 7, pages 229-264 World Scientific Publishing Co. Pte. Ltd..
  11. Adams, Renée B. & Ferreira, Daniel, 2009. "Women in the boardroom and their impact on governance and performance," Journal of Financial Economics, Elsevier, vol. 94(2), pages 291-309, November.
  12. Kenneth R. Ahern & Amy K. Dittmar, 2012. "The Changing of the Boards: The Impact on Firm Valuation of Mandated Female Board Representation," The Quarterly Journal of Economics, Oxford University Press, vol. 127(1), pages 137-197.
  13. Yann Algan & Pierre Cahuc, 2010. "Inherited Trust and Growth," American Economic Review, American Economic Association, vol. 100(5), pages 2060-2092, December.
  14. Liz Twigg & Joanna Taylor & John Mohan, 2010. "Diversity or Disadvantage? Putnam, Goodhart, Ethnic Heterogeneity, and Collective Efficacy," Environment and Planning A, , vol. 42(6), pages 1421-1438, June.
  15. Natalia Letki, 2008. "Does Diversity Erode Social Cohesion? Social Capital and Race in British Neighbourhoods," Political Studies, Political Studies Association, vol. 56, pages 99-126, March.
  16. Alberto Alesina & Eliana La Ferrara, 2003. "Ethnic Diversity and Economic Performance," Harvard Institute of Economic Research Working Papers 2028, Harvard - Institute of Economic Research.
  17. Liz Twigg & Joanna Taylor & John Mohan, 2010. "Diversity or disadvantage? Putnam, Goodhart, ethnic heterogeneity, and collective efficacy," Environment and Planning A, Pion Ltd, London, vol. 42(6), pages 1421-1438, June.
  18. Marcus Noland & Tyler Moran & Barbara Kotschwar, 2016. "Is Gender Diversity Profitable? Evidence from a Global Survey," Working Paper Series WP16-3, Peterson Institute for International Economics.
  19. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-474, June.
  20. Andrea Tesei, 2014. "Trust, Racial Fragmentation and Income Inequality: New Evidence from the U.S," CESifo Working Paper Series 4718, CESifo Group Munich.
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