IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Cultural Diversity and Plant‐Level Productivity

  • Trax, Michaela

    ()

    (University of Duisburg-Essen)

  • Brunow, Stephan

    ()

    (Institute for Employment Research (IAB), Nuremberg)

  • Suedekum, Jens

    ()

    (Heinrich Heine University Düsseldorf)

Using comprehensive data for German establishments (1999-2008), we estimate plant-level production functions to analyze if “cultural diversity” affects total factor productivity. We distinguish diversity in the establishment's workforce and in the aggregate regional labor force where the plant is located. We find that a larger share of foreign workers – either in the establishment or in the region – does not affect productivity. However, there are strong spillovers associated with the degree of cultural heterogeneity. The aggregate level is, quantitatively, at least as important as the workforce composition inside the establishment. Diversity thus seems to induce externalities beyond the boundaries of a single firm; it improves local business environments.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://ftp.iza.org/dp6845.pdf
Download Restriction: no

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6845.

as
in new window

Length: 43 pages
Date of creation: Sep 2012
Date of revision:
Publication status: published in: Regional Science and Urban Economics, 2015, 53, 85-96 [Final version]
Handle: RePEc:iza:izadps:dp6845
Contact details of provider: Postal:
IZA, P.O. Box 7240, D-53072 Bonn, Germany

Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information: Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:


References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
  2. Berliant, Marcus & Fujita, Masahisa, 2004. "Knowledge Creation as a Square Dance on the Hilbert Cube," IDE Discussion Papers 14, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  3. Francesco D'Amuri & Giovanni Peri, 2012. "Immigration, jobs and employment protection: evidence from Europe before and during the Great Recession," Temi di discussione (Economic working papers) 886, Bank of Italy, Economic Research and International Relations Area.
  4. Walter Bossert & Conchita D'Ambrosio & Eliana La Ferrara, 2011. "A Generalized Index of Fractionalization," Economica, London School of Economics and Political Science, vol. 78(312), pages 723-750, October.
  5. David Roodman, 2007. "A Note on the Theme of Too Many Instruments," Working Papers 125, Center for Global Development.
  6. Edward L. Glaeser & Jed Kolko & Albert Saiz, 2000. "Consumer City," Harvard Institute of Economic Research Working Papers 1901, Harvard - Institute of Economic Research.
  7. Sander Hoogendoorn & Mirjam van Praag, 2012. "Ethnic Diversity and Team Performance: A Field Experiment," Tinbergen Institute Discussion Papers 12-068/3, Tinbergen Institute, revised 01 May 2014.
  8. GianMarco Ottaviano & Giovanni Peri, 2004. "The Economic Value of Cultural Diversity: Evidence from US cities," Econometric Society 2004 North American Summer Meetings 91, Econometric Society.
  9. Steve Bond, 2002. "Dynamic panel data models: a guide to microdata methods and practice," CeMMAP working papers CWP09/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  10. Lazear, Edward P, 1999. "Globalisation and the Market for Team-Mates," Economic Journal, Royal Economic Society, vol. 109(454), pages C15-40, March.
  11. James E. Rauch, 1996. "Networks versus Markets in International Trade," NBER Working Papers 5617, National Bureau of Economic Research, Inc.
  12. Spolaore, Enrico & Wacziarg, Romain, 2006. "The Diffusion of Development," CEPR Discussion Papers 5630, C.E.P.R. Discussion Papers.
  13. Parrotta, Pierpaolo & Pozzoli, Dario & Pytlikova, Mariola, 2012. "Does Labor Diversity Affect Firm Productivity?," IZA Discussion Papers 6973, Institute for the Study of Labor (IZA).
  14. Edward L. Glaeser & Giacomo A. M. Ponzetto & Kristina Tobio, 2014. "Cities, Skills and Regional Change," Regional Studies, Taylor & Francis Journals, vol. 48(1), pages 7-43, January.
  15. George S Olley & Ariel Pakes, 1992. "The Dynamics Of Productivity In The Telecommunications Equipment Industry," Working Papers 92-2, Center for Economic Studies, U.S. Census Bureau.
  16. Suedekum, Jens & Wolf, Katja & Blien, Uwe, 2009. "Cultural Diversity and Local Labour Markets," IZA Discussion Papers 4619, Institute for the Study of Labor (IZA).
  17. 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, 06.
  18. Klette, T.J., 1992. "The Inconsistency of Common Scale Estimators when Output Prices are unobserved and Endogenous," Harvard Institute of Economic Research Working Papers 1586, Harvard - Institute of Economic Research.
  19. Johannes Van Biesebroeck, 2004. "Robustness of Productivity Estimates," NBER Working Papers 10303, National Bureau of Economic Research, Inc.
  20. Vernon Henderson, 2001. "Marshall's Scale Economies," Working Papers 01-17, Center for Economic Studies, U.S. Census Bureau.
  21. Giovanni Peri & Chad Sparber, 2009. "Task Specialization, Immigration and Wages," Working Papers 91, University of California, Davis, Department of Economics.
  22. Ottaviano, Gianmarco I.P. & Peri, Giovanni, 2005. "Cities and cultures," Journal of Urban Economics, Elsevier, vol. 58(2), pages 304-337, September.
  23. Chad Sparber, 2009. "Racial Diversity and Aggregate Productivity in U.S. Industries: 1980–2000," Southern Economic Journal, Southern Economic Association, vol. 75(3), pages 829–856, January.
  24. Bauernschuster, Stefan & Falck, Oliver & Heblich, Stephan & Suedekum, Jens, 2012. "Why Are Educated and Risk-Loving Persons More Mobile Across Regions?," IZA Discussion Papers 6860, Institute for the Study of Labor (IZA).
  25. Blundell, R. & Bond, S., 1995. "Initial Conditions and Moment Restrictions in Dynamic Panel Data Models," Economics Papers 104, Economics Group, Nuffield College, University of Oxford.
  26. Hethey, Tanja & Schmieder, Johannes F., 2010. "Using worker flows in the analysis of establishment turnover : evidence from German administrative data," FDZ Methodenreport 201006_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  27. 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.
  28. Barton H. Hamilton & Jack A. Nickerson & Hideo Owan, 2003. "Team Incentives and Worker Heterogeneity: An Empirical Analysis of the Impact of Teams on Productivity and Participation," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 465-497, June.
  29. Wagner, Joachim, 2005. "Exports and Productivity : A survey of the evidence from firm level data," HWWA Discussion Papers 319, Hamburg Institute of International Economics (HWWA).
  30. Berliant, Marcus & Fujita, Masahisa, 2012. "Culture and diversity in knowledge creation," Regional Science and Urban Economics, Elsevier, vol. 42(4), pages 648-662.
  31. Ozgen, Ceren & Nijkamp, Peter & Poot, Jacques, 2011. "The Impact of Cultural Diversity on Innovation: Evidence from Dutch Firm-Level Data," IZA Discussion Papers 6000, Institute for the Study of Labor (IZA).
  32. L H Kahane & N Longley & R Simmons, 2009. "The Effects of Coworker Heterogeneity on Firm-Level Output: Assessing the Impacts of Cultural and Language Diversity in the National Hockey League," Working Papers 599378, Lancaster University Management School, Economics Department.
  33. Alesina, Alberto & Harnoss, Johann & Rapoport, Hillel, 2013. "Birthplace Diversity and Economic Prosperity," IZA Discussion Papers 7568, Institute for the Study of Labor (IZA).
  34. Giovanni Peri & Francisco Requena, 2009. "The Trade Creation Effect of Immigrants: Evidence from the Remarkable Case of Spain," NBER Working Papers 15625, National Bureau of Economic Research, Inc.
  35. Gnanaraj Chellaraj & Keith E. Maskus & Aaditya Mattoo, 2008. "The Contribution of International Graduate Students to US Innovation," Review of International Economics, Wiley Blackwell, vol. 16(3), pages 444-462, 08.
  36. Annekatrin Niebuhr, 2010. "Migration and innovation: Does cultural diversity matter for regional R&D activity?," Papers in Regional Science, Wiley Blackwell, vol. 89(3), pages 563-585, 08.
  37. Sparber, Chad, 2007. "Racial Diversity and Macroeconomic Productivity across US States and Cities," Working Papers 2007-01, Department of Economics, Colgate University.
  38. Ortega, Francesc & Peri, Giovanni, 2014. "Openness and income: The roles of trade and migration," Journal of International Economics, Elsevier, vol. 92(2), pages 231-251.
  39. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-26, November.
  40. James E. Rauch & Vitor Trindade, 2002. "Ethnic Chinese Networks In International Trade," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 116-130, February.
  41. Mayr, Karin & Böheim, Rene & Horvath, Thomas, 2013. "Birthplace diversity of the workforce and productivity spill-overs in firms," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79890, Verein für Socialpolitik / German Economic Association.
  42. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," Review of Economic Studies, Oxford University Press, vol. 70(2), pages 317-341.
  43. Francesco D'Amuri & Giovanni Peri, 2010. "Immigration and Occupations in Europe," CReAM Discussion Paper Series 1026, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  44. Conyon, Martin J, et al, 2002. "The Productivity and Wage Effects of Foreign Acquisition in the United Kingdom," Journal of Industrial Economics, Wiley Blackwell, vol. 50(1), pages 85-102, March.
  45. Ackerberg, Daniel & Caves, Kevin & Frazer, Garth, 2006. "Structural identification of production functions," MPRA Paper 38349, University Library of Munich, Germany.
  46. Gerdes, Christer, 2010. "Using "Shares" vs. "Log of Shares" in Fixed-Effect Estimations," IZA Discussion Papers 5171, Institute for the Study of Labor (IZA).
  47. Rosenthal, Stuart S. & Strange, William C., 2004. "Evidence on the nature and sources of agglomeration economies," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 49, pages 2119-2171 Elsevier.
  48. Enrico Moretti, 2004. "Workers' Education, Spillovers, and Productivity: Evidence from Plant-Level Production Functions," American Economic Review, American Economic Association, vol. 94(3), pages 656-690, June.
  49. Ilke Van Beveren, 2007. "Total factor productivity estimation: A practical review," LICOS Discussion Papers 18207, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  50. Bartel, Ann P, 1989. "Where Do the New U.S. Immigrants Live?," Journal of Labor Economics, University of Chicago Press, vol. 7(4), pages 371-91, October.
  51. David Card, 2004. "Is the New Immigration Really So Bad?," CReAM Discussion Paper Series 0402, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  52. David Audretsch & Dirk Dohse & Annekatrin Niebuhr, 2010. "Cultural diversity and entrepreneurship: a regional analysis for Germany," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(1), pages 55-85, August.
  53. Antonio Ciccone & Robert E. Hall, 1995. "Productivity and the density of economic activity," Economics Working Papers 120, Department of Economics and Business, Universitat Pompeu Fabra.
  54. David Roodman, 2006. "How to Do xtabond2: An Introduction to "Difference" and "System" GMM in Stata," Working Papers 103, Center for Global Development.
  55. Ceren Ozgen, 2011. "The Impact of Cultural Diversity on Innovation: Evidence from Dutch Firm-Level Data," Norface Discussion Paper Series 2011013, Norface Research Programme on Migration, Department of Economics, University College London.
  56. Alesina, Alberto & La Ferrara, Eliana, 2005. "Ethnic Diversity and Economic Performance," Scholarly Articles 4553005, Harvard University Department of Economics.
  57. Max Nathan, 2011. "The Economics of Super-Diversity: Findings from British Cities, 2001-2006," SERC Discussion Papers 0068, Spatial Economics Research Centre, LSE.
  58. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
  59. Max Nathan, 2011. "The economics of super-diversity: findings from British cities, 2001-2006," LSE Research Online Documents on Economics 33578, London School of Economics and Political Science, LSE Library.
  60. Stephan Brunow & Georg Hirte, 2009. "The age pattern of human capital and regional productivity: A spatial econometric study on german regions," Papers in Regional Science, Wiley Blackwell, vol. 88(4), pages 799-823, November.
  61. Wooldridge, Jeffrey M., 2009. "On estimating firm-level production functions using proxy variables to control for unobservables," Economics Letters, Elsevier, vol. 104(3), pages 112-114, September.
  62. Carmine Ornaghi, 2006. "Assessing the effects of measurement errors on the estimation of production functions," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 21(6), pages 879-891.
  63. Neil Lee, 2015. "Migrant and ethnic diversity, cities and innovation: Firm effects or city effects?," Journal of Economic Geography, Oxford University Press, vol. 15(4), pages 769-796.
  64. Zwick, Thomas, 2004. "Employee participation and productivity," Labour Economics, Elsevier, vol. 11(6), pages 715-740, December.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp6845. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.