The economic value of cultural diversity: evidence from US cities

Abstract

as well as workshop participants at FEEM Milan, RSAI Philadelphia, UBC Vancouver and UC Berkeley for helpful discussions and suggestions. We thank Elena Bellini for outstanding research assistance. Ottaviano gratefully acknowledges financial support from Bocconi University and FEEM. Peri gratefully acknowledge financial support form UCLA International Institute. Errors are ours. The views expressed herein are those of the author(s) and not necessarily those of the National Bureau of Economic Research.

Is There Trickle-Down from Tech? Poverty, Employment, and the High-Technology Multiplier in U.S. Cities

“…To address this problem, we also resort to an instrumental variables (IV) approach. Our instrument is a version of the common shift-share instrument used by, amongst others, Ottaviano and Peri (2005) which builds on the likely association between initial industry share and subsequent growth. We take initial employment in each of the four 'tech' industries in 2005 and assume they grow according to the national rate of growth of each sector over the subsequent period.…”

“…This can occur even in high-tech industries: Hall and Kahn (2008) show immigrants in high-technology industries or occupations in Canada actually earn less than non-migrants. Yet in contrast, a growing body of evidence highlights the economic medium-and, increasingly, longterm importance of migrants to cities and regions (Ottaviano & Peri, 2005;Rodríguez-Pose & von Berlepsch, 2014, 2015. Migrants bring new ideas, can help build international links and are particularly likely to be motivated and entrepreneurial.…”

Putting on the moves

“…Whether because people want to live in pluralist communities, or because visible minorities are creating jobs that prompt newcomers to arrive, diversity is a draw. This has been well documented in large cities (e.g., Ottaviano and Peri 2006), but much less for smaller communities.…”

“…Still, the role of ethnic, cultural, and lifestyle diversity in economic development is unclear. While some studies conclude that greater diversity has a positive effect on local wages and economic vitality (Vey and Forman 2002;Ottaviano and Peri 2006) others are either inconclusive or point to a slight negative effect (Lian and Oneal 1997;Brennan et al 2005). Still others have found that an increase in ethnic diversity can cause outmigration of the existing population (Crowder et al 2011).…”

Foreign Workers Are Associated with Innovation, But Why? International Networks as a Mechanism

“…The literature concerning foreign workers is partly concerned with migration/immigration and partly with diversity. One common focus across the varied literature is that immigration produces cultural diversity, which is thought to promote new ideas and perspectives (Ottaviano and Peri 2006;Nathan and Lee 2013) but also potentially to increase conflicts and reduce trust (Jehn, Northcraft, and Neale 1999;Bandiera, Barankay, and Rasul 2005;Putnam 2007). Previous studies have addressed this issue at various scales, from work groups (Chatman and Flynn 2001;Joshi and Roh 2009) via firms (Lee and Nathan 2010;Østergaard Timmermans, and Kristinsson 2011) to regions (Niebuhr 2010;Kemeny 2012) and countries (Easterly and Levine 1997;Hart 2007), and in some cases at multiple scales (Trax, Brunow, and Suedekum 2013;Lee 2014).…”