Identity, Diversity, and Team Performance: Evidence from U.S. Mutual Funds

Melissa Porras Prado (), Richard B. Evans and Rafael Zambrana

No 14305, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We examine team diversity and performance in the asset management industry through the lens of identity. Focusing on political ideology as the relevant dimension of identity, we find that diverse teams outperform homogeneous teams. The mechanism involves both improved decision-making due to more diverse perspectives and increased monitoring by heterogeneous team members. The benefits of ideological diversity are undone when political polarization is higher, consistent with increased intra-team conflict. In examining why less diverse teams are prevalent in asset management, we find entrenched managers prefer homogeneous teams, and the local labor market supply of ideologically diverse managers is constrained.

Keywords: Â mutual fund; Teams; Dispersion in beliefs; Diversity; Labor incentives; Political ideology; Campaign contributions; Polarization; Pacs (search for similar items in EconPapers)
JEL-codes: G11 G23 J33 J44 L22 L25 L84 M12 M52 (search for similar items in EconPapers)
Date: 2020-01
New Economics Papers: this item is included in nep-cdm and nep-hrm
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://cepr.org/publications/DP14305 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:14305

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP14305

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().