Is Tolerance Good or Bad for Growth?

Niclas Berggren and Mikael Elinder

No 155, Ratio Working Papers from The Ratio Institute

Abstract: We investigate to what extent tolerance, as measured by attitudes toward different types of neighbors, affects economic growth. Data from the World Values Survey enable us to investigate tolerance–growth relationships for 54 countries. We provide estimates based on cross-sectional as well as panel-data regressions. In addition we test for robustness with respect to model specification and sample composition. Unlike previous studies, by Richard Florida and others, we find that tolerance toward homosexuals is negatively related to growth. For tolerance toward people of a different race, we do not find robust results, but the sign of the estimated coefficients is positive, suggesting that inclusion of people irrespective of race makes good use of productive capacity. We propose mechanisms to explain these divergent findings, which clarify why different kinds of tolerance may be of different economic importance.

Keywords: Tolerance; Growth; Diversity; Human Capital; Creativity; Innovation (search for similar items in EconPapers)
JEL-codes: O40 Z13 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2010-08-02
New Economics Papers: this item is included in nep-fdg, nep-hrm and nep-soc
Note: Forthcoming in Public Choice.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Forthcoming in Public Choice.

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Related works:
Journal Article: Is tolerance good or bad for growth? (2012)
Working Paper: Is Tolerance Good or Bad for Growth? (2010)
Working Paper: Is tolerance good or bad for growth? (2010)
Working Paper: Is tolerance good or bad for growth? (2010)
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