Impact of cultural diversity on wages, evidence from panel data

Simonetta Longhi

Regional Science and Urban Economics, 2013, vol. 43, issue 5, 797-807

Abstract: This paper combines individual data from the British Household Panel Survey and yearly population estimates for England to analyse the impact that cultural diversity has on individual wages. Do people living in more diverse areas earn higher wages after controlling for other observable and unobservable characteristics? The results show that cultural diversity is positively associated with wages, but only when cross-section data are used, while panel data estimations show no impact of diversity. Since natives with comparatively higher skills – and wages – tend to self-select into more diverse areas, cross-section analyses may produce upwardly biassed results.

Keywords: Cultural diversity; Wages; Panel data (search for similar items in EconPapers)
JEL-codes: J31 R23 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:43:y:2013:i:5:p:797-807

DOI: 10.1016/j.regsciurbeco.2013.07.004

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