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Spillovers from immigrant diversity in cities

Thomas Kemeny () and Abigail Cooke

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Using comprehensive longitudinal matched employer-employee data for the U.S., this paper provides new evidence on the relationship between productivity and immigration-spawned urban diversity. Existing empirical work has uncovered a robust positive correlation between productivity and immigrant diversity, supporting theory suggesting that diversity acts as a local public good that makes workers more productive by enlarging the pool of knowledge available to them, as well as by fostering opportunities for them to recombine ideas to generate novelty. This paper makes several empirical and conceptual contributions. First, it improves on existing empirical work by addressing various sources of potential bias, especially from unobserved heterogeneity among individuals, work establishments, and cities. Second, it augments identification by using longitudinal data that permits examination of how diversity and productivity co-move. Third, the paper seeks to reveal whether diversity acts upon productivity chiefly at the scale of the city or the workplace. Findings confirm that urban immigrant diversity produces positive and nontrivial spillovers for U.S. workers. This social return represents a distinct channel through which immigration generates broad-based economic benefits.

Keywords: immigrants; diversity; productivity; spillovers; cities (search for similar items in EconPapers)
JEL-codes: F22 J61 O18 O4 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eff, nep-geo, nep-mig and nep-ure
Date: 2015-06
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http://eprints.lse.ac.uk/64616/ Open access version. (application/pdf)

Related works:
Journal Article: Spillovers from immigrant diversity in cities (2018) Downloads
Working Paper: Spillovers from Immigrant Diversity in Cities (2015) Downloads
Working Paper: Spillovers from Immigrant Diversity in Cities (2015) Downloads
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