Many names, many gains? How local diversity in Germany affects innovation

Anna Kremer

No 02/25, CEPIE Working Papers from Technische Universität Dresden, Center of Public and International Economics (CEPIE)

Abstract: Meeting others with different backgrounds brings up new ideas. This paper shows that this not only matters for a background in heterogeneous industries or nationalities, but that regional differences matter too. Regions within a country vary in their traditions and culture. Cultural homogeneity within regions becomes mixed due to internal migration, which, like international migration, increases the diversity of a place. In a novel approach, I look at diversity in German municipalities, measured by different family names, and investigate its effect on the number of generated patents. I use a unique dataset from a 1996 phonebook and casualty lists from WWI. There is a positive association between innovation and diversity when defined by the share of new names, a deconcentration measure, or a Shannon index. Causality is established by using instrumental variables estimations with historical borders. I show that intra-country diversity affects patenting positively and conclude that regional differences matter for economic outcomes.

Keywords: cultural diversity; innovation; family names; patents; local level; Germany (search for similar items in EconPapers)
JEL-codes: O30 R11 Z13 (search for similar items in EconPapers)
Date: 2025
New Economics Papers: this item is included in nep-eur, nep-his, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:tudcep:333401

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