Ethnic diversity and firms' export behavior

Media are reporting of companies that are increasing the diversity of their workforce to expand their business internationally. This paper investigates whether these examples constitute pieces of evidence that diversity promotes firms' internationalization. Indeed, diverse companies are like a...

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Bibliographic Details
Published in:European economic review 2016-10, Vol.89, p.248-263
Main Authors: Parrotta, Pierpaolo, Pozzoli, Dario, Sala, Davide
Format: Article
Language:English
Subjects:
Business administration
Ethnic diversity
Expansion
Export
Exports
Globalization
Humanities and Social Sciences
Instrumental variable
Multiculturalism & pluralism
Organizational behavior
Organizational behaviour
Organizational learning
Shift share
Studies
Workplace diversity
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Summary:Media are reporting of companies that are increasing the diversity of their workforce to expand their business internationally. This paper investigates whether these examples constitute pieces of evidence that diversity promotes firms' internationalization. Indeed, diverse companies are like a cosmopolitan world in small scale, in which their employees learn to relate to other cultures. This improves firms' relational capital and ability to market products internationally. To address endogeneity issues, we rely on several empirical strategies, one of which is centered on the well established “shift share” method. Our results are robust across all empirical models, confirming the hypothesis that ethnic diversity favors firms' engagement on international markets.
ISSN:0014-2921
1873-572X
DOI:10.1016/j.euroecorev.2016.08.001