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CULTURAL DIVERSITY, DISCRIMINATION, AND ECONOMIC OUTCOMES: AN EXPERIMENTAL ANALYSIS
Author(s) -
FERRARO PAUL J.,
CUMMINGS RONALD G.
Publication year - 2007
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.2006.00013.x
Subject(s) - navajo , ethnic group , diversity (politics) , cultural diversity , race (biology) , preference , affect (linguistics) , social psychology , psychology , session (web analytics) , economics , demographic economics , order (exchange) , sociology , gender studies , microeconomics , business , anthropology , philosophy , linguistics , communication , advertising , finance
Does cultural diversity affect economic outcomes? We develop an experimental framework that complements ongoing research on this question. We vary the ethnic mix of bargaining sessions to study intercultural interactions among members of U.S. Hispanic and Navajo cultures. We control for demographic differences in our subject pools and elicit beliefs directly in order to differentiate between statistical discrimination and preference‐based discrimination. Hispanic and Navajo subjects behave differently, and their behavior is affected by the ethnic composition of the experimental session. Our experimental framework can shed light on economic behavior and outcomes in societies of mixed ethnicity, race, and religion. ( JEL C78, C90, Z10)