Ethnic diversity and well-being

• This paper investigates how ethnic diversity, measured by immigrants' nationalities, influences the well-being of the host country. Using panel data from Germany from 1998 to 2012, we find a positive effect of ethnic diversity on the well-being of German natives. Our finding is robust to alternative definitions of ethnic diversity and to the non-random selection of natives and immigrants into regions. The positive effect of ethnic diversity is stronger for immigrant groups that are culturally and economically closer to Germany. Consistent with this result, we document the existence of two mechanisms explaining the influence of ethnic diversity on well-being: productivity-as captured by immigrants' skills and assimilation-and social capital-particularly in relation to the creation of a multicultural environment.

Subject headings

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business (hsv//eng)

Keyword

Ethnic diversity

Subjective well-being

Assimilation

Multiculturality

cultural-diversity

segregation

immigration

germany

impact

unemployment

innovation

migration

natives

cities

Demography

Business & Economics

Publication and Content Type

ref (subject category)

art (subject category)