Cultural and Social Diversity as an Economic Resource


The paper seeks to identify the role of cultural and social diversity in economic development. It starts by defining the terms that are critical to the analysis, including diversity, fractionalization, polarization, social diversity, cultural diversity and economic resources, as well as providing the most significant indexes thereof. The main body of the paper interprets the notions of cultural and social diversity in terms of being a valuable economic resource. Furthermore, it collects a vast body of literature to demonstrate the relationship between the cultural/social diversity and economic development with regard to adverse or positive impact on the latter. In regard to the negative impact of diversity, the paper identifies it in the area of social communication, social capital and networks, as it effectively causes a decrease in productivity and increase in social conflict and isolation. The positive link is demonstrated with examples in the areas of innovation, creativity, usage of complementary abilities and experiences, and their role in increasing productivity. The paper refers to numerous data sources, studies and indexes illustrating how the economic systems of various countries perform in the context of the paper’s subject-matter.

Ager Philipp, Brückner Markus, 2013, Cultural Diversity and Economic Growth: Evidence from the US during the Age of Mass Migration, “European Economic Review,” Vol. 64: 76–97.

Alesina Alberto, Devleeschauwer Arnaud, Easterly William, Kurlat Sergio, Wacziarg Romain, 2003, Fractionalization, “Journal of Economic Growth,” Vol. 8, Issue 2: 155–194.

Alesina Alberto, Harnoss Johann, Rapoport Hillel, 2016, Birthplace Diversity and Economic Prosperity, “Journal of Economic Growth,” Vol. 21, Issue 2: 101–138.

Alesina Alberto, La Ferrara Eliana, 2000, Participants in Heterogeneous Communities, “Quarterly Journal of Economics,” Vol. 115, Issue 3: 847–904.

Alesina Alberto, La Ferrara Eliana, 2005, Ethnic Diversity and Economic Performance, “Journal of Economic Literature,” Vol. 43, No. 3: 762–800.

Ashraf Quamrul, Galor Oded, 2011, Cultural Diversity, Geographical Isolation, and the Origin of the Wealth of Nations, NBER Working Papers 17640, National Bureau of Economic Research, Inc.

Azzimonti Marina, 2011, Barriers to Investment in Polarized Societies, “American Economic Review,” Vol. 101, Issue 5: 2182–2204.

Barro Robert J., 1999, Determinants of Democracy, “Journal of Political Economy,” Vol. 107, No. S6: S158–S183.

Bove Vincenzo, Elia Leandro, 2016, Cultural Heterogeneity and Economic Development, “The Centre for Economic Policy Research,” ( [1.11.2020]).

Bove Vincenzo, Elia Leandro, 2017, Migration, Diversity, and Economic Growth, “World Development,” Vol. 89, Issue C: 227–239.

Collier Paul, 2000, Ethnicity, Politics, and Economic Performance, “Economics and Politics,” Vol. 12, Issue 3: 225–245.

Crystal David, 2000, Language Death, Cambridge University Press, Cambridge.

Dahrendorf Ralf, 1999, The Third Way and Liberty, “Foreign Affairs,” Vol. 78, Issue 5: 13–17.

Diamond Jared, 1997, Guns, Germs and Steel: The Fates of Human Societies, W. W. Norton & Co., New York.

Docquier Frédéric, Turati Riccardo, Valette Jérôme, Vasilakis Chrysovalantis, 2019, Birthplace Diversity and Economic Growth: Evidence from the US States in the Post-World War II Period, “Journal of Economic Geography,” Vol. 20, Issue 2: 321–354.

Easterly William, Levine Ross, 1997, Africa’s Growth Tragedy: Policies and Ethnic Divisions, “Quarterly Journal of Economics,” Vol. 112, Issue 4: 1203–1250.

Esteban Joan, Ray Debraj, 1999, Conflict and Distribution, “Journal of Economic Theory,” Vol. 87, Issue 2: 379–415.

Esteban Joan, Ray Debraj, 2011a, A Model of Ethnic Conflict, “The Journal of the European Economic Association,” Vol. 9, Issue 3: 496–521.

Esteban Joan, Ray Debraj, 2011b, Linking Conflict to Inequality and Polarization, “American Economic Review,” Vol. 101, Issue 4: 1345–1374.

Fearon James D., 2003, Ethnic and Cultural Diversity by Country, “Journal of Economic Growth,” Vol. 8, No. 2: 195–222.

Florida Richard, Tingali Irene, 2004, Europe in the Creative Age, Carnegie Mellon Software Industry Center, Pittsburgh.

Gören Erkan, 2013, Economic Effects of Domestic and Neighbouring Countries’ Cultural Diversity, “Oldenburg Discussion Papers in Economics,” No. V-352-13, University of Oldenburg, Department of Economics, Oldenburg.

Grafton R. Quentin, Knowles Stephen, Owen P. Dorian, 2004, Total Factor Productivity, per Capita Income and Social Divergence, “Economic Record,” Vol. 80, Issue 250: 302–313.

Greif Avner, 1993, Contract Enforceability and Economic Institutions in Early Trade: The Maghribi Traders’ Coalition, “American Economic Review,” Vol. 83, No. 3: 525–548.

Grim Brian J., Finke Roger, 2007, Religious Persecution in Cross-National Context: Clashing Civilizations or Regulated Economies?, “American Sociological Review,” Vol. 72, No. 4: 633–658.

Hlepas Nikolaos, 2013, Cultural Diversity and National Performance, International Centre for Black Sea Studies (ICBSS), Athens, Greece.

Lane Philip, Tornell Aaron, 1996, Power, Growth, and the Voracity Effect, “Journal of Economic Growth,” Vol. 1, No. 2: 213–241.

Lazear Edward, 1999, Globalisation and the Market for Team-Mates, “Economic Journal,” Vol. 109, Issue 454: C15–C40.

Levinson David, 1998, Ethnic Groups Worldwide. A Ready Reference Handbook, Oryx Press, Phoenix.

Maddison Angus, 2001, The World Economy: A Millennial Perspective, OECD, Paris.

Montalvo José G., Reynal-Querol Marta, 2005a, Ethnic Diversity and Economic Development, “Journal of Development Economics,” Vol. 76, Issue 2: 293–323.

Montalvo José G., Reynal-Querol Marta, 2005b, Ethnic Polarization, Potential Conflict, and Civil Wars, “American Economic Review,” Vol. 95, Issue 3: 796–816.

Nijkamp Peter, Poot Jacques, 2015, Cultural Diversity: A Matter of Measurement, “IZA Discussion Paper” No. 8782, The Institute for the Study of Labor (IZA), Bonn.

North Douglass C., Thomas Robert P., 1973, The Rise of the Western World: A New Economic History, Cambridge University Press, Cambridge.

Okediji Tade O., 2011, Social Fragmentation and Economic Growth: Evidence from Developing Countries, “Journal of Institutional Economics,” Vol. 7, Issue 1: 77–104.

Putnam Robert D., 2006, E Pluribus Unum: Diversity and Community in the Twenty-first Century: The 2006 Johan Skytte Prize Lecture, “Scandinavian Political Studies,” Vol. 30, Issue 2: 137–174.

Reese-Cassal Kyle, 2014, 2014/2019 Esri Diversity Index. An Esri White Paper, Esri, Redlands, California.

Ridley Matt, 2010, Humans: Why They Triumphed, “The Wall Street Journal,” May 22: W1.

Schaefer Richard T., 2016, Sociology: A Brief Introduction, McGraw-Hill, New York, NY.

Shleifer Andrei, Vishny Robert W., 1993, Corruption, “Quarterly Journal of Economics,” Vol. 108, No. 3: 599–617.

Sobel Russell, Dutta Nabamita, Roy Sanjukta, 2010, Does Cultural Diversity Increase the Rate of Entrepreneurship?, “Review of Austrian Economics,” Vol. 23, Issue 3: 269–286.

Taylor Charles L., Hudson Michael C., 1972, The World Handbook of Political and Social Indicators, Yale University Press, New Haven.

Tornell Aaron, Lane Phillip R., 1999, The Voracity Effect, “American Economic Review,” Vol. 89, Issue 1: 22–46.

Tylor Edward B., 1958, The Origins of Culture, Harper & Brothers, New York, NY, (originally 1871).

VanAlstine Jason, Cox Steven R., Roden Dianne M., 2013, The Costs and Benefits of Diversity: Are Religious Differences Most Important?, “Journal of Global Business Issues,” Vol. 7, Issue 2: 9–20.

VanAlstine Jason, Cox Steven R., Roden Dianne M., 2015, Cultural Diversity in the United States and Its Impact on Human Development, “Journal of the Indiana Academy of the Social Sciences,” Vol. 18, Issue 1, Article 10: 125–143.

Warf Barney, Vincent Peter, 2007, Religious Diversity across the Globe: A Geographic Exploration, “Social and Cultural Geography,” Vol. 8, Issue 4: 597–613.

Weber Max, 1905 (1930), The Protestant Ethic and the Spirit of Capitalism, Allen & Unwin, London.

Opublikowane : 2021-06-28

Pyrkosz, D. S. (2021). Cultural and Social Diversity as an Economic Resource. Kultura I Społeczeństwo, 65(2), 141-155.

Damian S. Pyrkosz
University of Rzeszów  Polska