Corporate Diversity Culture Spillover

Abstract

We study the spillover of corporate diversity culture among interacting firms. Utilizingdata from the U.S. Census, we find that through labor market competition, the opening ofa high-profile plant by a more (less) pro-diversity firm leads to a decrease (increase) in thelocal gender wage gap. Furthermore, changes in the local employer’s gender wage gap canlead to broader changes in the diversity culture of their parent companies. But a culturalspillover occurs only when the leaders of a company are receptive to the new entrant’sculture and an internal learning platform is in place.

Keywords

Tags of Social Finance