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Inherited cultural diversity and wages: surname-based evidence

Author

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  • Philipp EhrlGetúlio
  • Leonardo Monasterio

Abstract

This article shows that inherited cultural diversity at the regional level generates a positive wage externality. We use administrative panel data on formally employed individuals in Rio Grande do Sul in Brazil from 2008 to 2013 and apply machine learning to infer the ancestry of workers from their surnames. We distinguish inherited diversity from birthplace diversity and use the plausibly exogenous location of former colonies to build an instrumental variable. The positive wage externality of inherited diversity withstands alternative explanations such as institutional quality, municipality size, human capital externalities, individual productivity differences, and sorting of workers.

Suggested Citation

  • Philipp EhrlGetúlio & Leonardo Monasterio, 2024. "Inherited cultural diversity and wages: surname-based evidence," Journal of Economic Geography, Oxford University Press, vol. 24(4), pages 595-614.
    • Handle: RePEc:oup:jecgeo:v:24:y:2024:i:4:p:595-614.
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    File URL: http://hdl.handle.net/10.1093/jeg/lbae011
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    More about this item

    Keywords

    wage externality; ancestry; immigration; culture; Brazil;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • N16 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Latin America; Caribbean

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