Diversity on the screen

Using hand-collected data on movies from 1998 to 2008, we examine how deep-rooted population diversity in the origin countries of the cast (actors) and the production team (director, writer, and producer) affects movie performance (spectator ratings and box office revenue). We contend that distinguishing between the cast (what is visible by spectators-consumers) and the production team allows an analysis of how “visible diversity” affects performance. Once meticulously controlling for selection-endogeneity concerns, we find that the visible component has a hump-shaped effect on our movie performance measures and mostly drives our findings. We also show that the optimal level of cast diversity (the one that maximizes movie performance) is significantly higher than the sample’s average value.