The Impact of Work Group Diversity on Performance: Large Sample Evidence from the Mutual Fund Industry

30 Pages Posted: 6 Feb 2008  

Michaela Baer

University of Cologne, Centre for Financial Research (CFR)

Alexandra Niessen-Ruenzi

University of Mannheim - Department of Finance

Stefan Ruenzi

University of Mannheim - Department of International Finance

Date Written: September 2007

Abstract

This paper investigates the impact of work group diversity on performance. Analyzing a uniquely large sample of management teams from the U.S. mutual fund industry we find that the influence of diversity on performance depends on the dimension of diversity that is analyzed. Informational diversity has a positive impact on performance, which is driven by tenure diversity as well as educational diversity. Social category diversity has a negative impact on performance, which is mainly driven by gender diversity while age diversity has no strong impact. Our results have important implications for the optimal composition of work groups and for investment strategies of fund investors.

Keywords: Diversity, Teams, Gender, Mutual Funds, Performance

JEL Classification: G23, J21, L22

Suggested Citation

Baer, Michaela and Niessen-Ruenzi, Alexandra and Ruenzi, Stefan, The Impact of Work Group Diversity on Performance: Large Sample Evidence from the Mutual Fund Industry (September 2007). Available at SSRN: https://ssrn.com/abstract=1017803 or http://dx.doi.org/10.2139/ssrn.1017803

Michaela Baer

University of Cologne, Centre for Financial Research (CFR) ( email )

Cologne, 50923
Germany
+49 (0)221 470 7709 (Phone)
+49 (0)221 470 3992 (Fax)

Alexandra Niessen-Ruenzi

University of Mannheim - Department of Finance ( email )

Mannheim, 68131
Germany

Stefan Ruenzi (Contact Author)

University of Mannheim - Department of International Finance ( email )

L9, 1-2
Mannheim, 68131
Germany

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