Diversity in Teams

47 Pages Posted: 31 Jan 2023 Last revised: 1 Dec 2023

See all articles by Miaomiao Dong

Miaomiao Dong

Pennsylvania State University, Department of Economics

Tatiana Mayskaya

National Research University Higher School of Economics (Moscow) - International College of Economics and Finance; National Research University Higher School of Economics (Moscow) - Faculty of Economics

Vladimir Smirnov

The University of Sydney - School of Economics

Olivia Taylor

The University of Sydney - School of Economics

Andrew Wait

University of Sydney

Date Written: November 30, 2023

Abstract

From corporate boards to innovative teams, the benefits of diversity are increasingly being praised. In this paper, we investigate how optimal cognitive diversity depends on the nature of production and the objective criterion employed. With a utilitarian objective, when the output of the most productive worker becomes relatively more important, optimal diversity weakly increases. To capture the preferences of a public service provider, a regulated firm or a very risk averse manager, we also consider a Rawlsian objective. While optimal diversity under the Rawlsian objective might decrease as the output of the most productive worker becomes relatively more important, optimal diversity is always weakly higher with the Rawlsian objective than with the utilitarian one. Our result suggests that a diverse outcome can be achieved by adjusting a team's objective rather than controlling diversity directly.

Keywords: cognitive diversity, submodular, supermodular, teams, utilitarian, Rawlsian objective

JEL Classification: L23, M14

Suggested Citation

Dong, Miaomiao and Mayskaya, Tatiana and Smirnov, Vladimir and Taylor, Olivia and Wait, Andrew, Diversity in Teams (November 30, 2023). Available at SSRN: https://ssrn.com/abstract=4343715 or http://dx.doi.org/10.2139/ssrn.4343715

Miaomiao Dong

Pennsylvania State University, Department of Economics ( email )

University Park, PA
United States

Tatiana Mayskaya (Contact Author)

National Research University Higher School of Economics (Moscow) - International College of Economics and Finance ( email )

Pokrovski Bulvar 11, Korpus Zh, Office 715
Moscow, 109028
Russia

National Research University Higher School of Economics (Moscow) - Faculty of Economics ( email )

Shabolovka 26
Moscow, 119049
Russia

Vladimir Smirnov

The University of Sydney - School of Economics ( email )

Rm 370 Merewether (H04)
The University of Sydney
Sydney, NSW 2006 2008
Australia

Olivia Taylor

The University of Sydney - School of Economics ( email )

Andrew Wait

University of Sydney ( email )

School of Economics
University of Sydney, NSW 2006
Australia
+61-2-9351-3060 (Phone)
+61-2-9351-4341 (Fax)

HOME PAGE: http://sydney.edu.au/arts/economics/

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