Cities, Immigrant Diversity and Complex Problem Solving

This event is part of the GVC/City REDI Seminar Series.

Speaker: Tom Kemeny (University of Southampton)

About the speaker

Dr Thomas Kemeny is Lecturer in Human Geography within Geography and Environment at the University of Southampton.

Tom Kemeny’s research focuses on economic development in cities. Topics of particular interest include: the importance of urban social networks in entrepreneurship and firm performance; the local economics of immigration and cultural diversity; and the role of international trade in reshaping national and regional labour markets. His work on these topics has been supported by public and private institutions including the U.S. National Science Foundation, and the Ewing Marion Kauffman Foundation. His research has been published in geography, economics, and urban planning journals, including the Journal of Economic Geography, World Development and the Journal of Regional Science. In addition, he has advised governments and NGOs on issues of regional and international development, including the Organisation for Economic Co-operation and Development (OECD), the U.S. Economic Development Administration and the World Bank.

Dr. Kemeny joined the University of Southampton as a Lecturer in Human Geography in 2014. He is also a Special Sworn Status Researcher at the United States Census Bureau’s Center for Economic Studies. Prior to his appointment at Southampton, he was a Senior Fellow in Economic Geography at the London School of Economics, as well as a Research Assistant Professor in Public Policy at the University of North Carolina at Chapel Hill. He received his PhD in Urban Planning from the University of California, Los Angeles (UCLA).

Abstract

Cities play host to residents hailing from a wide range of countries. Theory suggests such immigrant diversity can influence worker productivity, both positively and negatively.  Benefits flow from the idea that people born in different countries complement each other in problem solving and innovation, by enabling the combination of different skills, ideas and perspectives. But heterogeneity can also inhibit productivity by raising the costs of co-operation and spurring rent-seeking behaviour. This project makes several contributions to a growing body of empirical work exploring these claims. First, it leverages a rich matched employer-employee dataset for the U.S. that enables us to better account for bias from non-random worker selection, while distinguishing between impacts flowing from diversity manifested at city- and workplace-scales. Second, we ‘stress-test’ motivating theory, examining the extent to which any benefits from diversity are concentrated among workers engaged in complex problem solving and innovation. Results suggest that the benefits of immigrant diversity outweigh the costs. Consistent with theory, the association is concentrated among workers engaged in industries where complex problem solving is particularly important. In light of continued controversy about the economic implications of immigration, this project suggests an additional channel by which immigration improves overall economic well-being.