Monday, April 10, 2017

Diversity and economic well-being

Whether it is the US or the UK or France or ... aren't the political events related to this confluence of diversity and economic well-being?

Think about California's Silicon Valley.  A whole bunch of people from all over the world, right?  That is to be expected; after all, the Golden State demographics is heavily tilted towards foreign-born:
With 27 percent of California’s total population foreign-born — or not quite 10.5 million people — the state has more immigrants numerically than any other state and the greatest proportion of its total residents who are immigrants.
Now think about West Virginia.  Guess what?
West Virginia has the lowest portion of foreign-born people at 1.4 percent of the state’s total 1.8 million residents
Hmmm ... Silicon versus coal.  It is not mere coincidence, is it?

It is not any coincidence at all.  Modern economic activities are urban-based.  So, if some states and cities are drawing more foreign-born .... then? There is "a strong relationship between greater immigrant diversity and higher productivity—in this case, wages."
Diverse immigrant populations do more than enrich a city's cultural fabric. According to geographers from the University at Buffalo and Southampton University, they also boost wages. "What we found was remarkable. In cities that are unwelcoming to immigrants, as diversity rises, people's wages either don't change, or they go up by only a small amount. In cities that are welcoming to immigrants, as diversity goes up, people's wages go up, and by a lot," said Abigail Cooke, an assistant professor of geography in UB's College of Arts and Sciences. Cooke wrote the paper with Thomas Kemeny, a UB research assistant professor and a lecturer at the University of Southampton in England. The findings were published online ahead of print in the journal Economic Geography. "It's been shown empirically that as you have more immigrants and greater diversity of immigrants in a city, people's wages also increase, which is certainly not the narrative that is often told about immigrants in our society. But this is a pretty robust finding, especially in the U.S." 
This connection has been clear for a while.  In fact, Richard Florida was pretty much able to write his ticket based on these economic geography aspects.  The "creative class" of immigrants were no different from the native creative class:
The knowledge workers, techies, and artists and other cultural creatives who made up the creative class were locating in places that had lots of high-paying jobs—or a thick labor market. They also had what I called a thick mating market—other people to meet and date—and a vibrant quality of place, with great restaurants and cafés, a music scene, and an abundance of things to do.
They were not going to West Virginia.

Florida writes:
It became increasingly clear to me that the same clustering of talent and economic assets generates a lopsided, unequal urbanism in which a relative handful of superstar cities, and a few elite neighborhoods within them, benefit while many other places stagnate or fall behind. Ultimately, the very same force that drives the growth of our cities and economy broadly also generates the divides that separate us and the contradictions that hold us back.
Which is also why trump became president:
These political cleavages ultimately stem from the far deeper economic and geographic structures of the New Urban Crisis. They are the product of our new age of winner-take-all urbanism, in which the talented and the advantaged cluster and colonize a small, select group of superstar cities, leaving everybody and everywhere else behind. Much more than a crisis of cities, the New Urban Crisis is the central crisis of our time.
The diversity of immigration promotes economic advancement ... but that advancement does not seem to reach the corners of West Virginia or Pennsylvania.  Voters could then either try to understand the complexities of the rapidly evolving global technological economy.  Or, they could simplistically find that the immigrants are at fault.  And cheer on, and vote for, a fuhrer who would point to anybody who is not white as the reason why they were falling behind in West Virginia.  They voted for that despicable human being who cared not for the logic and evidence, and who cared not for serious policies for long-term solutions to these issues.

Caption at the source:
 Donald Trump supporters pose with a Confederate flag at a campaign rally in Jacksonville, Florida


Ramesh said...

Interesting. The link between diversity and success is more obvious, but that leads to some form of classification is an intriguing concept.

The one place where homogeneity, rather than diversity has also lead to relative success is China. There is zero diversity there. And yet ....

I think the American example is as much about diversity as meritocracy. Only the most talented and determined come. Some filtering is taking place there which is more than plain diversity.

Sriram Khé said...

Nope, this post does not apply to most countries on this planet, because there is no concept of immigration and "others" moving in.

Yes, there is the filtering ... but, filtering happens with Canada or Australia, for instance, with their points-based immigration that does not give priority to the family reunification that the US does ... I would suspect that there too, like in the US, we will find a high degree of correlation between where immigrants choose to go and the economies of those regions. After all, talented or otherwise, immigrants cannot afford to end up jobless in a downtrodden economy ...

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