Inherited Cultural Diversity and Wages Surname-Based Evidence

Are skill sets of immigrants and native workers complementary? The present paper shows that culture and cultural diversity are persistent over generations and that inherited cultural diversity generates a positive wage externality in local labor markets. The effect does not stem from the plurality but from the presence of a large number of people whose cultural background deviates from that of the majoritarian group. We find that the cultural diversity externality is particularly large where cultural backgrounds are also diverse across occupations. Our evidence indicates that the collaboration of workers with different cultural backgrounds propagates complex problem solving and complementary task specialization