The effect of social diversity on regional innovation: Measures and empirical evidence

This paper discusses two measures of Social Diversity that have appeared in the literature, the gay index and the Country of Birth (CoB) index, and compares their effects on regional innovative activity. We distinguish social diversity from tolerance or openness and argue that the gay index can be considered as a proxy for tolerance or openness, whereas the CoB index can better represent social diversity. According to our regression results, it is the CoB index (i.e., social diversity), not the gay index (i.e., tolerance or openness), that presents a significant and positive effect on innovation. Nevertheless, innovative activity in regions is still dominantly determined by local stocks of R&D capital and doctoral scientists and engineers. Copyright © 2011 Inderscience Enterprises Ltd.