When it comes to issues of race, gender, and diversity in organizations, researchers have revealed the problems in ever more detail. We have found a lot less to say about what does work — what organizations can do to create the conditions in which stigmatized groups can reach their potential and succeed. That’s why my collaborators — Nicole Stephens at the Kellogg School of Management and Ray Reagans at MIT Sloan — and I decided to study what organizations can do to increase traditionally stigmatized groups’ performance and persistence, and curb the disproportionately high rates at which they leave jobs. Read More »
MIT Sloan Assistant Professor of Organizational Studies Evan Apfelbaum discusses how diversity changes the way we behave.
Apfelbaum says the key to social friction is understanding how to use it.
He and his fellow researchers examined how questions of race impacted adults and children, using a game similar to Guess Who? to gauge why people are more hesitant to talk about race as they get older.
How much value is truly created by a room full of women gathering to talk about women’s issues when the problem is a systemic product of social biases held by both women and men? Do these almost exclusively female events further tie “women’s issues” to a certain social stigma?
As a member of MIT Sloan’s Society for Women in Management (SWIM) and former co-president of my undergraduate Society for Women in Business organization with heavy exposure to inclusive leadership and diversity training, I have attended my fair share of conferences and events geared towards women’s empowerment in business – an issue that I care deeply about. Each event has been inspiring both personally and professionally and has offered me phenomenal networking opportunities. Read More »
We usually think of ethnic diversity as a matter of social policy, not a factor that could impede market bubbles. But new research by me and a team of colleagues suggests a surprising new reason to consider diversity as a hedge against speculative bubbles: in two studies, we find that markets comprised of ethnically diverse traders are more accurate in pricing assets than ethnically homogeneous ones. Our paper, which came out Nov. 17 in Proceedings of the National Academy of Sciences (PNAS), finds that ethnic diversity leads all traders, whether of majority or minority ethnicity, to price more accurately and thwart bubbles. The reason isn’t because minority traders had special information or differential skills; rather, their mere presence changed how everyone approached decision-making. Traders were more apt to carefully scrutinize others’ transactions and less likely to copy others’ errors in diverse markets, and this reduced the incidence of bubbles.
To conduct our research, we constructed experimental markets in the United States and Singapore in which participants traded stocks to earn real money. We randomly assigned participants to ethnically homogenous or diverse markets. We found that markets comprised of diverse traders did a 58 percent better job at pricing assets to their true value. Overpricing was higher in homogenous markets because traders are more likely to accept speculative prices, we found. Their pricing errors were more correlated than in diverse markets. And when bubbles burst, homogenous markets crashed more severely.
Companies promote diversity in the workplace as a moral imperative with “bottom line benefits.” But research on the value of diversity is mixed. Some studies have found diverse teams—meaning workgroups comprised of employees of different races, genders, and backgrounds—promote creativity, nurture critical thinking, and tend to make better, more thoughtful decisions because they consider a wider range of perspectives. Other studies indicate diverse teams fuel interpersonal conflicts, reduce cohesion, and slow the pace of learning.