APPLIED MICRO: Religious Divisions and Production Technology: Experimental Evidence from India; Dr Arkadev GHOSH (Briq Institute)

Abstract

This paper implements a field experiment in India to understand whether the effects of religious diversity on productivity and attitudes depend on a firm's production technology. I randomly assigned Hindu and Muslim workers at a manufacturing plant in West Bengal to religiously mixed or homogeneous teams. Production tasks are categorized as high- or low-dependency based on the degree of continuous coordination required for production. I find that mixed teams are less productive than homogeneous teams in high-dependency tasks, but this effect attenuates completely in four months. In low-dependency tasks, diversity does not affect productivity. Despite lowering short-run productivity, mixing improves out-group attitudes for Hindu workers in high-dependency tasks — but there are little or no effects in low-dependency tasks. The improvements in production and attitudes in high-dependency tasks are consistent with the minority (Muslim) workers initiating and paying the cost of integration. Overall, this pattern of results suggests that technology that incentivizes individuals to learn to work together is important in overcoming existing intergroup differences — and leads to improved relations and team performance.

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