Tolerance, Cultural Diversity and Economic Growth: Evidence from Dynamic Panel Data Analysis

Alhendi, Osama ORCID:, Tóth, József ORCID:, Lengyel, Péter ORCID: and Balogh, Péter ORCID: (2021) Tolerance, Cultural Diversity and Economic Growth: Evidence from Dynamic Panel Data Analysis. Economies, 9 (1). DOI

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This study aims to examine the impact of social tolerance of cultural diversity, and the ability to speak widely spoken languages, on economic performance. Based on the literature, the evidence is still controversial and unclear. Therefore, the study used panel data relating to (99) non-English speaking economies during the time period between 2009 and 2017. Following the augmented Solow model approach, the related equation was expanded, in this study, to include (besides human capital) social tolerance, the English language (as a lingua franca) and the level of openness. The model was estimated using the two-step system GMM approach. The results show that social tolerance of diversity and English language competence have a positive, but insignificant impact on the economy. Regarding policy implications, government and decision-makers can avoid the costs deriving from cultural diversity by adopting democratic and effective institutions that aim to achieve cultural justice and recognition, which, in turn, enhance the level of tolerance, innovation and productivity in the economy. Moreover, to ease intercultural communication within heterogeneous communities, it is necessary to invest in enhancing the quality of second language education which is necessary to make society more tolerant and the country more open to the global economy.

Item Type:Article
Uncontrolled Keywords:economic growth, social tolerance, cultural diversity, English proficiency, human capital
Subjects:Economic development
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ID Code:7641
Deposited By: MTMT SWORD
Deposited On:27 Sep 2022 09:54
Last Modified:27 Sep 2022 09:54

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