Labor force diversity and firm survival

We analyze the influence that the diversity of individuals, both within a firm and in the region where the firm is located, has on firm survival. We estimate a hazard model using microdata for Swedish firms for the years 2002-2013. Results show that firm-specific diversity in education, age, and gender are positively associated with firm survival. However, firm-specific diversity by place of origin is negatively associated with firm survival. Yet the cultural diversity among the inhabitants in the region where the firm is located enhances firm survival. Magnitudes of the effects vary by region and industrial sector.