Question

We are all aware of the theoretical expected benefits of diversity. However, decisions are made by both expected marginal benefit of an actions compared to the expected marginal COSTS of actions, right?

What are the economic costs of diversity in the labor market?

Assume that you only speak Spanish and you are working with Bob, an English only speaking coworker, can you see any potential issues?

Comment!

(From the professor:  I don't ask about benefits of diversity, and Hiring the best employee is always the top choice of the business" This is certainly NOT true. Why?)

Answer 1

Ans.
Yes, it’s true that decisions are made when expected marginal benefit of an actions outweigh compared to the expected marginal COSTS of actions.
It is also true that diversity helps in improving the benefits because when we have diversity it also bring in diversity of thoughts, ideas, perspective and oranisation can benefit from diverse decision making that have positive impact on the organization.
In the given scenario when I only speak Spanish and you are working with Bob, an English only speaking coworker, yes there will be potential issues in communication, interaction, discussion on key issues and in sharing ideas and suggestions. However, these challenges can be only near term and can be improved by translation mechanisms or by learning new languages, I can learn English and improve my skill as well.
Hiring the best employee is not always the TOP choice. We may hire the top candidate but if he or she is not good at attitude or team player or bring diverse capabilities and skills in the existing team it will not help the organization. SO its important to hire someone who is not only talented but also bring diversity of skills and thoughts and capabilities which supplement the team and overall growth of the organization.