A Diversity study on the National Basketball Association: How the Ethnic and Gender Makeup in Executive Management Affects Team Performance

Abstract

Research on the implications of gender and ethnic diversity in corporate management teams for corporate performance has found mixed results. In this thesis, I study this question in a unique context of a professional sports league. This setting provides an excellent laboratory, because performance metrics are easily measured. Using ticket sales and win percentage as indicators of success in the National Basketball Association, I examine whether having a more gender diverse front office at the rank of vice president and above (executive management), or having a more ethnically diverse executive management team among five possible ethnic categories improves team outcomes. I use panel data for all 30 teams across the 2010-2018 seasons, and control for the experience of the executive management team and for two indicators of token female or minority representation. Across a variety of specifications using fixed effects, lags, and instruments for the composition of the management, I too find mixed results; the measures of diversity had no statistically significant effect on ticket sales or win percentage in most specifications.