The Impact of Foreigners on Firm Performance: A Team-Level Analysis

The percentage of foreign born residents in the United States has steadily risen over the past half century. This increase has been even more marked for athletes where, in some cases, the foreign born percent on professional sports rosters has approached 30%. We examine the impact this rise has had on Major League Baseball. In contrast to the previous literature which use aggregate data, we investigate how an individual team’s geographical diversity interacts with its performance across time. We find that a rise in a team’s foreign born percentage increases their ‘on the field’ performance.