Abstract
New Zealand society is becoming more heterogeneous. A growing body of international literature suggests that heterogeneity lowers people's contributions towards public goods and social capital. We use two iterations of New Zealand census data to estimate the effect of ethnic, religious, income and language heterogeneity on neighbourhood volunteering rates while controlling for other factors. We use cross-section and fixed-effects analysis under various specifications, measures of diversity, and level of neighbourhood. Our cross-sectional results find that most dimensions of heterogeneity are negatively related with volunteering, consistent with international findings. However, our fixed effects results are much weaker, and cannot fully address the endogeneity problems posed by people's self-selection into neighbourhoods.
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