Many amateur and professional sports teams are composed of athletes from different racial and demographic groups. In the National Basketball Association (NBA), for example, teams are composed of African-Americans, Caucasians, South Americans, Europeans (East and West), and Asians. Some have argued that diversity may lower psychological attachment and lead to less frequent (not to mention less effective) communication with fellow workers, all of which can adversely affect firm performance (see, for example, M. Kilduff, R. Angelmar and A. Mehta (2000), “Top management-team diversity and firm performance: examining the role of cognitions,” Organization Science, 11(1):21–34). In this study, we test the hypothesis that the potential negative cross-group effects due to team diversity can be overcome by the necessary cooperation inherent in team sports. This hypothesis implies that team racial composition, however diverse, should have no effect on team performance. The extent to which workers in general (and professional basketball players in particular) are unaffected by group diversity is the empirical question that motivates this research note. To quantify the degree of diversity, we use the Herfindahl-Hirschman index (hereafter HHI), a common measure used in studies of industrial concentration and market structure. Here, we consider its use as it applies to racial composition within a team, given by the formula HHI 1⁄4 P n i1⁄41 Gi , where Gi is the fraction of team players Atl Econ J (2009) 37:119–120 DOI 10.1007/s11293-008-9156-4