A second dimension along which diversity may matter is in supporting the resilience of social systems in the face of uncertainties and shocks, be it organisations or nation states. Courtesy of behavioural economics, we now know that individuals suffer from a heady cocktail of behavioural biases. 28 Two of the more important are hubris bias (an exaggerated individual sense of ability) and conformity bias (a tendency to act in line with consensus). 29 The first leaves decisions vulnerable to the whims of an over-confident individual, while the second generates insufficient challenge of prevailing orthodoxy, so-called “groupthink”. What links these biases is that they increase greatly the chances of a large, perhaps even catastrophic, error of judgement. History, including economic history, provides a rich catalogue of these errors, from autocratic emperors, kings and rulers overtaken by hubris to inert academics and policymakers consumed by consensus. Fortunately, social institutions have often adapted to lean against these biases. Indeed, some have argued that these institutional safeguards are the reason some nations succeed and others fail. 30 One bulwark against bias comes from placing decision-making in the hands of a committee, diverse in its composition, independent in its mindset. Experimental evidence suggests that, so comprised, committees make for more robust decisions. They do so by avoiding large  21  For example, McKinsey (2015). 22  For example, O’Reilly (1998). 23  Florida (2002), Ottaviano and Peri (2005). 24  Florida (2003). 25  Goldin et al (2011).

These biases in behaviour are similar in spirit, but different in form, to those of primitive man. Both generate negative sentiment towards strangers or the “out-group”. In ancient times, biases were based on the physical identity of strangers; they were overt and visible. Today, many biases are based on the social identity of strangers; they are often covert and subtle. Where primitive man had conscious biases, modern man often has unconscious ones too. 14 That these biases are sometimes covert, rather than overt, does not diminish their importance for society. Unconscious biases are likely to be just as prevalent, and sometimes as pernicious, as conscious one. And precisely because they are harder to detect, sometimes even among those exhibiting these behaviours, unconscious biases are more likely to go unnoticed, and thus unchallenged, than conscious ones. As conscious biases were violent and visible, unconscious biases are silent and invisible. The Sneetches is, at one level, a children’s story with a moral message. At another, it is a case study in social identity theory, a parable for modern times. Even in advanced economies with little fear of conflict or infection, with laws against discrimination and with social norms favouring diversity, we all remain Sneetches. Our biased minds are in part a neurological hangover from our hunter-gatherer past and in part a sociological side-effect of our multicultural present. Either way, these biases are embedded in our brains and behaviours. Diversity as a social good Saying that behavioural biases among individuals are understandable is one thing.