Measuring social diversity in economic literature: An overview for cross‐country studies

Over recent decades, the growing research on social diversity at country level has striven to explain several outcomes such as the differences in income across countries and the origins of civil conflicts. The literature employs a wide range of indices to measure social diversity that hinders the comparison of the results with respect to their effects on socio‐economic performance. This paper intends to disentangle such a variety of indices and their applications. To achieve this goal, we have collected the social diversity indices used in cross‐country studies, and have ascertained not only their similarities and differences, and the relationships between them, but also their main applications. Studies at country level have been selected that construct their own indices and that make their databases available. We show that the dimension and the index chosen to measure social diversity, the level of disaggregation of the social groups, and the geographical unit of analysis explain the tangle of indices and the mixed results achieved by the literature focused on socio‐economic outcomes of social diversity. This paper enables the suitable evaluation and comparison of the effects of social diversity and the selection of the appropriate index depending on the analysis to be carried out.