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Ethnic diversity and economic development with spatial segregation

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  • Bharathi, Naveen
  • Malghan, Deepak
  • Rahman, Andaleeb

Abstract

We revisit the negative association between ethnic diversity and development to show how the diversity-development association is conditional on spatial segregation. We introduce a new census-scale micro-dataset from the Indian state of Karnataka (n = 36.5 million rural residents). Using the first-ever spatially explicit enumeration and coding of endogamous Indian caste groups (jatis), we develop a multi-group metric for measuring local spatial segregation. We find that diversity is a bane for development only when it is also accompanied by high levels of spatial segregation. Our results contribute to the emerging research on the implications of inter-group contact and spatial proximity for economic outcomes.

Suggested Citation

  • Bharathi, Naveen & Malghan, Deepak & Rahman, Andaleeb, 2023. "Ethnic diversity and economic development with spatial segregation," Economics Letters, Elsevier, vol. 222(C).
    • Handle: RePEc:eee:ecolet:v:222:y:2023:i:c:s0165176522004256
    DOI: 10.1016/j.econlet.2022.110951
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