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On the Dynamics of Ethnic Fractionalization

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  • Campos, Nauro F
  • Kuzeyev, Vitaliy

Abstract

Does fractionalization change over (short periods of) time? If so, are there any substantial implications for economic performance? To answer such questions, we construct a new panel data set with measures of fractionalization for 26 former communist countries covering the period from 1989 to 2002. Our fractionalization measures show that transition economies became more ethnically homogenous over such a short period of time, although the same did not happen in terms of linguistic and religious fractionalization. In line with the most recent literature, there seems to be no effect of (exogenous) fractionalization on macroeconomic performance (that is, on per capita GDP growth). However, we find that dynamic ethnic fractionalization is negatively related to growth (although this is still not the case for linguistic and religious fractionalization). These findings are robust to different specifications, polarization measures, instrument sets as well as to a composite index of ethnic-linguistic-religious fractionalization.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6360.

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Date of creation: Jun 2007
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Handle: RePEc:cpr:ceprdp:6360

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Keywords: ethnic fractionalization; growth; polarization; transition economies;

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Cited by:
  1. Beugelsdijk, Sjoerd & Slangen, Arjen & Maseland, Robbert & Onrust, Marjolijn, 2014. "The impact of home–host cultural distance on foreign affiliate sales: The moderating role of cultural variation within host countries," Journal of Business Research, Elsevier, vol. 67(8), pages 1638-1646.
  2. Olsson, Ola & Valsecchi, Michele, 2010. "Quantifying Ethnic Cleansing: An Application to Darfur," Working Papers in Economics 479, University of Gothenburg, Department of Economics.
  3. Valsecchi, Michele, 2010. "Ethnic diversity, economic performance and civil wars," Working Papers in Economics 433, University of Gothenburg, Department of Economics.
  4. Javier Gardeazabal, 2011. "Linguistic polarization and conflict in the Basque Country," Public Choice, Springer, vol. 149(3), pages 405-425, December.
  5. Philipp Kolo, 2011. "Questioning Ethnic Fragmentation's Exogeneity - Drivers of Changing Ethnic Boundaries," Ibero America Institute for Econ. Research (IAI) Discussion Papers 210, Ibero-America Institute for Economic Research.
  6. Testa, Cecilia, 2012. "Is polarization bad?," European Economic Review, Elsevier, vol. 56(6), pages 1104-1118.
  7. Kelly LABART, 2010. "What is hidden behind the indicators of ethnolinguistic fragmentation?," Working Papers I07, FERDI.
  8. Kelly LABART, 2010. "What is hidden behind the indicators of ethnolinguistic fragmentation?," Working Papers I07, FERDI.

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