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The Causal Effects of Ethnic Diversity: An Instrumental Variables Approach

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Author Info
Ahlerup, Pelle () (Department of Economics, School of Business, Economics and Law, Göteborg University)
Abstract

Ethnic diversity is endogenous to economic development in the long run. Yet the standard approach in economic research is to treat ethnic diversity as an exogenous factor. By identifying instruments for ethnic diversity, we correct this misspeci ca- tion and establish that ethnic diversity has an exogenous in uence on income levels, economic growth, corruption, and provision of public goods. Earlier results based on OLS estimations may have underestimated the negative e¤ects of high levels of ethnic diversity.

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File URL: http://hdl.handle.net/2077/21201
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Publisher Info
Paper provided by Göteborg University, Department of Economics in its series Working Papers in Economics with number 386.

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Length: 19 pages
Date of creation: 05 Oct 2009
Date of revision:
Handle: RePEc:hhs:gunwpe:0386

Contact details of provider:
Postal: Department of Economics, School of Business, Economics and Law, Göteborg University Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
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Related research
Keywords: economic development; ethnic diversity; instrumental variables; property rights;

Find related papers by JEL classification:
O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
O43 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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This page was last updated on 2009-12-4.

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