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Ethnic diversity, economic performance and civil wars

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  • Valsecchi, Michele

    ()
    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Abstract

We develop a conflict model linking dissipation to the distribution of the population over an arbitrary number of groups. We extend the pure contest version of the model by Esteban and Ray (1999) to include a mixed public-private good. We analyze how the level of dissipation changes as the population distribution and the share of publicness of the prize change. First, we find that, in case of pure private goods, the dissipation-distribution relationship resembles the fractionalization index. This may explain the sensitiveness of empirical evidence on the impact of ethnic diversity with respect to outcome (growth, incidence of civil wars) and index (fractionalization, discrete polarization). Second, we find that, in case of pure private goods, smaller groups always contribute more and so the fractionalization index under-estimates their weight. Indeed, we find that the fractionalization index under-estimates the true level of dissipation.

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File URL: http://hdl.handle.net/2077/22040
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Bibliographic Info

Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 433.

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Length: 46 pages
Date of creation: 03 Mar 2010
Date of revision:
Handle: RePEc:hhs:gunwpe:0433

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Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
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Keywords: ethnic diversity; public-private goods; polarization; fractionalization;

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References

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  1. Enrico Spolaore & Romain Wacziarg, 2007. "The Diffusion of Development," Discussion Papers Series, Department of Economics, Tufts University 0704, Department of Economics, Tufts University.
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  8. Jean-Louis ARCAND & Patrick GUILLAUMONT & Sylviane GUILLAUMONT JEANNENEY, 1999. "How To Make A Tragedy: On The Alleged Effect Of Ethnicity On Growth," Working Papers 199903, CERDI.
  9. Montalvo, Jose G. & Reynal-Querol, Marta, 2005. "Ethnic diversity and economic development," Journal of Development Economics, Elsevier, vol. 76(2), pages 293-323, April.
  10. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  11. Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers 536, Harvard - Institute for International Development.
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Cited by:
  1. Olsson, Ola & Valsecchi, Michele, 2010. "Quantifying Ethnic Cleansing: An Application to Darfur," Working Papers in Economics 479, University of Gothenburg, Department of Economics.

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