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Public Goods and Ethnic Divisions

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  • Baqir, Reza
  • Easterly, William
  • Alesina, Alberto

Abstract

We present a model that links heterogeneity of preferences across ethnic groups in a city to the amount and type of public goods the city supplies. We test the implications of the model with three related data sets: U. S. cities, U. S. metropolitan areas, and U. S. urban counties. Results show that the shares of spending on productive public goods—education, roads, sewers and trash pickup—in U. S. cities (metro areas/urban counties) are inversely related to the city's (metro area's/county's) ethnic fragmentation, even after controlling for other socioeconomic and demographic determinants. We conclude that ethnic conflict is an important determinant of local public finances.

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Bibliographic Info

Paper provided by Harvard University Department of Economics in its series Scholarly Articles with number 4551797.

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Date of creation: 1999
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Publication status: Published in Quarterly Journal of Economics
Handle: RePEc:hrv:faseco:4551797

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  1. Alberto Alesina & Enrico Spolaore, 1995. "On the Number and Size of Nations," NBER Working Papers, National Bureau of Economic Research, Inc 5050, National Bureau of Economic Research, Inc.
  2. Alberto Alesina & Reza Baqir & William Easterly, 1998. "Redistributive Public Employment," NBER Working Papers, National Bureau of Economic Research, Inc 6746, National Bureau of Economic Research, Inc.
  3. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 89(5), pages 914-27, October.
  4. James M. Poterba, 1997. "Demographic structure and the political economy of public education," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 16(1), pages 48-66.
  5. Easterly, William & Levine, Ross, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 112(4), pages 1203-50, November.
  6. Roland Benabou, 1991. "Workings of a City: Location, Education, and Production," NBER Technical Working Papers, National Bureau of Economic Research, Inc 0113, National Bureau of Economic Research, Inc.
  7. Benabou, Roland, 1996. "Equity and Efficiency in Human Capital Investment: The Local Connection," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 63(2), pages 237-64, April.
  8. Epple, Dennis & Romer, Thomas, 1991. "Mobility and Redistribution," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(4), pages 828-58, August.
  9. Weingast, Barry R & Shepsle, Kenneth A & Johnsen, Christopher, 1981. "The Political Economy of Benefits and Costs: A Neoclassical Approach to Distributive Politics," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 89(4), pages 642-64, August.
  10. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 110(3), pages 681-712, August.
  11. Cutler, David M & Glaeser, Edward L, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 112(3), pages 827-72, August.
  12. Rubinfeld, Daniel L & Shapiro, Perry & Roberts, Judith, 1987. "Tiebout Bias and the Demand for Local Public Schooling," The Review of Economics and Statistics, MIT Press, MIT Press, vol. 69(3), pages 426-37, August.
  13. Perotti, Roberto, 1996. " Growth, Income Distribution, and Democracy: What the Data Say," Journal of Economic Growth, Springer, Springer, vol. 1(2), pages 149-87, June.
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  1. Short thoughts, mostly about the decline of America
    by Noah in Noahpinion on 2011-04-29 06:59:00
  2. Why don't Americans value social insurance?
    by Noah in Noahpinion on 2011-02-14 19:59:00
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