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Evidence from Spatial Correlation of Poverty and Income in Kenya

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  • Hamaguchi, Nobuaki

Abstract

Using the district-level data, we found that even in a relatively poor country like Kenya, ethnic diversity is associated with better economic outcomes at local level. However, we found that income spillovers depend on ethnic similarity. This suggests the influence of ethnic bias through which ethnic diversity may undermine economic efficiency at the national-level, as many crosscountry regressions have pointed out. This result implies, for policy making, that the question of interregional transaction costs cannot be narrowly focused on problems of transportation infrastructure but it is also related with ethnic divisions in African context.

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File URL: http://hdl.handle.net/10685/61
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File URL: http://repository.ri.jica.go.jp/dspace/bitstream/10685/61/1/JICA-RI_WP_No.35_2011_2.pdf
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Bibliographic Info

Paper provided by JICA Research Institute in its series Working Papers with number 35.

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Date of creation: 14 Nov 2011
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Handle: RePEc:jic:wpaper:35

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Keywords: ethnic bias ; spatial correlation ; regional economy;

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  1. Miguel, Edward & Gugerty, Mary Kay, 2005. "Ethnic diversity, social sanctions, and public goods in Kenya," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2325-2368, December.
  2. Montalvo, Jose G. & Reynal-Querol, Marta, 2005. "Ethnic diversity and economic development," Journal of Development Economics, Elsevier, vol. 76(2), pages 293-323, April.
  3. Anthony J. Venables, 2010. "Economic geography and African development," Papers in Regional Science, Wiley Blackwell, vol. 89(3), pages 469-483, 08.
  4. Robert H. Bates, 2000. "Ethnicity and Development in Africa: A Reappraisal," American Economic Review, American Economic Association, vol. 90(2), pages 131-134, May.
  5. Maarten Bosker & Harry Garretsen, 2012. "Economic Geography and Economic Development in Sub-Saharan Africa," World Bank Economic Review, World Bank Group, vol. 26(3), pages 443-485.
  6. Jellal, Mohamed & Zenou, Yves, 2006. "Ethnic diversity market structure and risk sharing in developing countries," MPRA Paper 38435, University Library of Munich, Germany.
  7. Alesina, Alberto & La Ferrara, Eliana, 2005. "Ethnic Diversity and Economic Performance," Scholarly Articles 4553005, Harvard University Department of Economics.
  8. Marcel Fafchamps, 2004. "Market Institutions in Sub-Saharan Africa: Theory and Evidence," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062364, December.
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