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Public Goods and Ethnic Diversity: Evidence from Deforestation in Indonesia

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  • Alberto Alesina
  • Caterina Gennaioli
  • Stefania Lovo

Abstract

This paper shows that the level of deforestation in Indonesia is positively related to the degree of ethnic fractionalization at the district level. To identify a casual relation we exploit the exogenous timing of variations in the level of ethnic heterogeneity due to the creation of new jurisdictions. We provide evidence consistent with a lower control of politicians, through electoral punishment, in more ethnically fragmented districts. Our results bring a new perspective on the political economy of deforestation. They are consistent with the literature on (under) provision of public goods and social capital in ethnically diverse societies and suggest that when the underlying communities are ethnically fractionalized decentralisation can reduce deforestation by delegating powers to more homogeneous communities.

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  • Alberto Alesina & Caterina Gennaioli & Stefania Lovo, 2016. "Public Goods and Ethnic Diversity: Evidence from Deforestation in Indonesia," Working Papers 80, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
  • Handle: RePEc:cgs:wpaper:80
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    Cited by:

    1. Samuel Bazzi & Matthew Gudgeon, 2015. "Local Government Proliferation, Diversity, and Conflict," HiCN Working Papers 205, Households in Conflict Network.
    2. Arnim Langer & Frances Stewart & Maarten Schroyens, 2016. "Horizontal inequalities and affirmative action: An analysis of attitudes towards redistribution across groups in Africa," WIDER Working Paper Series wp-2016-119, World Institute for Development Economic Research (UNU-WIDER).
    3. Sabyasachi Das & Abhiroop Mukhopadhyay & Rajas Saroy, 2018. "Does Affirmative Action in Politics Hinder Performance? Evidence from India," Working Papers 1007, Ashoka University, Department of Economics.
    4. Seidel, André, 2019. "A global map of amenities: Public goods, ethnic divisions and decentralization," Working Papers in Economics 5/19, University of Bergen, Department of Economics.
    5. Bluhm, Richard & Thomsson, Kaj, 2015. "Ethnic divisions, political institutions and the duration of declines," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112863, Verein für Socialpolitik / German Economic Association.
    6. Rivayani Darmawan & Stephan Klasen & Nunung Nuryartono, 2015. "Migration and Deforestation in Indonesia," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 187, Courant Research Centre PEG.
    7. Bluhm R & Thomsson K.M., 2015. "Ethnic divisions, political institutions and the duration of declines: A political economy theory of delayed recovery," MERIT Working Papers 2015-003, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. Barnes, Michele L. & Arita, Shawn & Kalberg, Kolter & Leung, PingSun, 2017. "When does it pay to cooperate? Strategic information exchange in the harvest of common-pool fishery resources," Ecological Economics, Elsevier, vol. 131(C), pages 1-11.
    9. Virgi Sari, 2018. "Educational assistance and education quality in Indonesia: The role of decentralization," WIDER Working Paper Series wp-2018-37, World Institute for Development Economic Research (UNU-WIDER).
    10. Virgi Sari, 2018. "Educational assistance and education quality in Indonesia: The role of decentralization," WIDER Working Paper Series 037, World Institute for Development Economic Research (UNU-WIDER).
    11. Gershman, Boris & Rivera, Diego, 2018. "Subnational diversity in Sub-Saharan Africa: Insights from a new dataset," Journal of Development Economics, Elsevier, vol. 133(C), pages 231-263.
    12. Abman, Ryan, 2018. "Rule of Law and Avoided Deforestation from Protected Areas," Ecological Economics, Elsevier, vol. 146(C), pages 282-289.
    13. Samuel Bazzi & Matthew Gudgeon, "undated". "Local Government Proliferation, Diversity, and Conflict," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-271, Boston University - Department of Economics.
    14. Remi Jedwab & Adam Storeygard, 2019. "Economic and Political Factors in Infrastructure Investment: Evidence from Railroads and Roads in Africa 1960–2015," Economic History of Developing Regions, Taylor & Francis Journals, vol. 34(2), pages 156-208, May.
    15. Zhu, Junbing & Grigoriadis, Theocharis, 2020. "Chinese dialects, revolutionary war & economic performance," Discussion Papers 2020/7, Free University Berlin, School of Business & Economics.
    16. Bluhm, Richard & Thomsson, Kaj, 2020. "Holding on? Ethnic divisions, political institutions and the duration of economic declines," Journal of Development Economics, Elsevier, vol. 144(C).
    17. Abman, Ryan & Carney, Conor, 2020. "Agricultural productivity and deforestation: Evidence from input subsidies and ethnic favoritism in Malawi," Journal of Environmental Economics and Management, Elsevier, vol. 103(C).
    18. Gonschorek, Gerrit J. & Schulze, Günther G. & Sjahrir, Bambang Suharnoko, 2018. "To the ones in need or the ones you need? The political economy of central discretionary grants − empirical evidence from Indonesia," European Journal of Political Economy, Elsevier, vol. 54(C), pages 240-260.
    19. Sabyasachi Das & Abhiroop Mukhopadhyay & Rajas Saroy, 2018. "Does Affirmative Action in Politics Hinder Performance? Evidence from India," Working Papers 03, Ashoka University, Department of Economics.
    20. Toumbourou, Tessa, 2020. "Using a Delphi approach to identify the most efficacious interventions to improve Indonesia’s forest and land governance," Land Use Policy, Elsevier, vol. 99(C).
    21. Cisneros Tersitsch, Marco Elías & Kis-Katos, Krisztina & Nuryartono, Nunung, 2020. "Palm oil and the politics of deforestation in Indonesia," EFForTS Discussion Paper Series 31, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    22. GOMADO, Kwamivi Mawuli, 2018. "Diversité ethnique et déforestation dans les pays en développement: identification des principaux canaux [Ethnic diversity and deforestation in developing countries: identifying the transmission ch," MPRA Paper 89380, University Library of Munich, Germany.
    23. Edwards, Ryan B. & Naylor, Rosamond L. & Higgins, Matthew M. & Falcon, Walter P., 2020. "Causes of Indonesia’s forest fires," World Development, Elsevier, vol. 127(C).
    24. Arnim Langer & Frances Stewart & Maarten Schroyens, 2016. "Horizontal inequalities and affirmative action: An analysis of attitudes towards redistribution across groups in Africa," WIDER Working Paper Series 119, World Institute for Development Economic Research (UNU-WIDER).
    25. Leblois, Antoine & Damette, Olivier & Wolfersberger, Julien, 2017. "What has Driven Deforestation in Developing Countries Since the 2000s? Evidence from New Remote-Sensing Data," World Development, Elsevier, vol. 92(C), pages 82-102.

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    More about this item

    Keywords

    Deforestation; Ethnic Diversity; Corruption; Indonesia.;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H0 - Public Economics - - General
    • L73 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Forest Products

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