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Nation formation and genetic diversity

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  • DESMET, Klaus
  • LE BRETON, Michel
  • ORTUNO-ORTIN, Ignacio
  • WEBER, Shlomo

Abstract

This paper presents a model of nation formation in which culturally heterogeneous agents vote on the optimal level of public spending. Larger nations benefit from increasing returns in the provision of public goods, but bear the costs of greater cultural heterogeneity. This tradeoff induces agents? preferences over different geographical configurations, thus determining the likelihood of secession and unification. We provide empirical support for choosing genetic distances as a proxy of cultural heterogeneity. By using data on genetic distances, we examine the stability of the current map of Europe and identify the regions prone to secession and the countries that are more likely to merge. Our framework is further applied to estimate the welfare gains from European Union membership.

Suggested Citation

  • DESMET, Klaus & LE BRETON, Michel & ORTUNO-ORTIN, Ignacio & WEBER, Shlomo, 2006. "Nation formation and genetic diversity," CORE Discussion Papers 2006095, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvco:2006095
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    References listed on IDEAS

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    Cited by:

    1. Enrico Spolaore & Romain Wacziarg, 2016. "War and Relatedness," The Review of Economics and Statistics, MIT Press, vol. 98(5), pages 925-939, December.
    2. repec:eee:deveco:v:127:y:2017:i:c:p:449-458 is not listed on IDEAS
    3. Quamrul Ashraf & Oded Galor, 2013. "The 'Out of Africa' Hypothesis, Human Genetic Diversity, and Comparative Economic Development," American Economic Review, American Economic Association, vol. 103(1), pages 1-46, February.
    4. Maystre, Nicolas & Olivier, Jacques & Thoenig, Mathias & Verdier, Thierry, 2014. "Product-based cultural change: Is the village global?," Journal of International Economics, Elsevier, vol. 92(2), pages 212-230.
    5. Enrico Spolaore, 2009. "National Borders, Conflict and Peace," CESifo Working Paper Series 2860, CESifo Group Munich.
    6. Maria Cubel, 2010. "Fiscal equalization and political conflict," Working Papers 2010/9, Institut d'Economia de Barcelona (IEB).
    7. Collado, M. Dolores & Ortuño Ortin, Ignacio & Romeu, Andrés, 2008. "Vertical Transmission of Consumption Behavior and the Distribution of Surnames," UMUFAE Economics Working Papers 2651, DIGITUM. Universidad de Murcia.
    8. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2009. "Cultural Biases in Economic Exchange?," The Quarterly Journal of Economics, Oxford University Press, vol. 124(3), pages 1095-1131.
    9. Ashraf, Quamrul & Galor, Oded, 2008. "Human Genetic Diversity and Comparative Economic Development," CEPR Discussion Papers 6824, C.E.P.R. Discussion Papers.
    10. Kyle L. Marquardt & Yoshiko M. Herrera, 2015. "Ethnicity as a Variable: An Assessment of Measures and Data Sets of Ethnicity and Related Identities," Social Science Quarterly, Southwestern Social Science Association, vol. 96(3), pages 689-716, September.
    11. Elisenda Paluzie, 2010. "The Costs and Benefits of Staying Together: The Catalan Case in Spain," Chapters,in: The Political Economy of Inter-Regional Fiscal Flows, chapter 14 Edward Elgar Publishing.
    12. Dimitrov, Dinko & Lazarova, Emiliya, 2011. "Two-sided coalitional matchings," Mathematical Social Sciences, Elsevier, vol. 62(1), pages 46-54, July.

    More about this item

    Keywords

    nation formation; genetic diversity; cultural heterogeneity; secession; unification; European Union;

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • H40 - Public Economics - - Publicly Provided Goods - - - General

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