Road to Division: Ethnic Favouritism in the Provision of Road Infrastructure in Ethiopia

Ethnic favouritism has long been considered by scholars as intrinsic in explaining sub-optimal economic growth in African countries. Our case study, Ethiopia, represents an unicum in the African political context, as ethnicity has been institutionalised as the key element of the post-authoritarian state order, yielding a system that has been labelled “ethnic federalism†. This paper aims to analyse whether this particular institutional setting has proven to be a deterrent to logics of ethnic favouritism in the allocation of public goods. In order to do so, the study exploits a national scale road investment project spanning almost twenty years, the Ethiopian Road Sector Development Programme. We seek to assess whether the politically dominant ethnicity, Tigrays, have benefitted disproportionately from the project with respect to other ethnically identified Ethiopian regions. By exploiting a novel dataset containing spatially explicit information on the location of new road constructions and road surface im- provements, we leverage quasi-experimental econometric methods in order to identify a causal effect of coethnicity with the Tigray People’s Liberation Front, the dominant component of the Ethiopian People’s Revolutionary Democratic Front, in the reception of new road construction and road improvements. The main contribution of this paper resides in the quantification of the disproportional allocation of road investments. We find that ethnic Tigrays obtain on average 5-7% more roads with respect to other ethnic groups, once pre-treatment characteristics are balanced across treatment and control units. Moreover, the result is consistent when ex- pressed in terms of road improvements, with road speed on Tigray territories increasing by an additional 10 km/h with respect to non-Tigray observations. These results may be considered as evidence of ethnically unbalanced economic growth inside the Ethiopian territory.