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Stability of Nations and Genetic Diversity

Listed author(s):
  • Klaus Desmet

    ()

    (Universidad Carlos III, Getafe (Madrid), Spain, and CEPR)

  • Michel Le Breton

    (Universite de Toulouse I, GREMAQ and IDEI, Toulouse, France)

  • Ignacio Ortuno-Ortin

    ()

    (Universidad Carlos III, Getafe (Madrid), Spain)

  • Shlomo Weber

    ()

    (Southern Methodist University, Dallas, USA, CORE, Catholic University of Louvain, Louvain-la-Neuve, Belgium, and CEPR)

This paper presents a model of nations where 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 or unification. We provide empirical support for choosing genetic distances as a proxy of cultural heterogeneity and by using data on genetic distances, we examine the stability of the current map of Europe. We then identify the regions prone to secession and the countries that are more likely to merge. Furthermore, we estimate the welfare gains from European Union membership.

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File URL: http://www.iset.ge/files/003-08.pdf
File Function: First version, 2008
Download Restriction: no

Paper provided by International School of Economics at TSU, Tbilisi, Republic of Georgia in its series Working Papers with number 003-08.

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Length: 34 pages
Date of creation: Jul 2008
Publication status: Published
Handle: RePEc:tbs:wpaper:08-003
Contact details of provider: Web page: http://www.iset.ge/

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