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Ethnic polarization, potential conflict and civil wars

This paper analyzes the relationship between ethnic fractionalization, polarization, and conflict. In recent years many authors have found empirical evidence that ethnic fractionalization has a negative effect on growth. One mechanism that can explain this nexus is the effect of ethnic heterogeneity on rent-seeking activities and the increase in potential conflict, which is negative for investment. However the empirical evidence supporting the effect of ethnic fractionalization on the incidence of civil conflicts is very weak. Although ethnic fractionalization may be important for growth, we argue that the channel is not through an increase in potential ethnic conflict. We discuss the appropriateness of indices of polarization to capture conflictive dimensions. We develop a new measure of ethnic heterogeneity that satisfies the basic properties associated with the concept of polarization. The empirical section shows that this index of ethnic polarization is a significant variable in the explanation of the incidence of civil wars. This result is robust to the presence of other indicators of ethnic heterogeneity, other sources of data for the construction of the index, and other data structures.

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Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 770.

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Date of creation: Jul 2004
Date of revision: Mar 2005
Handle: RePEc:upf:upfgen:770
Contact details of provider: Web page: http://www.econ.upf.edu/

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  1. Alesina, Alberto, et al, 2003. " Fractionalization," Journal of Economic Growth, Springer, vol. 8(2), pages 155-94, June.
  2. Paul Collier & Anke Hoeffler, 2004. "Greed and Grievance in Civil War," Development and Comp Systems 0409007, EconWPA.
  3. Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers 536, Harvard - Institute for International Development.
  4. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 1999. "The Quality of Government," Journal of Law, Economics and Organization, Oxford University Press, vol. 15(1), pages 222-79, April.
  5. Jean-Yves Duclos & Joan Esteban & Debraj Ray, 2004. "Polarization: Concepts, Measurement, Estimation," Econometrica, Econometric Society, vol. 72(6), pages 1737-1772, November.
  6. Paul Collier, 2001. "Implications of ethnic diversity," Economic Policy, CEPR;CES;MSH, vol. 16(32), pages 127-166, 04.
  7. Islam, Nazrul, 1995. "Growth Empirics: A Panel Data Approach," The Quarterly Journal of Economics, MIT Press, vol. 110(4), pages 1127-70, November.
  8. Edward Miguel & Shanker Satyanath & Ernest Sergenti, 2004. "Economic Shocks and Civil Conflict: An Instrumental Variables Approach," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 725-753, August.
  9. Herschel I. Grossman, 2001. "The Creation of Effective Property Rights," American Economic Review, American Economic Association, vol. 91(2), pages 347-352, May.
  10. Esteban, J. & Ray, D., 1993. "On the Measurement of Polarization," UFAE and IAE Working Papers 221.93, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  11. Keefer, Philip & Knack, Stephen, 2000. "Polarization, politics, and property rights : links between inequality and growth," Policy Research Working Paper Series 2418, The World Bank.
  12. Skaperdas, Stergios, 1992. "Cooperation, Conflict, and Power in the Absence of Property Rights," American Economic Review, American Economic Association, vol. 82(4), pages 720-39, September.
  13. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  14. Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
  15. Fearon, James D, 2003. " Ethnic and Cultural Diversity by Country," Journal of Economic Growth, Springer, vol. 8(2), pages 195-222, June.
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