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Ethnic diversity, economic performance and civil wars

Author

Listed:
  • Valsecchi, Michele

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Abstract
We develop a conflict model linking dissipation to the distribution of the population over an arbitrary number of groups. We extend the pure contest version of the model by Esteban and Ray (1999) to include a mixed public-private good. We analyze how the level of dissipation changes as the population distribution and the share of publicness of the prize change. First, we find that, in case of pure private goods, the dissipation-distribution relationship resembles the fractionalization index. This may explain the sensitiveness of empirical evidence on the impact of ethnic diversity with respect to outcome (growth, incidence of civil wars) and index (fractionalization, discrete polarization). Second, we find that, in case of pure private goods, smaller groups always contribute more and so the fractionalization index under-estimates their weight. Indeed, we find that the fractionalization index under-estimates the true level of dissipation.

Suggested Citation

  • Valsecchi, Michele, 2010. "Ethnic diversity, economic performance and civil wars," Working Papers in Economics 433, University of Gothenburg, Department of Economics.
    • Handle: RePEc:hhs:gunwpe:0433
    as

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    File URL: http://hdl.handle.net/2077/22040
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    References listed on IDEAS

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    Cited by:

    1. Olsson, Ola & Valsecchi, Michele, 2010. "Quantifying Ethnic Cleansing: An Application to Darfur," Working Papers in Economics 479, University of Gothenburg, Department of Economics.

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    More about this item

    Keywords

    ethnic diversity; public-private goods; polarization; fractionalization;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods

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