Working Paper: NBER ID: w18512
Authors: Alberto F. Alesina; Stelios Michalopoulos; Elias Papaioannou
Abstract: This study explores the consequences and origins of between-ethnicity economic inequality both across and within countries. First, combining satellite images of nighttime luminosity with the historical homelands of ethnolinguistic groups we construct measures of ethnic inequality for a large sample of countries and show that the latter is strongly inversely related to comparative development. Second, differences in geographic endowments across ethnic homelands explain a sizable portion of ethnic inequality contributing to its persistence over time. Third, exploiting across-district within-African countries variation using individual-level data on ethnic identification and well-being from the Afrobarometer Surveys we find that between ethnic-group inequality is systematically linked to regional under-development. In this sample we also explore the channels linking ethnic inequality to (under) development, finding that ethnic inequality maps to political inequality, heightened perceptions of discrimination and undersupply of public goods.
Keywords: Ethnic Inequality; Economic Development; Geographic Endowments; Public Goods; Political Inequality
JEL Codes: D63; O10; O40; O43; R12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Ethnic Inequality (J15) | real GDP per capita (O49) |
| Geographic endowments (R12) | Ethnic Inequality (J15) |
| Ethnic Inequality (J15) | Political Inequality (D72) |
| Ethnic Inequality (J15) | Public Goods Provision (H42) |
| Ethnic Inequality (J15) | Democratic Satisfaction (D72) |