On the Dynamics of Ethnic Fractionalization

Nauro F. Campos () and Vitaliy Kuzeyev

No 6360, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Does fractionalization change over (short periods of) time? If so, are there any substantial implications for economic performance? To answer such questions, we construct a new panel data set with measures of fractionalization for 26 former communist countries covering the period from 1989 to 2002. Our fractionalization measures show that transition economies became more ethnically homogenous over such a short period of time, although the same did not happen in terms of linguistic and religious fractionalization. In line with the most recent literature, there seems to be no effect of (exogenous) fractionalization on macroeconomic performance (that is, on per capita GDP growth). However, we find that dynamic ethnic fractionalization is negatively related to growth (although this is still not the case for linguistic and religious fractionalization). These findings are robust to different specifications, polarization measures, instrument sets as well as to a composite index of ethnic-linguistic-religious fractionalization.

Keywords: ethnic fractionalization; growth; polarization; transition economies (search for similar items in EconPapers)
JEL-codes: H1 O11 O55 Z12 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr and nep-tra
Date: 2007-06
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