Revisiting Easterly and Levine (1997): Replication and extension

Mark Millrine and Sunčica Vujić ()

Working Papers from University of Antwerp, Faculty of Business and Economics

Abstract: We replicate and extend the findings from Easterly and Levine (1997) arguing that ethnolinguistic fractionalization is negatively associated with several development indicators. We re-estimate the authors’ original regressions and control for several determinants of development which are correlated with ethnolinguistic fractionalization: a country’s level of partitioning (proportion of the population who belong to ethnic groups split by borders), its colonial history (whether it was formerly a colony) and regional effects (whether it is located in Africa or Latin America). In contrast with Easterly and Levine (1997), we find no evidence that ethnolinguistic fractionalization is associated with any of the development indicators. Rather, for each development indicator where, in comparison with Easterly and Levine (1997), ethnolinguistic fractionalization loses its statistical significance, we find that one of our control variables is statistically significant and takes the expected sign given the correlation between ethnolinguistic fractionalization and the control variable. Our results therefore raise the possibility that the original estimates from Easterly and Levine (1997) suffer from omitted variable bias in that they misattribute the effect of partitioning, colonial history and regional effects to the level of ethnolinguistic fractionalization.

Keywords: Economic development; Public policy; Ethnic diversity (search for similar items in EconPapers)
JEL-codes: J15 J18 Z13 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2017-07
New Economics Papers: this item is included in nep-evo
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Persistent link: https://EconPapers.repec.org/RePEc:ant:wpaper:2017007

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