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Nation formation and genetic diversity

Klaus Desmet (), Michel Le Breton, Ignacio Ortuno-Ortin and Shlomo Weber
Authors registered in the RePEc Author Service: Ignacio Ortuno Ortin

No 2006095, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: This paper presents a model of nation formation in which culturally heterogeneous agents vote on the optimal level of public spending. Larger nations benefit from increasing returns in the provision of public goods, but bear the costs of greater cultural heterogeneity. This tradeoff induces agents? preferences over different geographical configurations, thus determining the likelihood of secession and unification. We provide empirical support for choosing genetic distances as a proxy of cultural heterogeneity. By using data on genetic distances, we examine the stability of the current map of Europe and identify the regions prone to secession and the countries that are more likely to merge. Our framework is further applied to estimate the welfare gains from European Union membership.

Keywords: nation formation; genetic diversity; cultural heterogeneity; secession; unification; European Union (search for similar items in EconPapers)
JEL-codes: H77 D70 F02 H40 (search for similar items in EconPapers)
Date: 2006-10
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