Ethnic conflict, power dynamics and growth

Pierre Pecher

No 2014008, LIDAM Discussion Papers IRES from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: I construct a successive generations model of appropriative competition between ethnicities where de facto power puts an upper-bound on the consumption of each clan. My aim is to derive the implications of the structure of the ethnic and political divisions in terms of economic prosperity. I expose a mechanism reducing negative externalities in consumption implying that long-run economic growth is larger when influence is concentrated rather than dispersed. I find that competition intensity sometimes is beneficial if it is above a thresh-old or if small groups initially have a large influence. I provide an argument in favour of the Ethno-Linguistic Fractionalization index over a polarization index when considering the impact of diversity on growth. This paper fills a gap in the literature by allowing for the possibility of more than two groups of different sizes in a dynamical setup and by being consistent with the evidence of proportionality between ethnic and political share sin sub-Saharan Africa.

Keywords: Economic performance; de facto power dynamics; diversity; ethnic struc-ture; appropriative competition (search for similar items in EconPapers)
JEL-codes: E21 O43 P48 (search for similar items in EconPapers)
Pages: 31
Date: 2013-12-21
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:2014008

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