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Social fragmentation and economic growth: evidence from developing countries

Published online by Cambridge University Press:  21 June 2010

TADE O. OKEDIJI
TADE O. OKEDIJI*
Affiliation:
University of Minnesota, MinneapolisUSA
*
*Email: TOkediji@umn.edu
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Abstract:

This paper proposes a composite measure of ethnic fragmentation, the Social Diversity Index (SDI) to capture inherent multidimensionality not captured in the prevalent Ethno-Linguistic Fractionalization Index (ELF). The SDI more accurately demonstrates the direct effects of hidden diversity values and the extent and corresponding costs of ethnic diversity on economic growth. A comparative empirical analysis of the results from 132 countries employing the SDI and the ELF Index, suggests that the SDI is more robustly correlated with growth, and does a moderately better job of explaining the effect of exogenous static ethnic diversity. However, the empirical effects of ethnic diversity on growth tend to diminish with the inclusion of additional macroeconomic variables.

Type
Research Article
Information
Journal of Institutional Economics , Volume 7 , Issue 1 , March 2011 , pp. 77 - 104
Copyright
Copyright © The JOIE Foundation 2010

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