Scholars have identified ethnic divisions as a leading cause of underdevelopment, due partially to their adverse effects on public goods. We investigate this issue in post-war Sierra Leone, one of the world's poorest and most ethnically diverse countries. To address concerns over endogenous local ethnic composition, we use an instrumental variables strategy using earlier census data on ethnicity and include several historical and geographic covariates. Perhaps surprisingly, we find that local diversity is not associated with worse public goods provision across multiple outcomes and specifications, with precisely estimated zeros. We investigate the role of historical factors in generating the findings.
ASJC Scopus subject areas
- Economics and Econometrics