Diversity of Communities and Economic Development: An Overview

This paper reviews the literature on the impact of ethnic diversity on economic development. Ethnically polarized societies are less likely to agree on the provision of public goods and more likely to engage in rent seeking activities providing lower levels of social capital. Initial conditions are important determinants of adverse development outcomes. The role of decentralization, democracy and markets as potential remedies are discussed. The paper then presents a number of preliminary hypotheses on the relationship between diversity and instability in order to stimulate future research.


Issue Date:
2011-09
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/115713
Total Pages:
20
JEL Codes:
O11; O40; O43; O55
Series Statement:
Economic Growth Center Discussion Paper
1001




 Record created 2017-04-01, last modified 2017-08-26

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