Diversity of Communities and Economic Development: An Overview

17 Pages Posted: 22 Sep 2009

See all articles by Gustav Ranis

Gustav Ranis

Yale University - Department of Economics (Deceased)

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Date Written: September 18, 2009


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.

Keywords: Africa, diversity, economic growth, instability

JEL Classification: O11, O40, O43, O55

Suggested Citation

Ranis, Gustav, Diversity of Communities and Economic Development: An Overview (September 18, 2009). Yale Economics Department Working Paper No. 69, Yale University Economic Growth Center Discussion Paper No. 977, Available at SSRN: https://ssrn.com/abstract=1475329 or http://dx.doi.org/10.2139/ssrn.1475329

Gustav Ranis (Contact Author)

Yale University - Department of Economics (Deceased)

United States

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