The Geography of Linguistic Diversity and the Provision of Public Goods

51 Pages Posted: 13 Jun 2018

See all articles by Klaus Desmet

Klaus Desmet

Southern Methodist University (SMU); Centre for Economic Policy Research (CEPR)

Joseph Gomes

University of Navarra

Ignacio Ortuno-Ortin

Universidad Carlos III de Madrid - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: June 2018

Abstract

This paper analyzes the importance of local interaction between individuals of different linguistic groups for the provision of public goods at the national level. The micro-founded conceptual framework we develop predicts that a country's public goods (i) decrease in its overall linguistic fractionalization, and (ii) either increase or decrease in its local learning multiplier, a measure of how local interaction affects antagonism towards other groups in the society at large. After constructing a 5 km by 5 km dataset on language use for 223 countries, we empirically explore these theoretical predictions. While overall fractionalization worsens public goods outcomes, we find a positive causal effect of local learning. Conditional on a country's overall diversity, public goods outcomes are maximized when there are a few large-sized groups and the diversity of each location mirrors that of the country as a whole. Our large-scale study, spanning the entire globe, confirms experimental micro-evidence in favor of contact theory.

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Suggested Citation

Desmet, Klaus and Gomes, Joseph and Ortuno-Ortin, Ignacio, The Geography of Linguistic Diversity and the Provision of Public Goods (June 2018). NBER Working Paper No. w24694. Available at SSRN: https://ssrn.com/abstract=3194741

Klaus Desmet (Contact Author)

Southern Methodist University (SMU) ( email )

6212 Bishop Blvd.
Dallas, TX 75275
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Joseph Gomes

University of Navarra ( email )

Camino del Cerro del Aguila, 3
Pamplona, Navarra 31080
Spain

Ignacio Ortuno-Ortin

Universidad Carlos III de Madrid - Department of Economics ( email )

Calle Madrid 126
Getafe, 28903
Spain

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