Public Goods and Ethnic Diversity: Evidence from Deforestation in Indonesia

35 Pages Posted: 20 Dec 2018

See all articles by Alberto Alesina

Alberto Alesina

Harvard University

Caterina Gennaioli

Queen Mary University, School of Business and Management

Stefania Lovo

University of Reading

Date Written: January 2019

Abstract

This paper shows that the level of deforestation in Indonesia is positively related to the degree of ethnic fractionalization. To identify a causal relation, we exploit the exogenous timing of variation in the level of ethnic heterogeneity due to the creation of new jurisdictions. We provide evidence consistent with a lower control of politicians, through electoral punishment, in more ethnically fragmented districts. Our results are consistent with the literature on (under)provision of public goods in ethnically diverse societies.

Suggested Citation

Alesina, Alberto and Gennaioli, Caterina and Lovo, Stefania, Public Goods and Ethnic Diversity: Evidence from Deforestation in Indonesia (January 2019). Economica, Vol. 86, Issue 341, pp. 32-66, 2019. Available at SSRN: https://ssrn.com/abstract=3304108 or http://dx.doi.org/10.1111/ecca.12285

Alberto Alesina (Contact Author)

Harvard University

1875 Cambridge Street
Cambridge, MA 02138
United States

Caterina Gennaioli

Queen Mary University, School of Business and Management ( email )

Mile End Road
London, London E1 4NS
Great Britain

HOME PAGE: http://www.busman.qmul.ac.uk/staff/gennaiolic.html

Stefania Lovo

University of Reading

Whiteknights
Reading, Berkshire RG6 6AH
United Kingdom

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