The Ethnic Question in Law and Development

Abstract

Below is an abstract of my review of Professor Amy Chua's book.

Professor Amy Chua's excellent book, World on Fire, contains significant observations about the current law and development project, specifically its ignorance of seething divisions that exist in many developing countries between market-dominant ethnic minorities - such as the Chinese and Indians in Malaysia or the Jews in Russia - and the impoverished ethnic majorities. Professor Chua's arguments are complex and cannot be boiled down to a mere one- or two-line description. But it is fair to say that she favors establishing governmental "affirmative action" to alleviate the economic conditions of the ethnic majority - to favor the ethnic majority and restrain the (market-dominant) ethnic minority.

I critique this proposal and reject, either as a strategic or normative matter, discrimination against a group on the basis of its ethnicity. If members of the group are economically dominant because of corrupt reasons, then anti-corruption laws should be applicable. In other cases, I propose two remedies.

The first centers on the possibility of "culture change," that is, exploring whether certain cultural attributes of the ethnic majority impedes economic development and addressing ways to transform such attributes. To support this argument, I build upon existing norm change literature. I also rely particularly on the Japanese experience, especially in the late 1800s - to embark consciously upon culture change - in order to address the technological superiority of the West.

The second centers on the application of antitrust or competition laws to break up conglomerates and monopolies and outlaw predatory practices that may entrench the economic dominance of the market-dominant ethnic minority. This application would be done in an ethnically neutral manner, although the result would be to break up ethnic market dominance.

Keywords: Ethnicity, Law and Development

JEL Classification: L12, L13, L40, L41, L42, Z10, J71, D42, D42