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Public goods and ethnic diversity: evidence from deforestation in Indonesia

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  • Alesina, Alberto
  • Gennaioli, Caterina
  • Lovo, Stefania

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 & Gennaioli, Caterina & Lovo, Stefania, 2019. "Public goods and ethnic diversity: evidence from deforestation in Indonesia," LSE Research Online Documents on Economics 90257, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:90257
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    More about this item

    Keywords

    deforestation; ethnic diversity; corruption; Indonesia;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • L73 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Forest Products
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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