No one true path: uncovering the interplay between geography, institutions, and fractionalization in economic development
Article first published online: 18 JUN 2009
Copyright © 2009 John Wiley & Sons, Ltd.
Journal of Applied Econometrics
Volume 25, Issue 7, pages 1100–1127, November/December 2010
How to Cite
Tan, C. M. (2010), No one true path: uncovering the interplay between geography, institutions, and fractionalization in economic development. J. Appl. Econ., 25: 1100–1127. doi: 10.1002/jae.1102
- Issue published online: 18 JUN 2009
- Article first published online: 18 JUN 2009
Do institutions rule when explaining cross-country divergence? By employing regression tree analysis to uncover the existence and nature of multiple development clubs and growth regimes, this paper finds that to a large extent they do. However, the role of ethnic fractionalization cannot be dismissed. The findings suggest that sufficiently high-quality institutions may be necessary for the negative impact on development from high levels of ethnic fractionalization to be mitigated. Interestingly, I find no role for geographic factors—neither those associated with climate nor physical isolation—in explaining divergence. There is also no evidence to suggest a role for religious fractionalization. Copyright © 2009 John Wiley & Sons, Ltd.