Abstract. This paper identifies problems associated with the current empirical measurement of ethnic diversity in economic development literature. An expanded index of ethnic diversity is proposed to include variables such as religion and race, and the results are compared to the prevailing index utilized in empirical literature. The mean of the proposed index is significantly larger and the standard deviation is significantly smaller than that of the prevailing index. This would suggest that disparities in ethnic diversity among countries are not as wide as previously assumed. Further, these results confirm that a comprehensive and more accurate measure of ethnic diversity requires more than a linguistic measurement, which is the primary factor utilized in the prevailing index.