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Economic versus Cultural Differences: Forms of Ethnic Diversity and Public Goods Provision

  • KATE BALDWIN (a1) and JOHN D. HUBER (a2)

Arguments about how ethnic diversity affects governance typically posit that groups differ from each other in substantively important ways and that these differences make effective governance more difficult. But existing cross-national empirical tests typically use measures of ethnolinguistic fractionalization (ELF) that have no information about substantive differences between groups. This article examines two important ways that groups differ from each other—culturally and economically—and assesses how such differences affect public goods provision. Across 46 countries, the analysis compares existing measures of cultural differences with a new measure that captures economic differences between groups: between-group inequality (BGI). We show that ELF, cultural fractionalization (CF), and BGI measure different things, and that the choice between them has an important impact on our understanding of which countries are most ethnically diverse. Furthermore, empirical tests reveal that BGI has a large, robust, and negative relationship with public goods provision, whereas CF, ELF, and overall inequality do not.

Corresponding author
Kate Baldwin is Assistant Professor, Department of Political Science, University of Florida, and Visiting Research Scholar, Center for the Study of Democratic Politics, Princeton University, 308A Robertson Hall, Princeton, NJ 08544 (
John D. Huber is Professor, Department of Political Science, Columbia University, 732 International Affairs Building, 420 W. 118th Street, New York, NY 10027 (
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American Political Science Review
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