TY  - JOUR
AU  - Alesina,Alberto
AU  - Baqir,Reza
AU  - Easterly,William
TI  - Public Goods and Ethnic Divisions
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6009
PY  - 1997
Y2  - April 1997
UR  - http://www.nber.org/papers/w6009
L1  - http://www.nber.org/papers/w6009.pdf
N1  - Author contact info:
Alberto F. Alesina
Department of Economics
Harvard University
Littauer Center 210
Cambridge, MA 02138
Tel: 617/495-8388
Fax: 617/495-7730
E-Mail: aalesina@harvard.edu

William Easterly
New York University
Department of Economics
19 W. 4th Street, 6th floor
New York NY 10012
Tel: 212/992-8684
Fax: 212/995-4186
E-Mail: william.easterly@nyu.edu
AB  - We present a model that links heterogeneity of preferences across ethnic groups in a city to the amount and type of public good the city supplies.  We test the implications of the model with three related datasets: US cities, US metropolitan areas, and US urban counties. Results show that productive public goods -- education, roads, libraries, sewers and trash pickup -- in US cities (metro areas/urban counties) are inversely related to the city's (metro area's/county's) ethnic fragmentation, even after controlling for other socioeconomic and demographic determinants.  Ethnic fragmentation is negatively related to the share of local spending on welfare.  The results are mainly driven by observations in which majority whites are reacting to varying sizes of minority groups.  We conclude that ethnic conflict is an important determinant of local public finances.
ER  -