Linguistic Diversity and Redistribution Articles uri icon

publication date

  • December 2009

start page

  • 1291

end page

  • 1318

issue

  • 6

volume

  • 7

international standard serial number (ISSN)

  • 1542-4766

electronic international standard serial number (EISSN)

  • 1542-4774

abstract

  • This paper investigates the effect of linguistic diversity on redistribution in a broad cross-section of countries. We use the notion of "linguistic distances" and show that the commonly used fractionalization index, which ignores linguistic distances, yields insignificant results. However, once distances between languages are accounted for, linguistic diversity has both a statistically and economically significant effect on redistribution. With an average level of redistribution of 9.5% of GDP in our data set, an increase byone standard deviation in the degree of diversity lowers redistribution by approximately one percentage point. We also demonstrate that other measures, such as polarization and peripheral heterogeneity, provide similar results when linguistic distances are incorporated. (JEL: D6, D74, H5, Z10)