Public goods and ethnic diversity: evidence from deforestation in Indonesia

Produced as part of the Evaluating the performance of climate policies CCCEP research programme theme

We show that the level of deforestation in Indonesia is positively correlated with the degree of ethnic fractionalization of the communities. We explore several channels that may link the two variables. They include the negative effect of ethnic fractionalization on the ability to coordinate and organize resistance against logging companies and a higher level of corruption of politicians less controlled in more fragmented communities.

Alberto Alesina, Caterina Gennaioli, and Stefania Lovo