Séminaire d’Automatique du plateau de Saclay : What drives the quality of local public goods in Africa? Disentangling social capital and ethnic divisions

Séminaire le 24 Janvier 2017, 11h00 à CentraleSupelec (Gif-sur-Yvette) Salle du conseil du L2S - B4.40
Guillaume Hollard (Département d’Economie, Ecole polytechnique)

Two important lines of research shaped our understanding of the ability of communities to engage in collective action. The first line proposes ethnic division as a key determinant, with more ethnically heterogeneous countries having lower economic performances and levels of public goods. Thus, we expect to find better schools where ethnic fractionalization is low. The second line of research focuses on social capital as a major determinant of the ability to engage in collective action.We expect that trust among community members, a widely-used measure of social capital, is an important and positive determinant of school quality. The present work aims to disentangle the relative effects of ethnic fractionalization and social capital on school quality. We use instrumental variable estimations to address reverse causality and other endogeneity issues. We instrument both social capital and ethnic fractionalization by using historical information on the settlement patterns of ethnic groups in Sub-Saharan Africa. Our empirical strategy is implemented by combining four datasets, including Afrobarometer, covering 16 Sub-Saharan countries. We run our analysis at the district level, with more than 1000 districts covered. We find an important and positive effect of trust on the practical aspects of schooling, such as maintaining buildings or providing textbooks. A one percent increase in the level of trust increases the quality of local public goods by 0.18 to 1.05 percent, depending on the measure of school quality under consideration. In sharp contrast, ethnic fractionalization is found to have a very limited effect, if any. We propose a simple model of public good provision that explores a channel by which social capital and ethnic division may (or may not) have an impact on the provision of local public goods such as schools. Our results suggest that policies designed to enhance social capital are likely to have a positive effect on schools and local public goods in general.

Bio. Directeur de recherche au CNRS et professeur associé à l'école polytechnique. Spécialisé dans l'analyse de la décision et du comportement. Responsable du laboratoire d'économie expérimentale.