DP14170 The Employment Effects of Ethnic Politics

Author(s):	Francesco Amodio, Giorgio Chiovelli, Sebastian Hohmann
Publication Date:	December 2019
Date Revised:	June 2020
Keyword(s):	Africa, democracy, employment, ethnic politics, traditional leaders
JEL(s):	J15, J70, O10, P26, Q15
Programme Areas:	Labour Economics, Development Economics
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=14170

This paper studies the labor market consequences of ethnic politics in African democracies. We combine geo-referenced data from 15 countries, 32 parliamentary elections, 62 political parties, 243 ethnic groups, 2,200 electoral constituencies, and 400,000 individuals. We implement a regression discontinuity design that compares individuals from ethnicities connected to parties at the margin of electing a local representative in the national parliament. We find that having a local ethnic party politician in parliament increases the likelihood of being employed by 2-3 percentage points. We argue that this effect results from strategic interactions between politicians and traditional leaders, the latter being empowered to allocate land and agricultural jobs in exchange for votes. The available evidence supports this hypothesis. First, the employment effect is concentrated in the historical homelands of ethnicities with strong pre-colonial institutions. Second, individuals from ethnicities linked to the winning party are more likely to be employed in agriculture, and in those countries where traditional leaders are not recognized by national legislation. Third, they are also more likely to identify traditional leaders as partisan, and mainly responsible for the allocation of land. Evidence shows that ethnic politics shapes the distribution of productive resources between individuals, ethnic groups and economic sectors.