Stitching a Patchwork Quilt : Selection Institutions , Social Heterogeneity , and Development Outcomes

This paper investigates the manner in which the characteristics of selection institutions interact with country social context to produce development outcomes. Previous work has established that higher levels of social heterogeneity, ethnic fractionalization in particular, are associated with lower levels of public goods provision (Easterly and Levine, 1997; Alesina et al., 1999). Democracy tends to ameliorate these negative effects (Collier, 2000). Since democracy is a multidimensional concept, however, identifying which characteristics of democracy produce better development outcomes in diverse social contexts is important. This paper considers two such dimensions: contestation and inclusiveness (Dahl, 1971; Coppedge et al., 2008). Empirical tests using a cross-sectional dataset covering 104 countries indicate that political contestation matters more than inclusiveness for reducing rates of infant mortality in countries with high levels of ethnic diversity and economic inequality. Conversely, where levels of social heterogeneity are low, greater inclusiveness tends to reduce infant mortality. In recent years, empirical evidence has mounted that ethnic diversity adversely affects economic growth and a range of other development indicators (Easterly and Levine, 1997; Alesina et al., 1999; La Porta et al., 1999). Democracies, however, appear to be less susceptible to these negative effects on average. With respect to economic growth, Collier finds, “democracy massively reduces the problem posed by ethnic diversity” (2000: 233). Since democracy is a multidimensional concept, however, identifying which characteristics of democracy produce better development outcomes in diverse social contexts is important. In particular, does democracy ameliorate the effects of social heterogeneity when it expands the size of the selectorate, when it creates political contestation, or both? Much of the research concerning the effect of democracy on development outcomes overlooks the fact that democracy is a multi-dimensional in nature (Przeworski and Limongi, 1993; Barro, 1996; Lake and Baum, 2001; Baum and Lake, 2003; Ross, 2006). Dahl’s definition of polyarchy includes eight components, ranging from freedom of organization and expression to institutions that “make government policies depend on votes and other expressions of preference” (1971: 3). Yet, the typical proxy measures used in most empirical analysis, such as the Polity index, are a combination of several of these components. Although others construct a measure of democracy along a dimension such as contestation (Przeworski et al., 2000) or coalition size (Bueno de Mesquita et al., 2003), analysis of the interaction of different dimensions of democracy with social context is relatively unexplored.1 Drawing upon recent work from Coppedge et al. (2008), this paper considers the interaction of social heterogeneity with two important dimensions of democracy: contestation and inclusiveness. It finds that political contestation matters more than inclusiveness for reducing rates of infant mortality in countries with high levels of ethnic diversity and economic inequality. Conversely, where levels of social heterogeneity are low, greater inclusiveness tends to reduce infant mortality and contestation is less beneficial. The next section fleshes out the argument that focusing on individual dimensions of democracy is a necessary step, and it describes the dimensions of contestation and inclusiveness more fully. Section 2 looks at some of the literature on social heterogeneity and development, building the case that the effects of social heterogeneity interact with selection institutions. The next section uses a rudimentary model of selection institutions to generate two specific hypotheses, and these hypotheses are tested in Section 4. 1For one example, see Easterly et al. (2006).