Constructing Ethnic Fractionalization Indices

In recent years, ethnic fractionalization has emerged as a central variable in quantitative analyses of outcomes ranging from economic growth rates (Easterly and Levine, 1997) and the quality of governance (La Porta et al, 1999) to ethnic conflict (Kay et al, 2000) and the frequency of coups d’etat (Londregan and Poole, 1990). Almost all such analyses employ, either alone or in combination with other measures, the same measure of ethnic fractionalization. This index, called ELF (for Ethno-Linguistic Fractionalization), is available for 129 countries – indeed, its broad coverage is the principal reason for its widespread adoption – and reflects the likelihood that two people chosen at random will be from different ethnic groups. It is calculated using the Herfindahl concentration formula from data compiled in a global survey of ethnic groups published in the Atlas Narodov Mira (1964) and subsequently included in Taylor and Hudson (1972).