ETHNIC DIVERSITY AND HUMAN DEVELOPMENT: AN EMPIRICAL ANALYSIS OF NEPAL

TRILOCHAN POKHAREL

Outline of Presentation

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Theoretical Discussion of Ethnic Diversity and Development

Methodological Development - Measuring Ethnic Diversity

Ethnic Diversity in Nepal- Findings of New Measurement

Ethnic Diversity and Human Development

Methodological issues of Measurement

Inferential Results

Conclusion

What is ethnic diversity?

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Ethnic diversity exists when a number of people representing different cultures, beliefs, social structure and norms, and sometimes languages and religious identity live together in a defined territory.

Ethnicity formation is classically based on two approaches - instrumental (material deprivation) and symbolic (anxiety to preserve cultural identity).

In extreme situations, the two strands of ethnicity can combine and serve as a motive force for state formation.

Ethnicity and Development

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In multi-ethnic societies, ethnicity is an additional variable in socio-economic development against homogenous societies.

Economic consequences of ethnic heterogeneity has discovered both positive and negative implications.

Ethnic diversity can be a problem or a potentially rewarding, but the negative aspects have been more publicised or researched against the positive aspects.

Occasional violent ethnic conflicts have received far greater attention than years of peace in multi-ethnic and multi-cultural societies.

Contd…

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If the ethnic classification is dictated, avoiding individual's choice to nominate oneself in particular ethnic identity, is likely to upsurge ethnic conflict resulting a negative impact on development.

Measuring Ethnic Diversity

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There are two popular practices of measuring ethnic diversity.

1. Gibbs and Matrin (1962) – Index of ethnic diversification

2. Taylor and Hudson (1972) - Ethnic fractionalization

Note: Both of these are unidimensional.

Proposed new methodology…

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UNDP's 0 to 1 scaling transformation method is used to normalize the value.

Higher the number of ethnic groups having population proportion more than 1 %, better is the diversity.

Therefore, fractionalization index is directly proportional to diversity.

In contrast, larger the difference between first two ethnic groups, poorer is the diversity.

Hence, distribution index is inversely proportional to diversity.

Selection of maxima and minima

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The observed maxima and minima of the spatial unit have been used to normalize the values.

Human Development Reports have practiced this process until 1994.

Three reasons First, ethnic composition is unlikely to be predicted.

Second, time series data in ethnicity are unavailable.

Third, in case, available data are not comparable due to inconsistent ethno-demographic classification.

For example, the national census of Nepal 1991 census provides data on 59 ethnic groups whereas the 2001 census provides data on 100 ethnic groups- comparability problem.

Calculating diverity

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Fractionalization index

Where, Fj is the normalized value for ethnic fractionalization for jth specified unit of place (in this case district), Xfj is the observed value for ethnic fractionalization (F) for jth specified unit of place (district) and Xf(max) and Xf(min) are maximum and minimum values for ethnic fractionalization (F).

(min)(max)

(min)

ff

ffjj XX

XXF

Contd…

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Distribution index

where the terms have usual meaning, except d represents the distribution indicator

(min)(max)

(max)

dd

djdj XX

XXD

Contd…

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Finally, the ethnic diversity is derived as unweighted average of Fractionalization Index (Fj) and Distribution Index (Dj) as

Where,EDIj is the ethnic diversity index for jth specified unit

of place (district). The value of EDI ranges from 0 to 1, '0' when both indicators Fj and Dj take '0' and '1' when both take 1 respectively.

jjj DFEDI 21

Data

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Population Census of Nepal 2001 provides data on ethnic composition for 75 districts which has been used for calculating ethnic diversity index (EDI). For calculation of EDI, ethnic groups having population

1 per cent or more are only included.

Human Development Index (HDI) calculated by UNDP (2004) corresponding to year 2001 is used as a measure of development.

Results

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Extent of ethnic diversity Figure 1: Ethnic fractionalization and distribution

Districts by Ethnic Diversity

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Methodological issues……….

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Considering the probability of variation in the EDI and HDI, a weight is given by population proportion of each district with the national population.

Therefore, wEDI and wHDI are calculated giving weights to EDI and HDI by population proportion that each district holds according to Population Census 2001.

Considering the total national population is unity, the weights are derived converting the percentage into proportion.

The wEDI and wHDI seem to be more invariable compared to original EDI and HID value in response to population size.

Scatter diagram: Ethnic Diversity and Human Development

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Regression Result

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Regression model Std. Error t Sig.(Constant) 0.002 0.000 4.972 .000wEDI 0.479 0.033 16.377 .000R2 0.852 .000

Conclusion

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Disproving the arguments that ethnic diversity is not positive to development the findings show the strong positive relationship.

Ethnic diversity is negatively elaborated through some myths – ethnic groups are prone to violent conflict,

cultural liberties involve defending traditional practices,

ethnically diverse communities are less able to develop,

cultures have differential values and ability to thrive development.

Contd…

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The reality is that persistence inequality, discrimination and systematic social, economic and political exclusion are the major reasons that destroy ethnic harmony and turn society into violent activities.

The positive relationship of ethnic diversity and development in Nepal may be attributed to the unique characteristic of ethnic composition of Nepal than elsewhere,

the cultural and ethnic tolerance,

the social mobility that has positive influence with development and

the social capital is often modelled by ethnic diversity.

Contd…

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Finally, The process how the ethnic diversity promotes or can

be utilized to promote development is yet to be researched.

Nepali population has become ethnically more aware than ever before, this is the right time to make the development process and plans ethnic friendly, before ethnic diversity turns to be problematic.

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Thank you for your kind attention.