Ethnic fractionalization and income inequality: the case of Kazakhstan

Abstract

Ethnic diversity has an impact on many areas of social life, which has led to an extensive layer of research on relationships in this area. Many authors have studied in detail the impact of ethnic diversity on conflicts, instability, domestic politics, other various social and cultural aspects. At the same time, the relationship between ethnic fractionalization and economic parameters remains insufficiently studied, which leaves a wide field for relevant research, especially at the level of individual countries, since most of the work is devoted to cross-country comparative analysis of the relevant parameters. One of the most actual problems in the context of ethnic heterogeneity is its relationship with income inequality. This article presents the results of a study of the relationship between ethnic diversity, estimated on the basis of the ethno-linguistic fractionalization (ELF) index, and two indicators of income inequality — the Gini coefficient and the inter-decile income share ratio (S90/S10). The analysis of this relationship was carried out on the example of one country — Kazakhstan — by comparing the corresponding indicators for seventeen regions. The results of the analysis showed the presence of a stable and noticeable relationship, expressed in the growth of income inequality as ethnic diversity grows in the regions of the country. It was revealed that in the most ethnically homogeneous regions, income inequality indicators are minimal, while in the most ethnically diverse regions they are much higher. A significant correlation was also found between ethnic fractionalization and indicators of income inequality. The results obtained are generally correspond to the results of a number of cross-country studies, but in the case of Kazakhstan they are more distinct, which can be interpreted as confirmation of the relationship between ethnic diversity and income inequality in general.