Ethnic Favoritism: An Axiom of Politics?

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This paper investigates the existence of ethnic favoritism, i.e. preferential public policies targeting the ethnic group of the political leaders. It relies on a sample of 141 countries covering all continents and regions of the world, and it employs nighttime light intensity as output measure to captures the aggregate distributive effect of many different policies. We study whether regions inhabited by the political leader's ethnic group experience a differential growth in nighttime intensity during their co-ethnic leader's office. We find robust evidence in favor of ethnic favoritism: leader's ethnic group regions enjoy a nighttime light growth of about 10 percent. We find evidence of ethnic favoritism in Africa, Asia and Latin America. Exploring the heterogeneity of the impact, we learn that ethnic favoritism is more likely in less democratic, but longer established, polities, and in more ethnically segregated societies.