National Identity and Public Goods Provision

  • Abstract:

    Nation building and creation of strong national identity is believed to have a positive influence on economic and political outcomes of the country and is proposed as a remedy for alleviating the adverse effect of ethnic fractionalization. However, empirical investigations showing the positive effect of strong national identity are still largely absent. The purpose of this paper is to find out the relationship between national identity and public goods provision for a wide cross-section of countries. The paper proposes theories examining the interplay between national identity and public goods provision, then shows empirically that the most nationalistic countries excel” in poor provision of public goods. It challenges the conventional wisdom on the role of national identity, suggesting that most of the cases it is used as a tool to divert the attention of citizens from most pressing issues such as provision of elementary public goods.