This paper has three goals. The first, and perhaps the most important, is to provide a new compilation of data on ethnic, linguistic and religious composition at the sub-national level for a large number of countries. This data set allows us to measure segregation of different ethnic, religious and linguistic groups within the same country. The second goal is to correlate measures of segregation with measures of quality of the polity and policymaking. The third is to construct an instrument that helps to overcome the endogeneity problem which arises because groups move within country borders, partly in response to policies. We find that more ethnically and linguistically segregated countries, i.e., those where groups live more spatially separately, have a substantially lower quality of government. In contrast, we find no relationship between religious segregation and the quality of government. ∗ For editor and referees: this version of the paper is long because we wanted to be as clear as possible regarding the construction of the data set and the instrument to facilitate the editorial review. If needed the paper can be shortened and additional material can be made available on the web
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