Jack Mintz: Actually, evidence shows ‘diversity’ makes countries weaker — not stronger

Maxime Bernier ignited his latest political firestorm when he used his Twitter account to criticize the “cult of diversity” perpetually promoted by the federal Liberals. If he had a valid point in there somewhere it was not helped by his unfair comments about “people who refuse to integrate into our society and want to live apart in their ghetto” that “don’t make our society strong.”

Most immigrants coming to Canada want to build a new life in a free and democratic society, escaping tyranny, prejudice or poor economic circumstances. Their local ethnic communities help them get adjusted to their new home. But it is nonetheless true that Canada faces a real test in maintaining national identity when so many people come from disparate backgrounds, and in avoiding problems that occur with ethnic conflict.

In principle, diverse populations can be economically rewarding. They provide more product and service choices. Immigration brings workers with a greater variety of backgrounds. Immigrants can even spur more innovation since people with different perspectives combine ideas in ways that would not happen with homogenous societies.

However, the flipside is fragmentation — when citizens identify more strongly with a social group rather than the nation as a whole, potentially leading to conflict. Conflict itself erodes trust in institutions and encourages corruption.

Canada is among the most ethnically diverse, or fragmented, countries in the world (see accompanying table). Only Sub-Saharan African countries and some Latin American countries are more so. This fragmentation impacts voting behaviour. It can also bring civil strife.

Social scientists have noted how puzzling it is that at times people vote against their own evident economic interests. Poor people might sometimes vote for less wealth redistribution, and rich people for more. One thing that helps explain this is the concept of social identity: grouping people according to income, ethnic background, religion and language. National identity is one form of it.

What researchers have found is that voters who identify more strongly with the “nation” rather than their particular sub-group, are more cognizant of the country’s overall well-being. This has been supported by recent empirical studies looking at OECD countries and Belgium.

Social-identity theory has also led researchers to examine more carefully the impact of fragmentation on economic growth, quality of government institutions, centralization of political decision-making and conflict. Harvard political economist Alberto Alesina and his colleagues have painstakingly measured ethnic, religious and linguistic diversification for roughly 200 countries in the past two decades. Overall, the most fragmented societies were found to have lower growth in per capita GDP and poorer quality public institutions: fewer years of schooling, worse infrastructure, higher fiscal deficits, lower credit liquidity and higher black-market premiums.

There is no evidence that ethnic and linguistic fragmentation leads to higher growth

According to Alesina et al.’s estimates, if Canada’s ethnic fragmentation was as low as in the U.S., we would have 0.4 percentage points more in annual growth in per capita GDP. In 40 years, this would translate into an additional US$800 billion in annual GDP.

When ethnically fragmented populations are associated with high degree of income inequality, the risk of social conflict grows. Since inequality is less severe in Canada, we avoid the conflicts of Nigeria and Bolivia.

Fragmentation also impacts governance. Ethnically fragmented populations tend to have more party proliferation, especially under proportional representation. Voters gravitate to parties to which they identify culturally or socially, not just on the basis of national issues. First-past-the-post voting in countries like Canada and the U.S. reduces party proliferation in fragmented countries. (Certainly not many people have given Bernier’s new breakaway political movement much chance of going far.)

It’s wise not to overplay these conclusions since fragmentation is highly linked with other factors as well (particularly, distance from the equator). Legal history also matters. What is critical to note, though, is that there is no evidence to support the political hypothesis that ethnic and linguistic fragmentation — a.k.a. “diversity” — leads to higher growth. Only religious fragmentation has been correlated with improved growth.

However, fragmented societies with weak national identification often result in citizens identifying more with their regions — which are typically less fragmented — rather than the greater nation. When this happens in Canada, voters prefer when provinces redistribute income rather than the federal government.

Yet even though Canada is much more ethnically fragmented than other large countries, we’ve avoided the pitfalls of low growth and poor governance structures. Our legal history in British common law and Napoleonic civil law has provided strong governing institutions since 1867. Certainly, Canada is one of the least-corrupt societies globally.

Still, early civil strife between the French and English has made citizens less attached to a national identity. Large migration flows from Eastern Europe and Asia to a relatively uninhabited Western Canada before the First World War created a different social identity there from that of Central and Eastern Canada.

So, over the years, Canadians have had difficulty in defining Canada’s national identity (beyond the right to health care as Roy Romanow put in his 2002 report). It is not surprising, then, that Canada is one of the most decentralized federations in the world. Perhaps, this has allowed us to better accommodate our fragmented society.

But with all the risks that fragmentation can bring, maintaining a national identity is not something Canadians should just give up on. It would be helpful if, in the 2019 election, parties offered us some clear and considerate thinking on reinforcing our national identity while accommodating our existing fragmentation. It would do us far more good than banal bromides and Twitter tirades.

Jack Mintz is the president’s fellow at the University of Calgary’s School of Public Policy.

Source: Financial Post