Family Clans and Public Goods : Evidence from the New Village Beautification Project in South Korea

Ethnic and linguistic heterogeneity are widely studied as determinants of social capital, conflict, and institutional quality. In many cultures, another important dimension of heterogeneity is family clan membership. I study the relationship between family clan diversity in South Korean villages and the voluntary production of public goods and contributions of private resource for village projects. Under the 1970-1971 New Village Beautification Project, the government distributed resources to each village for the production of village public goods. Subsequently, the government systematically evaluated how well these resources were applied. I combine these data with information on village family clan structures collected by the Japanese Colonial Government, as well as records of land donations for village projects between 1970 and 1980. I find an inverted-U-shaped effect of group heterogeneity on the improvement of public goods