About nine months ago I posted about a peculiar finding about Indonesian local politics: the observation that there appeared to be high levels of political fragmentation in the most ethnically homogenous districts. It makes sense to observe that ethnic heterogeneity produces a fragmented party system, but not that ethnic homogeneity would do the same. I found this puzzling.
Sometimes, though, a puzzling result is just a mistake. I think that that is what happened here. Together with my co-authors, I have been recreating political fractionalization and ethnic fractionalization scores from the original raw data, ethnicity data from the 2000 Census and party seat shares in the district legislatures from the General Election Commission. (We had been using indices created by someone else, probably for a different purpose.) In the process of doing this, I found a load of errors in our original data, many of them quite significant.
Here is that same scatterplot using the corrected data.
Ethnolinguistic and Political Fractionalization Indices
The indices of political and ethnic fractionalization are the standard Herfindahl-style indices: if pi is the proportion of ethnic group (or political party) i in a district, then a district’s total fractionalization score is
FRACTIONALIZATION = 1–Σ(pi)2
Very straightforward stuff. In addition to a positive correlation between ethnic and political heterogeneity, we observe in this figure as well a classic example of heteroskedasticity: there is a higher variance in political fractionalization in more ethnically homogenous districts than in more ethnically heterogenous ones (a Breusch-Pagan test strongly rejects the null of homoskedasticity; some further digging indicates that the political fractionalization index is not normally distributed). We also see that the green dashed line (the linear fit) and the red solid line (the lowess fit) are nearly identical, which suggests that there isn’t any significant non-linearity in the bivariate relationship.
Anyway, the question about what to do about the peculiar relationship that we’ve uncovered between ethnic fractionalization and political fragmentation turns out to be an artifact of some bad data. Happily, with the better data our earlier results appear even stronger: in Indonesian local politics, more political fragmentation -> lower budget surpluses.
tompepinsky.com 
Samuel Clark March 25, 2013
Hi Tom. I was just having another look at this post as I’m hoping to use some measure of political competition/fractionalistion to look at its effects on subnational corruption enforcement (one quant chapter in the phd). The explanation I’ve come up with from case studies would suggest that greater fractionalisation would lead to more local pressure for corruption enforcement, although I’d want to come up with something reassembly a “polarisation” index perhaps based on election alliances. Anyway, I was just wondering if you could elaborate a little on the problems you found in the original dataset. Also, I noticed that your PFI is from 2005 in the first post and 2004 in the second. Is that just a typo or related to the errors or something else?
Tom March 25, 2013
I think that 2005 was just a typo in the first post. On the errors: if I remember correctly, the main problem we found is that the data that we had borrowed from someone else had some wonky numbers for ELF in some parts of Bali, implying super-high ELF which just couldn’t be right. We dug around to see if it was counting foreigners or something like that, but nothing came up.