["Economics &Politics, EarlyView. ", "\nABSTRACT\nThis paper presents data on ideology‐adjusted fractionalization of legislatures for an unbalanced panel of 76 countries over 1970–2019. Drawing from the V‐Party database, I combine a wide variety of positions and stances of political parties with their seat shares to construct a new index of lower‐chamber ideological diversity by country‐year. I then employ this index to empirically explore its effect on good‐for‐growth regulatory reform in up to 65 countries over 2000–2019. I provide evidence of an inverse‐U relationship between the magnitude of policy change and ideological fractionalization, and show that policy coherence declines as fractionalization increases. Implications for growth are discussed.\n"]