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Language differences, cultural identity, and innovation

Author

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  • Chang'an Wang
  • Junqian Wu
  • Jianqing Ruan
  • Xiaoqian Liu

Abstract

Cultural variations caused by language differences hinder technology diffusion and economic development. Using China's city‐level data, we analyze the effect of language differences in cities on innovation. The result shows the larger the language differences within a city, the lower the innovation of that city. Then, using historical immigration data as an instrumental variable, we find the result is robust. Furthermore, by excluding the competitive channel, language communication, through which language differences influence innovation, we conclude the main channel is cultural identity.

Suggested Citation

  • Chang'an Wang & Junqian Wu & Jianqing Ruan & Xiaoqian Liu, 2022. "Language differences, cultural identity, and innovation," Growth and Change, Wiley Blackwell, vol. 53(4), pages 1716-1736, December.
    • Handle: RePEc:bla:growch:v:53:y:2022:i:4:p:1716-1736
    DOI: 10.1111/grow.12631
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