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Markets and linguistic diversity

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  • Caminal, Ramon

Abstract

Producers of cultural goods and media products can only make their specific contents available to their audiences and readerships through a particular language. The choice of language is a trivial decision if consumers are monolingual. However, the fraction of bilingual consumers is high in some areas and rising everywhere because of the rapid expansion of English as a second language. In this paper I argue that, independently of the gains associated with the use of a lingua franca, the very existence of bilingual consumers may seriously bias market outcomes against minority languages. In particular, I show that the level of linguistic diversity determined by profit maximizing firms tends to be inefficiently low, except when and where the cost of producing a second linguistic version becomes sufficiently low. Thus, the model provides an efficiency argument supporting policies that protect minority languages in these markets.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 7587.

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Date of creation: Dec 2009
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Handle: RePEc:cpr:ceprdp:7587

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Keywords: language; product variety; translation;

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  1. Ginsburgh, Victor & Weber, Shlomo & Weyers, Sheila, 2007. "Economics of Literary Translation: A Simple Theory and Evidence," CEPR Discussion Papers 6432, C.E.P.R. Discussion Papers.
  2. Ramon Caminal & Lluís M. Granero, 2008. "Multi-product firms and product variety," Working Papers 338, Barcelona Graduate School of Economics.
  3. Ortega, Javier & Tangerås, Thomas P., 2004. "Unilingual Versus Bilingual Education System: A Political Economy Analysis," IZA Discussion Papers 1433, Institute for the Study of Labor (IZA).
  4. Melitz, Jacques, 2007. "The impact of English dominance on literature and welfare," Journal of Economic Behavior & Organization, Elsevier, vol. 64(2), pages 193-215, October.
  5. GINSBURGH, Victor & ORTUNO-ORTIN, Ignacio & WEBER, Shlomo, 2004. "Disenfranchisement in linguistically diverse societies. The case of the European Union," CORE Discussion Papers 2004080, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. Edward P. Lazear, 1999. "Culture and Language," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S95-S126, December.
  7. Mélitz, Jacques, 2002. "Language and Foreign Trade," CEPR Discussion Papers 3590, C.E.P.R. Discussion Papers.
  8. Peitz, Martin & Valletti, Tommaso M., 2008. "Content and advertising in the media: Pay-tv versus free-to-air," International Journal of Industrial Organization, Elsevier, vol. 26(4), pages 949-965, July.
  9. Michael H. Riordan & Yongmin Chen, 2005. "Price and Variety in the Spokes Model," Discussion Papers 0405-20, Columbia University, Department of Economics.
  10. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
  11. Jeffrey Church & Ian King, 1993. "Bilingualism and Network Externalities," Canadian Journal of Economics, Canadian Economics Association, vol. 26(2), pages 337-45, May.
  12. N. Gregory Mankiw & Michael D. Whinston, 1986. "Free Entry and Social Inefficiency," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 48-58, Spring.
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Cited by:
  1. Ramon Caminal, 2013. "The Economic Value of Reciprocal Bilingualism," Working Papers 713, Barcelona Graduate School of Economics.
  2. Ramon Caminal, 2013. "The economic value of reciprocal bilingualism," UFAE and IAE Working Papers 933.13, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  3. Emilie Dargaud & Carlo Reggiani, 2012. "On the Price Effects of Horizontal Mergers : A Theoretical Interpretation," Working Papers 1222, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.

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