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Earnings and Linguistic Proficiency in a Bilingual Economy

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  • Henley, Andrew

    (University of Wales Aberystwyth)

  • Rhian Eleri Jones

Abstract

Bilingualism is a widespread phenomenon, yet its economic effects are under researched. Typically studies find that bilingual workers are disadvantaged. Governments often protect minority languages through official promotion of bilingualism, with potential economic consequences. This paper addresses the impact of bilingualism on earnings, using the example of Wales. Results show a positive raw differential of 8 to 10 per cent depending on definition of linguistic proficiency. The use of Welsh in the workplace is not directly productive. Nevertheless language choice and earnings appear to be endogenous. The differential can be entirely explained by a selection effect. This is consistent with the effectiveness of legislation to promote the minority language.

Suggested Citation

  • Henley, Andrew & Rhian Eleri Jones, 2003. "Earnings and Linguistic Proficiency in a Bilingual Economy," Royal Economic Society Annual Conference 2003 106, Royal Economic Society.
    • Handle: RePEc:ecj:ac2003:106
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    2. Wang, Zhiling & de Graaff, Thomas & Nijkamp, Peter, 2017. "Look Who’s Talking: On the Heterogeneous Returns to Foreign Language Use at Work among Natives and Migrants in Europe," GLO Discussion Paper Series 104, Global Labor Organization (GLO).
    3. Donald R. Williams, 2011. "Multiple language usage and earnings in Western Europe," International Journal of Manpower, Emerald Group Publishing Limited, vol. 32(4), pages 372-393, July.
    4. Zhiling Wang & Thomas de Graaff & Peter Nijkamp, 2023. "Differences in Heterogeneous Returns to Foreign Language Use at Work Among Natives and Migrants in Europe," Romanian Journal of Regional Science, Romanian Regional Science Association, vol. 17(1), pages 1-37, June.
    5. WILLIAMS Donald R., 2006. "The Economic Returns to Multiple Language Usage in Western Europe," IRISS Working Paper Series 2006-07, IRISS at CEPS/INSTEAD.
    6. Alexander Muravyev & Oleksandr Talavera, 2010. "Can State Language Policies Distort Students' Demand for Higher Education?," University of East Anglia Applied and Financial Economics Working Paper Series 023, School of Economics, University of East Anglia, Norwich, UK..
    7. Aldashev, Alisher & Danzer, Alexander M., 2014. "Economic Returns to Speaking the Right Language(s)? Evidence from Kazakhstan's Shift in State Language and Language of Instruction," IZA Discussion Papers 8624, Institute of Labor Economics (IZA).
    8. Sílvio Rendon, 2007. "The Catalan premium: language and employment in Catalonia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 20(3), pages 669-686, July.
    9. Antonio Di Paolo & Aysit Tansel, 2015. "Returns to Foreign Language Skills in a Developing Country: The Case of Turkey," Journal of Development Studies, Taylor & Francis Journals, vol. 51(4), pages 407-421, April.
    10. Bengt-Arne Wickström, 2014. "Indigenes, immigration, and integration: a welfare-economics approach to minority rights," Chapters, in: Francesco Forte & Ram Mudambi & Pietro Maria Navarra (ed.), A Handbook of Alternative Theories of Public Economics, chapter 10, pages 227-242, Edward Elgar Publishing.
    11. Barry R. Chiswick & Paul W. Miller, 2018. "Do native-born bilinguals in the US earn more?," Review of Economics of the Household, Springer, vol. 16(3), pages 563-583, September.
    12. Jacek Liwiński, 2019. "The wage premium from foreign language skills," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 46(4), pages 691-711, November.
    13. Zhiling Wang & Thomas de Graaff & Peter Nijkamp, 2018. "Barriers of Culture, Networks, and Language in International Migration: A Review," REGION, European Regional Science Association, vol. 5, pages 73-89.
    14. Muravyev, Alexander & Talavera, Oleksandr, 2016. "Can state language policies distort students’ demand for education?," Journal of Comparative Economics, Elsevier, vol. 44(2), pages 383-399.
    15. Armstrong, Alex, 2015. "Equilibria and efficiency in bilingual labour markets," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 204-220.
    16. Rhydian Fôn James & Peter Midmore & Dennis Thomas, 2013. "‘Ground truths’ and scenarios: Examining and testing regional policy in North West Wales," Local Economy, London South Bank University, vol. 28(6), pages 643-662, September.
    17. Juan Carlos Jiménez Redondo, 2006. "La Economía de la lengua: una visión de conjunto," Documentos de Trabajo del Instituto Complutense de Estudios Internacionales 01-06, Universidad Complutense de Madrid, Instituto Complutense de Estudios Internacionales.
    18. Hahm, Sabrina & Gazzola, Michele, 2022. "The Value of Foreign Language Skills in the German Labor Market," Labour Economics, Elsevier, vol. 76(C).
    19. Fernando Bucheli, 2021. "Before Entering Adulthood: Developing an Index of Capabilities for Young Adults in Bogota," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 16(3), pages 965-1002, June.
    20. Chiswick, Barry R. & Miller, Paul W., 2016. "Does Bilingualism among the Native Born Pay?," IZA Discussion Papers 9791, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    earnings; language choice; human capital;
    All these keywords.

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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