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The Economic Returns to Multiple Language Usage in Western Europe

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  • Williams, Donald R.

    (Kent State University (USA) and CEPS/INSTEAD (Luxembourg))

Abstract

To what extent are there economic returns to learning a second or third language? Do the benefits differ according to country? This paper examines the return to multi-lingualism in the workplace. In particular, we estimate the effect that using an additional language in one’s job has on earnings for a sample of workers in the European Community Household Panel survey. Log-earnings regressions are estimated by country with controls for standard human capital, job, and personal characteristics. Preliminary results indicate that the use of a second language in the workplace raises earnings by about 5 to 10 percent, but the results are sensitive to the specification used and vary across countries, occupations, and gender.

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Bibliographic Info

Paper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2006-07.

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Length: 32 pages
Date of creation: Oct 2006
Date of revision:
Handle: RePEc:irs:iriswp:2006-07

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  1. McManus, Walter S, 1985. "Labor Market Costs of Language Disparity: An Interpretation of Hispanic Earnings Differences," American Economic Review, American Economic Association, vol. 75(4), pages 818-27, September.
  2. Franco Peracchi, 2002. "The European Community Household Panel: A review," Empirical Economics, Springer, vol. 27(1), pages 63-90.
  3. Alejandra Cattaneo & Rainer Winkelmann, 2005. "Earnings Differentials between German and French speakers in Switzerland," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(II), pages 191-212, June.
  4. Barry R. Chiswick, 1998. "Hebrew language usage: Determinants and effects on earnings among immigrants in Israel," Journal of Population Economics, Springer, vol. 11(2), pages 253-271.
  5. Dustmann, C. & Soest, A.H.O. van, 1998. "Language Fluency and Earnings: Estimation with Misclassified Language Indicators," Discussion Paper 1998-120, Tilburg University, Center for Economic Research.
  6. Ingrid Tucci & Gert G. Wagner, 2003. "Fremdsprachenkenntnisse als wichtige Zusatzqualifikation im Dienstleistungssektor," DIW Wochenbericht, DIW Berlin, German Institute for Economic Research, vol. 70(41), pages 611-615.
  7. McManus, Walter & Gould, William & Welch, Finis, 1983. "Earnings of Hispanic Men: The Role of English Language Proficiency," Journal of Labor Economics, University of Chicago Press, vol. 1(2), pages 101-30, April.
  8. Leslie, Derek & Lindley, Joanne, 2001. "The Impact of Language Ability on Employment and Earnings of Britain's Ethnic Communities," Economica, London School of Economics and Political Science, vol. 68(272), pages 587-606, November.
  9. Henley, Andrew & Rhian Eleri Jones, 2003. "Earnings and Linguistic Proficiency in a Bilingual Economy," Royal Economic Society Annual Conference 2003 106, Royal Economic Society.
  10. Chiswick, Barry R & Miller, Paul W, 1995. "The Endogeneity between Language and Earnings: International Analyses," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 246-88, April.
  11. Geoffrey Carliner, 1981. "Wage Differences by Language Group and the Market for Language Skills in Canada," Journal of Human Resources, University of Wisconsin Press, vol. 16(3), pages 384-399.
  12. Lindley, Joanne, 2002. "The English Language Fluency and Earnings of Ethnic Minorities in Britain," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(4), pages 467-87, September.
  13. Dustmann, Christian & Fabbri, Francesca, 2000. "Language Proficiency and Labour Market Performance of Immigrants in the UK," IZA Discussion Papers 156, Institute for the Study of Labor (IZA).
  14. Kossoudji, Sherrie A, 1988. "English Language Ability and the Labor Market Opportunities of Hispanic and East Asian Immigrant Men," Journal of Labor Economics, University of Chicago Press, vol. 6(2), pages 205-28, April.
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Cited by:
  1. Tanova, Cem, 2006. "Using Job Embeddedness Factors to Explain Voluntary Turnover in Five European Countries," IRISS Working Paper Series 2006-04, IRISS at CEPS/INSTEAD.
  2. Stéphane Mussard & Michel Terraza, 2009. "Décompositions des mesures d’inégalité : le cas des coefficients de Gini et d’entropie," Discussion Papers (REL - Recherches Economiques de Louvain) 2009022, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  3. Voicu, Bogdan & Voicu, Malina & Strapcova, Katarina, 2007. "Engendered housework. A cross-european analysis," IRISS Working Paper Series 2007-07, IRISS at CEPS/INSTEAD.
  4. Antonio Di Paolo & Aysit Tansel, 2013. "“Returns to Foreign Language Skills in a Developing Country: The Case of Turkey”," IREA Working Papers 201319, University of Barcelona, Research Institute of Applied Economics, revised Nov 2013.
  5. Voicu, Malina & Voicu, Bogdan & Strapcova, Katarina, 2006. "Housework and gender inequality across Europe," IRISS Working Paper Series 2006-11, IRISS at CEPS/INSTEAD.
  6. Ingo E. Isphording, 2013. "Returns to Foreign Language Skills of Immigrants in Spain," LABOUR, CEIS, vol. 27(4), pages 443-461, December.
  7. Sirovatka, Tomas & Valentova, Marie, 2006. "The Legitimacy of Redistribution: the Czech Republic in International Comparison," IRISS Working Paper Series 2006-12, IRISS at CEPS/INSTEAD.
  8. Valentova, Marie, 2007. "Attitudes to Family Policy Arrangements in Relation to Attitudes to Family and division of Labour between Genders," IRISS Working Paper Series 2007-05, IRISS at CEPS/INSTEAD.
  9. Kankarash, Milosh & Moors, Guy, 2007. "Heterogeneity in solidarity attitudes in Europe. Insights from a multiple-group latent-class factor approach," IRISS Working Paper Series 2007-06, IRISS at CEPS/INSTEAD, revised Jun 2007.
  10. Aurélien Portuese, 2012. "Law and economics of the European multilingualism," European Journal of Law and Economics, Springer, vol. 34(2), pages 279-325, October.

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