Same Same But Different: Dialects and Trade
AbstractLanguage is a strong and robust determinant of international trade patterns: Countries sharing a common language trade significantly more with each other than countries using different languages, holding other factors constant. In this paper, we show that this trade-promoting effect of language is likely to reflect cultural ties, rather than lower costs of communication or similar institutions. Analyzing unique data for a single-language country, Germany, we find that similarities in the local dialect between regions have a sizable and significant positive impact on intra-national trade. We interpret this finding as evidence for the effect of culture on trade.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7397.
Length: 22 pages
Date of creation: May 2013
Date of revision:
Publication status: forthcoming in: German Economic Review
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Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
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Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F15 - International Economics - - Trade - - - Economic Integration
- Z10 - Other Special Topics - - Cultural Economics - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-05-19 (All new papers)
- NEP-CUL-2013-05-19 (Cultural Economics)
- NEP-EUR-2013-05-19 (Microeconomic European Issues)
- NEP-INT-2013-05-19 (International Trade)
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