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The causal impact of common native language on international trade: Evidence from a spatial regression discontinuity design

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Abstract

This paper studies the effect of sharing a common native language on inter- national trade. Switzerland hosts three major native language groups which adjoin countries sharing the same native majority languages. In regions close to the internal language border the alternate major language is taught early on in school and not only understood but spoken by the residents. This setting allows for an assessment of the impact of common native rather than spoken language on transaction-level imports from neighbouring countries. Our findings point to an effect of common native language on extensive rather than on intensive margins of trade.

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  • Peter Egger & Andrea Lassmann, 2015. "The causal impact of common native language on international trade: Evidence from a spatial regression discontinuity design," KOF Working papers 15-374, KOF Swiss Economic Institute, ETH Zurich.
  • Handle: RePEc:kof:wpskof:15-374
    DOI: 10.3929/ethz-a-010396387
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    More about this item

    Keywords

    Common native language; Culture; International trade; Regression discontinuity design; Quasi-Randomised experiments;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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