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Earnings And Linguistic Proficiency In A Bilingual Economy

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  • ANDREW HENLEY
  • 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. This differential persists in earnings function estimates, which control for human capital and demographic characteristics as well as local area effects. The potential endogeneity of language choice and earnings is addressed through the use of appropriate instrumental variables. Results suggest that bilingualism may be exogenous to the determination of earnings. Copyright Blackwell Publishing Ltd and The Victoria University of Manchester, 2005..

Suggested Citation

  • Andrew Henley & Rhian Eleri Jones, 2005. "Earnings And Linguistic Proficiency In A Bilingual Economy," Manchester School, University of Manchester, vol. 73(3), pages 300-320, June.
  • Handle: RePEc:bla:manchs:v:73:y:2005:i:3:p:300-320
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    Cited by:

    1. 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.
    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. 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.
    4. 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.
    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. 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," Discussion Papers in Economics 21875, University of Munich, Department of Economics.
    7. Muravyev, Alexander & Talavera, Oleksandr, 2010. "Can State Language Policies Distort Students' Demand for Higher Education?," IZA Discussion Papers 5411, Institute for the Study of Labor (IZA).
    8. Armstrong, Alex, 2015. "Equilibria and efficiency in bilingual labour markets," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 204-220.
    9. Chiswick, Barry R. & Miller, Paul W., 2016. "Does Bilingualism among the Native Born Pay?," IZA Discussion Papers 9791, Institute for the Study of Labor (IZA).
    10. Donald R. Williams, 2011. "Multiple language usage and earnings in Western Europe," International Journal of Manpower, Emerald Group Publishing, vol. 32(4), pages 372-393, July.
    11. Bengt-Arne Wickström, 2014. "Indigenes, immigration, and integration: a welfare-economics approach to minority rights," Chapters,in: A Handbook of Alternative Theories of Public Economics, chapter 10, pages 227-242 Edward Elgar Publishing.
    12. 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.

    More about this item

    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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