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Returns to dialect

Author

Listed:
  • Chen, Zhao
  • Lu, Ming
  • Xu, Le

Abstract

Though Mandarin is China's common language, each region/city has its own dialect. Using a unique self-collected dataset, this paper estimates returns to dialect familiarity in China's largest and most developed city, Shanghai. We evaluate migrant workers' comprehension and fluency of the Shanghai dialect, and instrument their dialect fluency by determining whether the workers' hometowns were located in the Wu dialect region and the distance between those hometowns and Shanghai. We determined that in OLS regressions, the returns to dialect are a consequence of endogeneity bias. After using IV (instrumental variable), dialect fluency was shown to significantly impact one's income in the service industry, in particular affecting sales jobs. In manufacturing and construction jobs, migrants with higher dialect fluency tended to be self-employed in order to earn more income. By distinguishing between listening and speaking abilities, we found that auditory comprehension does not significantly increase one's earning, while oral fluency does. Since local residents in Shanghai can understand Mandarin, migrants who can understand Shanghainese won't have difficulty in the information exchange. Therefore, our results confirm that dialect is a channel through which people expose their identity. Speaking the local dialect is a way for migrant workers to integrate into the local society and also to reduce transaction costs in the labor market.

Suggested Citation

  • Chen, Zhao & Lu, Ming & Xu, Le, 2014. "Returns to dialect," China Economic Review, Elsevier, vol. 30(C), pages 27-43.
  • Handle: RePEc:eee:chieco:v:30:y:2014:i:c:p:27-43
    DOI: 10.1016/j.chieco.2014.05.006
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    References listed on IDEAS

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    Cited by:

    1. Ding, Sai & Dong, Xiao-Yuan & Maurer-Fazio, Margaret, 2016. "How Do Pre-School and/or School-Age Children Affect Parents' Likelihood of Migration and Off-Farm Work in Rural China's Minority Regions?," IZA Discussion Papers 10073, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Language returns; Dialect; Labor market; Instrumental variable;
    All these keywords.

    JEL classification:

    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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