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Determinants of individuals' preference for cross-cultural literacy: Role of international trade potential

  • Kandogan, Yener
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    After an overview of the literature on cultural differences acting as trade barrier, and examining the data on how European companies deal with these differences, cross-cultural literacy through learning foreign languages is suggested as an alternative to the practice of hiring immigrants. A three-country theoretical model is developed to examine how individuals' preferences for foreign languages are affected by differences in population sizes, cultural and geographical distances, in the presence of a widely spoken language such as English. The model's results show that individuals prefer learning the language of countries with larger populations that are geographically close but culturally distant, which is consistent with the data showing foreign language preferences of many countries around the World. The model also predicts that population growth and improvements in transportation technology increases cross-cultural literacy across the countries.

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    File URL: http://www.sciencedirect.com/science/article/pii/S1090951610000532
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    Article provided by Elsevier in its journal Journal of World Business.

    Volume (Year): 46 (2011)
    Issue (Month): 3 (July)
    Pages: 328-336

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    Handle: RePEc:eee:worbus:v:46:y:2011:i:3:p:328-336
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    1. James E. Rauch & Vitor Trindade, 2002. "Ethnic Chinese Networks In International Trade," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 116-130, February.
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    6. Choi, E. Kwan, 2002. "Trade and the adoption of a universal language," International Review of Economics & Finance, Elsevier, vol. 11(3), pages 265-275.
    7. Kwok Leung & Rabi S Bhagat & Nancy R Buchan & Miriam Erez & Cristina B Gibson, 2005. "Culture and international business: recent advances and their implications for future research," Journal of International Business Studies, Palgrave Macmillan, vol. 36(4), pages 357-378, July.
    8. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, vol. 70(5), pages 950-59, December.
    9. Andy C W Chui & Alison E Lloyd & Chuck C Y Kwok, 2002. "The Determination of Capital Structure: Is National Culture a Missing Piece to the Puzzle?," Journal of International Business Studies, Palgrave Macmillan, vol. 33(1), pages 99-127, March.
    10. Wagner, Don & Head, Keith & Ries, John, 2002. "Immigration and the Trade of Provinces," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 507-25, December.
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