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Talking trade: language barriers in intra-Canadian commerce

  • Nicolas Sauter

    ()

This paper tests for one mechanism that can explain the existence of a language barrier to trade. Specifically, I ask if those industries that require more cross-border communication in order to export their products trade more between Canadian provinces that know the other's language(s). I find that trade in industries with a need to communicate directly (orally) with importers increases with the probability that people in another province speak the same language. This finding can fill a missing link in the empirical trade literature, which lacked convincing arguments for the observed correlation between language commonality and the total volume of trade.

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File URL: http://hdl.handle.net/10.1007/s00181-010-0408-1
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Article provided by Springer in its journal Empirical Economics.

Volume (Year): 42 (2012)
Issue (Month): 1 (February)
Pages: 301-323

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Handle: RePEc:spr:empeco:v:42:y:2012:i:1:p:301-323
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