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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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  • Peter H. Egger
  • Andrea Lassmann

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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Suggested Citation

  • Peter H. Egger & Andrea Lassmann, 2015. "The Causal Impact of Common Native Language on International Trade: Evidence from a Spatial Regression Discontinuity Design," Economic Journal, Royal Economic Society, vol. 0(584), pages 699-745, May.
  • Handle: RePEc:wly:econjl:v::y:2015:i:584:p:699-745
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    File URL: http://hdl.handle.net/10.1111/ecoj.2015.125.issue-584
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Bonadio, Barthélémy & Fischer, Andreas M & Sauré, Philip, 2016. "The speed of the exchange rate pass-through," CEPR Discussion Papers 11195, C.E.P.R. Discussion Papers.
    2. Guillou, Sarah & Treibich, Tania, 2017. "Firm Export Diversification and Change in Workforce Composition," Research Memorandum 026, Maastricht University, Graduate School of Business and Economics (GSBE).
    3. Peter H. Egger & Marko Köthenbürger & Gabriel Loumeau, 2017. "Local Border Reforms and Economic Activity," CESifo Working Paper Series 6738, CESifo Group Munich.
    4. Sauré, Philip, 2017. "Time-intensive R&D and unbalanced trade," European Economic Review, Elsevier, vol. 91(C), pages 229-244.
    5. Barthélémy Bonadio & Andreas M. Fischer & Philip Sauré, 2018. "The speed of exchange rate pass-through," Working Papers 2018-05, Swiss National Bank.
    6. Michele Bernini & Jun Du & James H. Love, 2016. "Explaining intermittent exporting: Exit and conditional re-entry in export markets," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 47(9), pages 1058-1076, December.
    7. Ochsner, Christian & Roesel, Felix, 2016. "Migrating Extremists," Annual Conference 2016 (Augsburg): Demographic Change 145632, Verein für Socialpolitik / German Economic Association.
    8. Christian Ochsner, 2017. "Dismantled once, diverged forever? A quasi-natural experiment of Red Army misdeeds in post-WWII Europe," ifo Working Paper Series 240, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    9. Melitz, Jacques & Toubal, Farid, 2014. "Native language, spoken language, translation and trade," Journal of International Economics, Elsevier, vol. 93(2), pages 351-363.
    10. Guin, Benjamin, 2017. "Culture and household saving," Working Paper Series 2069, European Central Bank.
    11. Ferdinand Rauch & Matthias Beestermoller, 2014. "A Dissection of Trading Capital: Cultural persistence of trade in the aftermath of the fall of the Iron Curtain," Economics Series Working Papers 718, University of Oxford, Department of Economics.
    12. Tenzer, Helene & Terjesen, Siri & Harzing, Anne-wil, 2017. "Language in international business : A review and agenda for future research," Other publications TiSEM 8afd108a-9666-4fbb-934f-6, Tilburg University, School of Economics and Management.
    13. Anna Maria Koukal, 2017. "How Vatican II influenced female enfranchisement: A story of rapid cultural change," CREMA Working Paper Series 2017-07, Center for Research in Economics, Management and the Arts (CREMA).
    14. Branko Boskovic & Linda Nøstbakken, 2018. "How Much Does Anticipation Matter? Evidence from Anticipated Regulation and Land Prices," CESifo Working Paper Series 6888, CESifo Group Munich.
    15. repec:spr:manint:v:57:y:2017:i:6:d:10.1007_s11575-017-0319-x is not listed on IDEAS
    16. Peter Egger & Andrea Lassmann, 2014. "Cultural Integration and Export Variety Overlap Across Countries," CESifo Working Paper Series 4800, CESifo Group Munich.
    17. Jun Nagayasu, 2017. "Regional inflation, spatial locations and the Balassa-Samuelson effect: Evidence from Japan," Urban Studies, Urban Studies Journal Limited, vol. 54(6), pages 1482-1499, May.
    18. Peter Egger & Sergey K. Nigai, 2016. "World-Trade Growth Accounting," CESifo Working Paper Series 5831, CESifo Group Munich.
    19. Bonadio, Barthélémy & Fischer, Andreas M. & Saure, Philip, 2016. "The speed of exchange rate pass-through," Globalization and Monetary Policy Institute Working Paper 282, Federal Reserve Bank of Dallas.
    20. Fensore, Irene & Legge, Stefan & Schmid, Lukas, 2017. "Human Barriers to International Trade," Economics Working Paper Series 1712, University of St. Gallen, School of Economics and Political Science.

    More about this item

    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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