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Foreign Languages and Trade

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  • Jan Fidrmuc

    ()

  • Jarko Fidrmuc

    ()

Abstract

Cultural factors and especially common languages are well-known determinants of trade. By contrast, the knowledge of foreign languages was not explored in the literature so far. We combine traditional gravity models with data on fluency in the main languages used in EU and candidate countries. We show that widespread knowledge of languages is an important determinant of foreign trade, with English playing an especially important role. Other langauges (French, German, and Russian) play an important role mainly in particular regions. Furthermore, we argue that the effect of foreign langauges on trade may be non-linear. The robustness of our results is confirmed by quantile regressions.

Suggested Citation

  • Jan Fidrmuc & Jarko Fidrmuc, 2009. "Foreign Languages and Trade," CEDI Discussion Paper Series 09-03, Centre for Economic Development and Institutions(CEDI), Brunel University.
  • Handle: RePEc:edb:cedidp:09-03
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    References listed on IDEAS

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    Cited by:

    1. Brindusa Anghel & Antonio Cabrales & Jesus M. Carro, 2016. "Evaluating A Bilingual Education Program In Spain: The Impact Beyond Foreign Language Learning," Economic Inquiry, Western Economic Association International, vol. 54(2), pages 1202-1223, April.
    2. Isphording, Ingo, 2013. "Returns to Local and Foreign Language Skills – Causal Evidence from Spain," Ruhr Economic Papers 398, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    3. Herrmann-Pillath, Carsten & Libman, Alexander & Yu, Xiaofan, 2014. "Economic integration in China: Politics and culture," Journal of Comparative Economics, Elsevier, vol. 42(2), pages 470-492.
    4. Ingo Isphording, 2013. "Returns to Local and Foreign Language Skills – Causal Evidence from Spain," Ruhr Economic Papers 0398, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    5. Fidrmuc, Jarko & Senaj, Matus, 2012. "Human Capital, Consumption, and Housing Wealth in Transition," Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 62058, Verein für Socialpolitik / German Economic Association.
    6. Nicolas Sauter, 2012. "Talking trade: language barriers in intra-Canadian commerce," Empirical Economics, Springer, vol. 42(1), pages 301-323, February.
    7. Ingo E. Isphording, 2013. "Returns to Foreign Language Skills of Immigrants in Spain," LABOUR, CEIS, vol. 27(4), pages 443-461, December.
    8. Donald Lien & Yaqin Wang, 2013. "An economic analysis of instructional language," Education Economics, Taylor & Francis Journals, vol. 21(4), pages 380-391, September.
    9. Peter Egger & Andrea Lassmann, 2014. "Cultural Integration and Export Variety Overlap Across Countries," CESifo Working Paper Series 4800, CESifo Group Munich.
    10. repec:zbw:rwirep:0398 is not listed on IDEAS
    11. Paniagua, Jordi & Figueiredo, Erik & Sapena, Juan, 2015. "Quantile regression for the FDI gravity equation," Journal of Business Research, Elsevier, vol. 68(7), pages 1512-1518.
    12. Daria Ciriaci & Alessandro Muscio, 2011. "University choice, research quality and graduates' employability: Evidence from Italian national survey data," Working Papers 48, AlmaLaurea Inter-University Consortium.
    13. König, Jörg & Ohr, Renate, 2011. "Small but beautiful? Economic impacts of the size of nations in the European Union," Center for European, Governance and Economic Development Research Discussion Papers 128, University of Goettingen, Department of Economics.
    14. Helble, Matthias & Ngiang, Boon-Loong, 2014. "From Global Factory to Global Mall: East Asia’s Changing Trade Composition," ADBI Working Papers 496, Asian Development Bank Institute.
    15. repec:got:cegedp:128 is not listed on IDEAS

    More about this item

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F15 - International Economics - - Trade - - - Economic Integration
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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