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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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Paper provided by FIW in its series FIW Working Paper series with number 023.

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Length: 31
Date of creation: Jan 2009
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Handle: RePEc:wsr:wpaper:y:2009:i:023
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