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Language knowledge and earnings in Catalonia

Author

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  • Antonio Di Paolo

    (Departament d'Economia Aplicada, Universitat Autònoma de Barcelona (UAB); Campus de Bellaterra, Edifici B 08193 Bellaterra (Cerdanyola), Spain. Institut d’Economia de Barcelona, Universitat de Barcelona.)

  • Josep Lluís Raymond

    (Departament de Fonaments de l’Anàlisi Econòmic, Universitat Autònoma de Barcelona (Spain). Institut d’Economia de Barcelona, Universitat de Barcelona.)

Abstract

This paper investigates the economic value of Catalan knowledge for national and foreign first- and second-generation immigrants in Catalonia. Specifically, drawing on data from the “Survey on Living Conditions and Habits of the Catalan Population (2006)”, we want to quantify the expected earnings differential between individuals who are proficient in Catalan and those who are not, taking into account the potential endogeneity between knowledge of Catalan and earnings. The results indicate the existence of a positive return to knowledge of Catalan, with a 7.5% increase in earnings estimated by OLS; however, when we account for the presence of endogeneity, monthly earnings are around 18% higher for individuals who are able to speak and write Catalan. However, we also find that language and education are complementary inputs for generating earnings in Catalonia, given that knowledge of Catalan increases monthly earnings only for more educated individuals.

Suggested Citation

  • Antonio Di Paolo & Josep Lluís Raymond, 2010. "Language knowledge and earnings in Catalonia," Working Papers XREAP2010-07, Xarxa de Referència en Economia Aplicada (XREAP), revised Jul 2010.
    • Handle: RePEc:xrp:wpaper:xreap2010-07
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    References listed on IDEAS

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    More about this item

    Keywords

    Language; Earnings; Immigrants; Endogeneity; Complementarity;
    All these keywords.

    JEL classification:

    • J79 - Labor and Demographic Economics - - Labor Discrimination - - - Other
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models

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