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One Nation, One Language? Domestic Language Diversity, Trade and Welfare

Gurevitch, T.; Herman, P. R.; Toubal, Farid; Yotov, Y. (2020), One Nation, One Language? Domestic Language Diversity, Trade and Welfare. https://basepub.dauphine.psl.eu/handle/123456789/21895

Type
Document de travail / Working paper
Date
2020
Publisher
CEPII
Series title
CEPII Working Paper
Series number
2020-15
Published in
Paris
Pages
52
Metadata
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Author(s)
Gurevitch, T.
Herman, P. R.
Toubal, Farid
Yotov, Y.
Abstract (EN)
Using new data on linguistic diversity across and within countries, we examine novel channels though which language affects trade patterns and economic welfare. We find that linguistic similarity within a country accounts for about 10 percent of estimated `home bias', demonstrating the importance of shared languages for domestic integration. To highlight the general equilibrium implications of domestic language proximity, we simulate the repeal of Quebec's Bill 101, which made French an official language in Canada and established fundamental language rights for Frenchspeakers. The analysis demonstrates that domestic language diversity has significant implications for Canada's welfare but also sizable economic consequences that stretch far beyond its borders.
Subjects / Keywords
Common Language; Ethno-linguistic Diversity; Identity, International Trade; Domestic Trade; Domestic Trade Costs; D60, F14, F19, C54, Z13
JEL
Z13 - Economic Sociology; Economic Anthropology; Social and Economic Stratification
D60 - General
C54 - Quantitative Policy Modeling
F19 - Other
F14 - Empirical Studies of Trade

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