Working Paper: CEPR ID: DP13002
Authors: Shlomo Weber; Victor Ginsburgh
Abstract: The paper brings together methodological, theoretical, and empirical analysis into the single framework of linguistic diversity. It reflectsboth historical and contemporary research by economists and other social scientists on the impact of language on economic outcomes andpublic policies. We examine whether and how language influences human thinking (including emotions) and behavior, analyze the effects oflinguistic distances on trade, migrations, financial markets, language learning and its returns. The quantitative foundations of linguisticdiversity, which rely on group identification, linguistic distances as well as fractionalization, polarization and disenfranchisement indicesare discussed in terms of their empirical challenges and uses. We conclude with an analysis of linguistic policies and shifts of languagesand examine their welfare effects and the trade-offs between the development of labor markets and the social costs that they generate invarious countries.
Keywords: languages; economic behavior; educational linguistic policies; linguistic distances; diversity indices; welfare
JEL Codes: F13; F22; G11; H11; J15; J3; O10; Z13; Z18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| linguistic diversity (J15) | individual behavior (D01) |
| linguistic distance (Y80) | economic interaction (F61) |
| linguistic distance (Y80) | trade flows (F10) |
| linguistic distance (Y80) | migration patterns (F22) |
| language learning (I25) | economic opportunities (J68) |
| shifts in official languages (J68) | disenfranchisement (K16) |
| shifts in official languages (J68) | social costs (J32) |
| shifts in official languages (J68) | labor market dynamics (J29) |