Language and Foreign Trade

Jacques Melitz

No 3590, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The significance of a common language in foreign trade hinges on translation as well as the ability to communicate directly. In fact, without admitting the facility of translation from one or two selected languages, it is impossible to explain adequately the impact of a common language on foreign trade. Linguistic diversity at home also promotes foreign trade. But the most significant linguistic influence of all on foreign trade is the ability to read and write any language whatever. Besides these basic results, the study examines three special issues: whether English and other European languages are more effective than other languages in promoting foreign trade; whether there are substitution effects of a common language in foreign trade; and whether network externalities of language impinge on foreign trade.

Keywords: Language; Foreign trade; Gravity model (search for similar items in EconPapers)
JEL-codes: F10 F40 (search for similar items in EconPapers)
Date: 2002-10
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Citations: View citations in EconPapers (22)

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Related works:
Journal Article: Language and foreign trade (2008)
Working Paper: Language and Foreign Trade (2003)
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