The demand for foreign languages in Italian manufacturing

Roberto Antonietti and Massimo Loi ()

No 57, Working Papers from AlmaLaurea Inter-University Consortium

Abstract: Relying on a rich firm-level dataset, we investigate the factors underlying the demand for foreign languages (FL) by Italian manufacturing firms. As main determinants, we focus on innovation and internationalization activities, these latter ranging from export to FDI. In the empirical analysis, we first estimate the probability of demanding for the knowledge of at least one FL through a set of univariate probit models, in which we also control for other characteristics required by firms, like the type of job, the level of education, the type of experience and the knowledge of informatics. Then, we make the demand for FL interact with the demand for these characteristics by estimating a set of bivariate probit models from which we extract the joint and conditional probabilities. Our estimates show that the probability to demand for FL increases with firm size, human capital intensity, engagement in R&D and in exporting goods, whereas the other internationalization activities are not significant when considered individually. Instead, we find a strong and positive effect on FL demand of increasing commitment to internationalization. Moreover, R&D and internationalization acts like observable substitutes on FL demand. When we further make FL demand interact with other required attributes, we find that the impact of increasing exposure to internationalization is higher when the firm also demands for professional occupations with a university degree, for specific experience and for the simultaneous knowledge of informatics. We conclude that FL are a strategic asset for firms and, from a labor demand perspective, are complementary to high levels of human capital.

Keywords: foreign languages; innovation; internationalization; labor demand (search for similar items in EconPapers)
JEL-codes: F16 J23 L60 (search for similar items in EconPapers)
Pages: 32
Date: 2014-02
New Economics Papers: this item is included in nep-ino, nep-int and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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