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|Title:||Foreign languages and trade|
|Keywords:||Gravity models; foreign trade; language effects; median regression; quantile regression|
|Citation:||Economics and Finance Discussion Paper, Brunel University, 09-14.|
|Abstract:||Cultural factors and especially common languages are well-known determinants of trade. By contrast, the knowledge of foreign languages was not explored in the literature so far. We combine traditional gravity models with data on fluency in the main languages used in EU and candidate countries. We show that widespread knowledge of languages is an important determinant for foreign trade, with English playing an especially important role. Other languages (French, German, and Russian) play an important role mainly in particular regions. Furthermore, we document non-linear effects of foreign languages on trade. The robustness of the results is confirmed in quantile regressions.|
|Appears in Collections:||Economics and Finance|
Dept of Economics and Finance Research Papers
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