Discussion paper

DP3590 Language and Foreign Trade

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.

£6.00
Citation

Melitz, J (2002), ‘DP3590 Language and Foreign Trade‘, CEPR Discussion Paper No. 3590. CEPR Press, Paris & London. https://cepr.org/publications/dp3590