Talking Trade: Language Barriers in Intra-Canadian Commerce

FIW Working Paper No. 23

32 Pages Posted: 17 Aug 2010

Date Written: January 15, 2009

Abstract

This paper tests for one mechanism that can explain the existence of a language barrier to trade. Specifically, I ask if those industries that require more cross-border communication in order to export their products trade more between Canadian provinces that know the other's language(s). I find that trade in industries with a need to communicate directly (orally) with importers increases with the probability that people in another province speak the same language. This finding reveals a disadvantage for minority language regions in services trade.

Keywords: Language, Trade cost, Gravity model, Canada

JEL Classification: F10, F15, F40

Suggested Citation

Sauter, Nicolas, Talking Trade: Language Barriers in Intra-Canadian Commerce (January 15, 2009). FIW Working Paper No. 23, Available at SSRN: https://ssrn.com/abstract=1343440 or http://dx.doi.org/10.2139/ssrn.1343440

Nicolas Sauter (Contact Author)

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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