Returns to Foreign Language Skills in a Developing Country: The Case of Turkey

60 Pages Posted: 6 Nov 2013

See all articles by Antonio Di Paolo

Antonio Di Paolo

University of Barcelona

Aysit Tansel

Middle East Technical University (METU) - Department of Economics; IZA Institute of Labor Economics; Economic Research Forum (ERF)

Multiple version iconThere are 3 versions of this paper

Date Written: November 4, 2013

Abstract

Foreign language skills represent a form of human capital that can be rewarded in the labor market. Drawing on data from the Adult Education Survey of 2007, this is the first study estimating returns to foreign language skills in Turkey. We contribute to the literature on the economic value of language knowledge, with a special focus on a country characterized by fast economic and social development. Although English is the most widely spoken foreign language in Turkey, we initially consider the economic value of different foreign languages among the employed males aged 25 to 65. We find positive and significant returns to proficiency in English and Russian, which increase with the level of competence. Knowledge of French and German also appears to be positively rewarded in the Turkish labor market, although their economic value seems mostly linked to an increased likelihood to hold specific occupations rather than increased earnings within occupations. Focusing on English, we also explore the heterogeneity in returns to different levels of proficiency by frequency of English use at work, birth-cohort, education, occupation and rural/urban location. The results are also robust to the endogenous specification of English language skills.

Keywords: Foreign Languages, Returns to Skills, Heterogeneity, Turkey

JEL Classification: I25, J24, J31, O15, O53

Suggested Citation

Di Paolo, Antonio and Tansel, Aysit, Returns to Foreign Language Skills in a Developing Country: The Case of Turkey (November 4, 2013). Available at SSRN: https://ssrn.com/abstract=2349566 or http://dx.doi.org/10.2139/ssrn.2349566

Antonio Di Paolo

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

Aysit Tansel (Contact Author)

Middle East Technical University (METU) - Department of Economics ( email )

Inonu Bulvari
Ankara 06800
Turkey
90 312 210 2073 (Phone)
90 312 210 7964 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Economic Research Forum (ERF) ( email )

21 Al-Sad Al-Aaly St.
(P.O. Box: 12311)
Dokki, Cairo
Egypt

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