Victor Ginsburgh, 8 February 2012
English is the dominant language of the Internet, business, and world trade. Do we need another? This column applies an economist’s rationale to the question.
Full Article:
The uselessness of learning foreign languages// oAnth:
[...]
Worldwide, English is indeed the language that is most often used in
international contacts and trade. But it is not the only one, as shown
by Jacques Melitz (2008) who uses two measures of linguistic distances
between trading partners and tries to estimate their effect.
‘Open-circuit communication’ (OCC) demands that the language be either
official or widely spoken (at least 20% of the population knows the
language). Spanish, for instance, will be an OCC between Bolivia (where
44% of the population knows Spanish) and Mexico (88%). A ‘direct
communication’ (DC) language is any language common (that is, spoken by
at least 4% in each country) in a pair of countries. In short, Melitz
suggests distinguishing between two channels through which the
trade-enhancing effect may take place: OCCs that depend on translation
(which can be produced as long as there are enough people who can
provide it in both countries) and DCs (which enable traders to
communicate directly). He finds that ‘direct communication’ has the
largest positive effect on trades: A 10% increase in the probability
that two citizens, one in country
A, the other in
B, speak
the same language increases their trades by 10%. Other European OCCs
also contribute, but somewhat less. However, and interestingly enough,
Melitz also shows that English as an OCC is no more effective than other
European languages in promoting trade.
[...]