Language and Wealth

From the desk of Richard Rahn on Tue, 2006-07-11 07:11

Does the language you speak or use help influence how wealthy you are?

When trying to determine why some countries are wealthier than others, economists rarely, if at all, consider language. However, if you look at the list of wealthiest countries on a per capita income basis, you will notice almost all the top 20 are English-speaking, or use some other Germanic language, with the exception of France, Japan, and Finland (however, most Finns know German and English as well as Swedish, and many Frenchmen know German and/or English).

English is only the primary language for about 5 percent (340 million) of the world’s people. Another 200 million, or 3 percent, are reasonably fluent in English, and perhaps up to another 500 million (8 percent) know some English.

The number of French and German speakers are each probably less than 3 percent of the world’s population. Yet, those who speak English or other Germanic languages account for more than 40 percent of the world GDP, while comprising only about 8 percent of the world's population.

The rankings of the other major languages are as follows (both primary and secondary speakers): Mandarin Chinese 1.1 billion; Hindi 490 million; Spanish 420 million; Arabic 255 million, and Russian also with 255 million.

Now, back to the basic question: Is there something about the English language itself that helps make one wealthier, and is there something about the Arabic language itself that inhibits economic development?

Several years ago, before his death, the distinguished musician, historian, philosopher and columnist Balint Vazsonyi told me he did not think it was possible for people who did not understand the English language to fully understand the English and American concepts of liberty, freedom and rule of law (and this from a Hungarian who did not learn English until he was in his 20s).

Other immigrants to America tell me the experience of living in a free market democratic country is what gives the real meaning to the words. Recently, I have been involved with a project to create a Standard International Dictionary of Economic Terms, Concepts, and Organizations. The project involves attempting to have standard, up-to-date translations of economic and financial terms and concepts so, regardless of language, everyone on the globe would understand the meaning of the ideas in the same way. Not being a linguist, I have found this is easier said than done, which caused me to remember Balint’s comments.

It turns out a body of Arabic scholars determines what words can be used in the Arabic language. Originally, no word could be used that was not found in the Koran, but this obviously became too restrictive as technology and ideas developed, so there is now the official approval body. The French also have the official language police to determine what word can and cannot be used in the French language. The problem is that the actions of the official language bodies tend to lag as new scientific discoveries are made and new technologies and concepts developed, and hence users of these languages are put into a linguistic straitjacket and time warp. There is no such official body for English, thus both foreign words and newly invented words are added to the English vocabulary every day by individuals and organizations across the globe.

Years back, when I was involved in the economic transition in Eastern Europe and the former Soviet Union, we had many language problems. For instance, the Russians never had a modern market economy, so that basic financial concepts like ‘depreciation’ and ‘present value’ were not understood and literal translations turned out to be meaningless at that time. Trying to privatize and sell companies where the language concepts did not exist to give an adequate financial evaluation was an additional challenge. Fortunately, the Russians, being practical, quickly grabbed the English words and concepts for their own use.

It is more difficult to comprehend ideas and concepts if there are no words for them in one’s language. Did you know there is no word for ‘enterprise’ in Arabic? English is becoming the world language by default, precisely because there is no institution that states what English is, thus it is totally open to new ideas, concepts, technologies, etc. (like open source software). In fact, the two largest English-speaking nations, the United States and the United Kingdom, do not have an official language (unlike most other countries) – English is only the de facto official language. Any country can adopt English as an official language if it wishes – and now about 50 of them have done so.

Obviously, the rule of law, property rights, trade, tax, monetary and regulatory policies, as well as culture and religion, all influence economic development. But perhaps the economics’ profession should look more closely at the role of language in predicting economic success. The words we use may also help determine how wealthy we are.

This piece was originally published on July 7, 2006 in The Washington Times.

Numbers are wrong

Submitted by Mary on Thu, 2006-07-13 14:52.

There are only 340 million native English speakers in the world? Sorry, no.

USA -- around 290 million native speakers
Canada -- 30 million
Australia -- 20 million
UK -- 60 million
Republic of Ireland -- 4 million
India -- around 400 million (middle and upperclasses are native English speakers)

That's 800 million already without counting the former British colonies in Asia and Africa.

Language, wealth, AND culture

Submitted by marcfrans on Wed, 2006-07-12 16:34.

The problem with Mr Rahn's article is that he focused on a SUPERFICIAL link, i.e. the correlation (but not causality) between language and wealth.

'George2' makes the excellent point that it is culture that determines BOTH language and wealth. And CULTURE determines wealth over the long run via (1) behavior patterns (e.g. work effort, savings propensity, etc...) and via (2) institutional arrangements (rule-of-law, property rights, human capital buildup and distribution, etc...). Ultimately, different cultures reflect different orderings of priorities and thus of values. It is different values that are reflected in different behavior patterns and institutional arrangements.

Language is a product of

Submitted by George2 on Wed, 2006-07-12 06:49.

Language is a product of culture. In the Arab language, that's what I've heard, there are many words for camel, just because in this particular culture, or group of cultures, a camel was/is important. Many African cultures and their languages do not have a word for 'planning' simply because it is not important for them. They live from day to day.

So it is not the language that determines national wealth. It is culture that determines both language and wealth. Therefore, language and wealth are correlated, there may be some causality between both, but the main driving factor for both is general culture. Having a country switch to another national language, will not change their wealth. It is a change in culture that will change wealth.

Furthermore, wealth is a relative thing. I do not wish African cultures the same Western wealth as we have in Europe and North America just because they don't have the same kind of individualism we have. They have a much greater sense of community. I have been dancing with an entire village in one big circle for a gift they had received. Taking up our sense of individualism would mean greater financial wealth for them, but a loss for their current culture.

As much as I don't like Islam 'values' taking over Europe, I don't like this belly button centered approach of thinking that our understanding of wealth is the best thing for the rest of the world to achieve.

Language and culture

Submitted by Esther on Wed, 2006-07-12 08:42.

George2, I agree completely. It is not language that's the issue, but culture.

The article brought as an example that there's no word "enterprise" in Arabic. I find that hard to believe. "Enterprise", as a verb, appears in the Hebrew bible at the beginning, in the story of the Tower of Babel.

However, 'enterprise' in the sense of 'free enterprise', that is, in the sense in which it is used in today's modern Western culture is something else. Having the word does not mean that you have the same defintion or understanding.

Islam In Europe

Economists and Language

Submitted by evan on Tue, 2006-07-11 17:19.

This is an extremely interesting topic. Economists have studied why languages tend to dominate or not, but AFAIK they have not studied the micro-efficiency of language (e.g., which conveys information most efficiently, which is easiest to master). Nor have they discussed the relation between language and prosperity, but I suspect that is because it is difficult to statistically disentangle language on the one hand and the culture of the country speaking the language on the other.

I think there is a significant lock-in effect that will preserve the dominance of English. I have heard that well over 90% of the literature in physics is published in English, and that means that any physicist who wants his results known must publish in English, which further strengthens its dominance. English did dislodge French and German (which, along with English, dislodged Latin) as the primary language of science, but that will probably not happen again.

As for Chinese, it is actually an extremely simple language grammatically, and once one gets the logic of the characters even those aren't so tough. But it is an Anglophone world for the foreseeable future in commerce and science.

I have written about some of these issues in Some Economics of Language.

World language

Submitted by hlhspons on Tue, 2006-07-11 14:25.

Four blows below the belt.

1. "... the top 20 are English-speaking, or use some other Germanic language". I suppose all those "other Germanic languages" are residual products of the formidable English tongue?

2. "...the two largest English-speaking nations, the US and the UK". I have been told that the US soon will be "the largest Spanish-speaking nation".

3. "English is becoming the world language". Wrong. Pidgin English is, in one of its numerous representations: business, diplomatic, scientific, touristic, pop English, etc.

4. My English is far from perfect. Who cares? I don't. " ... there is no institution that states what English is , thus it is totally open".

Monoglot

Submitted by Bob Doney on Tue, 2006-07-11 11:01.

By now it's clear that within a hundred years this planet will be monoglot. A single language will be left. As in consumer electronics, there is an unstoppable tendency to universal standards. Arabic, Chinese, French and all the rest will be the Betamax to English's VHS.

Why not Chinese? It's too damned difficult. Chinese youngsters themselves will not be prepared to put the work into learning their native language when they could be doing something more interesting. India will soon be the country with the most people, and as the general population there become more educated, the way they increasingly talk to each other is in, guess what, English.

Of course other languages will survive as local curiosities and as subjects for hobbyists and academics. But the Triumph of English is inevitable.

We, the English, hereby bequeath our language to the world. Aren't we kind?!

http://yaleglobal.yale.edu/display.article?id=5675

Bob Doney

One single global language? I don't think so.

Submitted by Bart Van Stappen on Tue, 2006-07-11 14:50.

When different languages meet, they have a tendency to intermixing.
Examples of Franglais, Spanglish and Inglish are given. Many others do exist.

However, in spreading to different cultures, one single language has a tendency to grow apart, too.

Thus, the language does not only form our views on the world, but the world we are living in is forming our language, too.

Each language constitutes a particular way of thought. We are thinking in and through our language(s), as well as our language(s) is (are) influenced by our way of thinking and by (our part of) the world we are living in.

Though they might all be called English, still, many tastes of English do exist today. They are not growing together, but rather growing apart.

Even when using the same word in what some do still believe to be the same language - e.g. English - it turns out that there is no mutual understanding any more.

As Esther says, in her "New Ideas" reaction, and in this matter says right so:

What about democracy? It's used by different people to mean different things, and yet even when people think that democracy is "the right to vote", they can tell that there's a difference between England and Iran (which is a democracy according to the UN). I do not think it is only lack of words which causes Iran to be a totalitarian regime and England a light of liberal democracy.

Indeed, in this matter, too, mutual understanding rather seems to be torn apart by speaking the same language. The one and only language is adding to the confusion.

There still is many truth in the old saying:
One is as many times a man
as languages speaking he can.

New ideas

Submitted by Esther on Tue, 2006-07-11 10:15.

A language may have an official body (for example, Dutch), but that does not mean that people stop innovating. If a person who doesn't speak English would want to use a word that is common in English and that he understands, he most probably would either find an alternative for it, or use the English straight out, whether the governing body of his language agrees or not.

The question is why that word doesn't appear in his language in the first place. Is it the language's fault?

I know there are debates about this among linguists. If there was no word for "anger", would there be no anger? Or would we call it something else? Or would we assume it is something else?

Hebrew did not have a word for 'flu' till just a few decades ago. This did not mean that people did not know what it was.. they simply used a non-Hebrew name.

Islam In Europe

language and wealth

Submitted by valknot on Tue, 2006-07-11 08:51.

IQ is the best predictor of individual and national wealth, Japan being a good example - few resourses but a high average I.Q., compared to Congo, many resourses but low I.Q.

IQ

Submitted by Bob Doney on Tue, 2006-07-11 12:34.

May I humbly suggest that you take your IQ theory and stuff it up your bottom. Go and do some reading on "cultural bias". And then some reading on the history (postcolonial and otherwise) of the Congo. There are many informed Belgians round here who could point you in the right direction, I'm sure.

Bob Doney