Language and Wealth

Harold F. Schiffman haroldfs at
Sun Apr 22 15:42:50 UTC 2007

All: here is another item I discovered recently, despite its 2006 date.

>>From The Washington Times


Language and wealth By Richard W. Rahn Published July 7, 2006


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

    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

    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.

    Richard W. Rahn is director general of the Center for Global Economic
Growth, a project of the FreedomWorks Foundation.

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