Linguistic Distance and Market Integration in India

Principal Investigator(s):  View help for Principal Investigator(s) James Fenske, University of Warwick; Namrata Kala, MIT Sloan

Version:  View help for Version V1

Name File Type Size Last Modified
fkldistance.do text/x-stata-syntax 91.7 KB 09/25/2020 05:54:AM
fkldistance.dta application/x-stata 61.5 MB 10/12/2020 02:08:AM

Project Citation: 

Fenske, James, and Kala, Namrata. Linguistic Distance and Market Integration in India. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2020-10-12. https://doi.org/10.3886/E124121V1

Project Description

Summary:  View help for Summary The role of cultural distance in market integration, particularly in the developing world, has received relatively little attention. Using prices from over 200 South Asian markets spanning 1861 to 1921, we show that linguistic distance correlates negatively with market integration. A one-standard-deviation increase in linguistic distance predicts a reduction in the price correlation between two markets of 0.121 standard deviations for wheat, 0.181 for salt, and 0.088 for rice. While factors like genetic distance, literacy gaps, and railway connections are correlated with linguistic distance, they do not fully explain the correlation between linguistic distance and market integration.


Funding Sources:  View help for Funding Sources John Fell Fund



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