IZA DP No. 13897: Talking Business: New Evidence on How Language Shapes Economic Behaviour
We provide a large scale within-country analysis of the effect of language future time reference (FTR) on the choice of being an entrepreneur using individual-level data from Switzerland, a country characterized by a unique long-standing multilingualism and a large share of immigrant population. We test the hypothesis that speakers of weak FTR languages may have a closer perception of future rewards and be more willing to become entrepreneurs, a choice that reflects future orientation. Our analysis consistently indicates that immigrants who speak weak FTR languages are around 2 percent more likely to be entrepreneurs compared to speakers of strong FTR languages, net of unobservable ancestral cultural traits, districts of destination's characteristics, linguistic features other than FTR, and whether individuals maintain their native language or switch to one of the four Swiss languages.