* Language Unification, Labor and Ideology Yang You Harvard University Last Updated: March 2018 Abstract By exploring an instance of nationwide language education reform—the Chinese Pinyin Act of 1958-1960—we estimate the effects of language unification using a difference-in-difference approach by interacting a birth cohort exposure dummy with the linguistic distances between local languages and Putonghua—modern standardized Mandarin. This paper presents five main findings: (1) learning Putonghua results in modest short-term negative effects, but long-term positive effects on educational attainment; (2) learning Putonghua increases rural households’ non-agricultural employment; (3) sharing a common language empowers workers to migrate across provinces and language regions; and (4) using a unified language fosters patriotism, a stronger national identity, a more positive subjective evaluation of China, and even more distrust in people of another nationality. One plausible channel is that the common language builds national identity by expanding exposure to audio-based media (e.g., radio, cell phone, and the internet); and (5) the post-reform population shows more skepticism about democracy, a better subjective evaluation of governance, and greater support for government intervention over economic liberalism. These changes in ideology and social preferences are consistent with the political doctrine of the Communist Party of China. Keywords: Language, Education, Labor market, Ideology, Social Preference JEL Code: I25, I26, L82, N45, O15, Z13 * We thank Michael Kremer for outstanding guidance and support. We are grateful to Alberto Alesina, Philipp Ager, Benjamin Enke, Richard Freeman, Edward Glaeser, Lawrence Katz, Nathan Nunn, Andrei Shleifer, Stefanie Stantcheva, Jack Willis, Noam Yuchtman and seminar participants at the Harvard Development Economics lunch seminar, the Economic History lunch seminar, the Public/Labor lunch seminar, the China Economy Seminar and The Econometric Society Asian Meeting 2017, for their comments and helpful discussions. Siwei Vivian Xu and Ying Liu provided excellent research assistance. 1 1. Introduction This paper studies the causal impact of learning in a unified national language rather than a local language, on educational and labor market outcomes, ideology, and social preferences by exploring the Chinese Pinyin Act Reform of 1958-1960. Although written Chinese is identical across China, local spoken languages (dialects) can differ so greatly throughout the country that people from diverse regions cannot understand each other. The language education reform unified spoken languages by shifting language pedagogy from “learning by character” to “learning by pronunciation” using Pinyin. To identify the language effects, we explore variation in computational linguistic distance from each local dialect to Putonghua (Zheng 1994). People whose native dialects are linguistically distant (close) are exposed to a larger (smaller) language unification shock. For example, Beijing Mandarin speakers are not affected by the Pinyin Act since Pinyin is precisely how their parents and neighbors speak. However, Cantonese speakers must learn a new language while in school because Putonghua differs so greatly from Cantonese. We generate a birth cohort exposure dummy1 based on the effective years of exposure to the Pinyin regime and use a difference-in-difference approach to estimate language effects by interacting the birth cohort exposure dummy with the linguistic distances. This paper documents results in three categories: First: Educational Attainment. One particular concern is that compulsory new language learning discourages students from education. In the Chinese context, we find evidence that new language learning very modestly deters students from schooling in the first five birth cohorts but encourages primary school enrollment in the long-run. However, the dynamic is weak in both economic scale and statistical power. 1 The Compulsory Schooling Law explicitly specifies that children should enroll in primary school between the ages of six and seven. In rural areas, children may start school at the age of eight or later. We assume students start primary school at the age of seven. For example, the Pinyin Act effect in 1960 for Jilin Province; we assume the birth cohort of 1953 is treated while the birth cohort of 1952 is not treated. 2 Second: Labor Market and Migration. According to the Population Census Survey in 2000, rural residents were more likely to gain non-agricultural employment, with a 10% increase in the linguistic distance corresponding to a 0.62% higher non-agricultural employment in the 20 post-reform birth cohorts. Using the same identification approach, we find that language unification increases migration across provinces and language areas, but reduces migration within provinces. These findings imply that a unified language enables workers to collaborate in the workplace more easily and lowers the cost of migration (Dustmann 2011). Third: Nation-Building, Ideology, and Social Preferences. Language unification also unifies peoples’ mindsets; speaking a common language nurtures their patriotism, strengthens national identity, and weakens local identity. People also express more distrust in people of another nationality. To investigate the mechanism, we find that the media may play an important role: people are inclined to follow political news more avidly and use more audio-based devices (e.g., radios and cell phones) but not text-based media (e.g., newspapers). Consistent with Chinese government’s doctrine, people believe that the Chinese government is more socialist democratic and its governance is better. Also, people express more skepticism towards the importance of democracy in western countries and develop stronger socialist preferences. We hypothesize that the common language increases information availability for non-Putonghua speakers, thus increasing their exposure to ideological doctrine broadcast by the government-controlled media. Language unification plays an important role in unifying ideologies across China and building a more integrated nation. This paper investigates language unification with broad implications in many countries both historically and contemporarily. Language matters in some recent disputes: President Donald Trump took down the Spanish White House webpages and catalyzed debate about whether the United States should implement an English-only policy, even though 17.6% of the national population is Hispanic and Latino. In Spain, Catalan speakers, who feel more Catalan than Spanish (Clots-Figueras and 3 Paolo Masella 2013), fought for an independent republic through the Catalan Independence Referendum of 2017. Historically, language unification typically happened simultaneously with state formation. In France, Weber (1976) emphasized that linguistic conversion to French was a crucial causal factor in developing the unity of minds, and French-speaking education was important to achieve national integration. Similarly, the Italian spoken today was known to less than 3% of the population when Italian unification began in 1861. Long after state formation, standard Italian, which had co-existed with diverse dialects, gradually spread over Italy and was ultimately approved as the official language by the Italian Parliament in 2007. Some recent trends also contribute to the growing importance of understanding language effects: globalization requires English fluency, as it is the dominant language in international trade. Many other countries2 are experiencing or have experienced language unification to some extent. This paper contributes to several strands of the literature. The primary focus in the literature is to measure labor market returns to language proficiency. Several papers (Kit-Ken 1994, Sridhar 1996, Yip et al. 2003, Grin 2006, Seid 2016) further compare the educational outcomes of learning in a foreign language versus a mother tongue. This paper shows the short-run negative, but subsequent long-run positive, dynamics of a new language on educational attainment; it further documents that learning Putonghua helps rural peasants shift to non-agricultural employment sectors. Additional, this paper relates to a more recent strand of literature that documents how language shapes migration (Isphording and Otten 2003, Falck et al. 2012, Adsera and Pytlikova 2015), cultural transmission (Lazear 1999, Fouka 2016), and economic preferences (Bleakley and Chin 2010, Chen 2013, Falk et al. 2016). This paper moves the frontier of identification strategy in literature by using an exogenous language policy shock to provide the causal evidence. 2 US (Lazear 1999, Saiz and Zoido 2005, Dustmann and Soest 2001), UK (Dustmann and Fabbri 2003), Canada (Carliner 1981, Chiswick and Miller 2001), Singapore (Kit-Ken 1994), Luxembourg (Fehlen 2002) and other EU Countries (Eurobarometer 2006) China (Zhou and Sun 2006), India (Sridhar 1996, Clingingsmith 2014), Chad (Thierry et al. 2016), Ethiopia (Seid 2016) and other African countries (Phillipson 1996, Banda 2000, Phillipson 2009) 4 Furthermore, this paper is connected to growing political economy literature on nation-building and ideology unification (Bandiera et al. 2017, Alesina et al. 2017, and Alesina et al. 2018). Alesina et al. (2018) argue that dictators are more likely than democratic governors to enforce uniformity of language and education curricula, especially when they feel threatened by a democratic movement or