INSIGHTS FROM BOOK TRANSLATIONS ON THE INTERNATIONAL DIFFUSION OF KNOWLEDGE A DISSERTATION SUBMITTED TO THE DEPARTMENT OF ECONOMICS AND THE COMMITTEE ON GRADUATE STUDIES OF STANFORD UNIVERSITY IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY Isabelle Yin Fong Sin May 2011 © 2011 by Isabelle Yin Fong Sin. All Rights Reserved. Re-distributed by Stanford University under license with the author. This work is licensed under a Creative Commons Attribution- Noncommercial 3.0 United States License. http://creativecommons.org/licenses/by-nc/3.0/us/ This dissertation is online at: http://purl.stanford.edu/df340nb1179 ii I certify that I have read this dissertation and that, in my opinion, it is fully adequate in scope and quality as a dissertation for the degree of Doctor of Philosophy. Ran Abramitzky, Primary Adviser I certify that I have read this dissertation and that, in my opinion, it is fully adequate in scope and quality as a dissertation for the degree of Doctor of Philosophy. Nicholas Bloom I certify that I have read this dissertation and that, in my opinion, it is fully adequate in scope and quality as a dissertation for the degree of Doctor of Philosophy. Avner Greif Approved for the Stanford University Committee on Graduate Studies. Patricia J. Gumport, Vice Provost Graduate Education This signature page was generated electronically upon submission of this dissertation in electronic format. An original signed hard copy of the signature page is on file in University Archives. iii iv Abstract Increases in the stock of ideas possessed by societies are central to modern economic growth. The implications of idea flows are striking: Klenow and Rodr´ıguez-Clare (2005) estimate world production would be just 6% of its current level if countries did not share ideas. Yet, although theoretical economists have studied ideas and their diffusion extensively, empirical studies are scarce because ideas are inherently difficult to measure. Previous empirical studies of idea flows have tended to use proxies such as trade flows, foreign direct investment, migration, and patent citations. However, with the exception of the latter, these measures are not pure idea flows, and do not capture the key properties of ideas, namely non-rivalry and disembodiedness. My research proposes a novel measure of idea flows, namely book translations, and uses it to study the factors that affect the international diffusion of ideas. Book translations are an attractive way to quantify idea flows because they are both non- rival and disembodied; they are a pure measure of idea flows rather than a by-product of a process such as trade or migration, and their key purpose is to make the ideas contained in the book accessible to speakers of another language. In chapter 2, I outline the economics literature on ideas and their diffusion. I motivate and discuss book translations as a measure of idea flows, and provide a framework for thinking about when translations are likely to occur. I describe the translation data in chapter 3. The source of the data is an inter- national bibliography of translations collected by the United Nations Educational, v Scientific, and Cultural Organization. From this bibliography, I compile a data set of over 2 million translations published in 80 countries since the 1949, including detailed information on each title translated. I then document the main patterns of translation flows. In chapter 4, I employ a gravity framework to study how distance affects translation flows between countries. This sheds light both on the barriers to international idea diffusion and on the underlying causes of the negative relationship between distance and trade. Translations differ from trade in that they have zero transportation costs, but they are subject to similar search and information costs and costs of forming contracts. I estimate a gravity model where bilateral translation flows vary with the sizes of the countries and the distance between them, and find the elasticity of translations with respect to distance to be between -0.3 and -0.5 for the 1990s; these values are significantly smaller than the equivalent elasticity for trade found in the literature, suggesting a significant role for transportation costs in the distance effect on trade. In addition, I present several pieces of evidence that suggest supply-side frictions play a larger role in the distance effect on translations than do consumer preferences. For instance, the speed with which titles are translated, which is likely to largely capture supply frictions as opposed to demand factors, decreases significantly with distance. Finally, in joint work with Ran Abramitzky (chapter 5), I study how the collapse of the Communist regime in Eastern Europe at the close of the 1980s affected the international diffusion of ideas. We show that while translations between Communist languages decreased by two thirds with the collapse, Western- to-Communist translations increased by a factor of seven and reached Western levels. Convergence was full in economically-beneficial fields such as sciences and only partial in culturally-beneficial fields such as history. The effects were larger for more Western- oriented countries. These findings help us understand how institutions shape the vi international diffusion of knowledge and demonstrate the importance of preferences in determining the type of ideas that diffuse into a country. vii Acknowledgements First and foremost, I am indebted to my advisor, Ran Abramitzky, for his enthusiasm, patience, and encouragement, as well as his incisive comments and sage counsel throughout the evolution of this dissertation research. I am also grateful to everyone who provided helpful comments and suggestions on this research, including (but not limited to) my advisors, Avner Greif, Nick Bloom, Jim Fearon and Kalina Manova, Manuel Amador, Kamran Bilir, Aaron Bodoh-Creed, Albie Bollard, Tim Bresnahan, Elan Dagenais, Doireann Fitzgerald, Regina Grafe, Paul Gregory, Caroline Hoxby, Nir Jaimovich, Seema Jayachandran, Pete Klenow, Naomi Lamoreaux, Ed Leamer, Aprajit Mahajan, Neale Mahoney, Roy Mill, Joel Mokyr, Nathan Nunn, John Pencavel, Luigi Pistaferri, Gary Richardson, Robert Staiger, Alessandra Voena, Romain Wacziarg, Gui Woolston, Gavin Wright, my classmates at Stanford, and numerous seminar participants. I thank the Index Translationum team, especially Alain Brion, Mauro Rosi, and Marius Tukaj, for providing me with a digital version of the recent translation data. I gratefully acknowledge financial support from the Ric Weiland Graduate Fellowship, the John E. Rovensky Fellowship, and the B.F. Haley and E.S. Shaw Fellowship. viii Contents Abstract v Acknowledgements viii 1 Introduction 1 2 The Economics of Ideas 10 2.1 The importance of ideas in historical perspective . 10 2.2 The economic theory of ideas . 12 2.2.1 One-country models . 13 2.2.2 Multiple-country models . 16 2.3 What types of ideas could be important? . 18 2.4 Measuring idea flows empirically . 20 2.4.1 Embodied idea flows . 20 2.4.2 Pure idea flows: Patent citations and translations . 22 2.5 When will translations occur? . 24 2.5.1 Translations versus bilingualism . 25 2.5.2 The decision to translate . 27 2.5.3 Implications for translation flows . 28 3 Data 31 ix 3.1 Data construction . 31 3.1.1 Translation data . 31 3.1.2 Physical environment data . 35 3.1.3 Cultural distance data . 38 3.2 Main patterns . 44 3.2.1 Countries primarily translate books into their main languages 44 3.2.2 Translations occur in a wide range of fields . 44 3.2.3 English is the most translated original language . 46 3.2.4 Germany overtook the USSR as the biggest translating country 49 3.2.5 Bigger, richer countries that trade less translate more . 49 3.2.6 Western Europe translates quickly . 51 3.3 Figures and tables . 54 4 The Gravity of Ideas 77 4.1 Introduction . 77 4.2 Empirical strategy . 82 4.2.1 Original languages and target languages and countries for gravity model . 84 4.2.2 Matching original languages to countries . 86 4.3 How distances affect translations . 87 4.3.1 The negative distance effect . 88 4.3.2 The negative distance effect over time . 92 4.3.3 Translations of different types of books are affected differently by physical distance . 93 4.3.4 Countries with similar physical environments translate more from each other . 94 4.3.5 Countries with similar cultures translate more from each other 95 x 4.3.6 Translations published in more developed countries decrease less with physical distance . 96 4.4 Speed of translations . 98 4.5 Conclusions . 99 4.6 Figures and tables . 102 5 The Collapse of Communism 113 5.1 Introduction . 113 5.2 Data . 120 5.2.1 The flow of book translations across countries . 120 5.2.2 Translation of influential titles . 122 5.3 Historical context . 123 5.3.1 A brief timeline of the collapse of Communism . 123 5.3.2 Publishing and censorship under Communism . 125 5.4 Empirical strategy . 128 5.5 The effect of the collapse on total translations . 132 5.5.1 Changes in overall translation patterns . 133 5.5.2 Changes in translations from Western and Communist languages . 134 5.5.3 Changes in translations in Soviet and Satellite countries . 137 5.5.4 Convergence in translation flows or catching up on stocks? . 139 5.5.5 The collapse of Communism did not affect original publications of books . 141 5.5.6 Further robustness checks . 142 5.6 The effect by book field . 144 5.6.1 Graphical evidence . 145 5.6.2 Regression analysis by book field . 146 xi 5.6.3 Regression analysis by book subfield . 147 5.7 The effect on influential titles . 149 5.8 Conclusions and discussion . 153 5.9 Figures and tables .