Common tongue: The impact of language on economic performance

This paper investigates the impact of language on economic performance. I use the 1956 reorganization of Indian states on linguistic lines as a natural experiment to estimate the impact of speaking the majority language on educational and occupational outcomes. I find that districts that spoke the majority language of the state during colonial times enjoy persistent economic benefits, as evidenced by higher educational achievement and employment in communication intensive sectors. After reorganization, historically minority language districts experience greater growth in educational achievement, indicating that reassignment could reverse the impact of history.