Industrialization and Bilingualism in India

Abstract

Many of the world’s poorest people live in linguistically diverse countries where bilingualism is a distinct and important form of human capital. When communication among workers increases productivity, there are economic incentives to learn a second language. I study how the growth of industrial employment increased bilingualism in India between 1931 and 1961. Indian factories were linguistically mixed. I exploit industrial clustering and sectoral demand growth for identification. The effect on bilingualism was strongest in import-competing districts and among local linguistic minorities. Industrialization also increased literacy. Bilingualism was mainly the result of learning, rather than than migration or assimilation. It was not a byproduct of becoming literate. My results shed new light on human capital investment in developing economies and on the long-run evolution of languages and cultures.