Language, Economic Development and Economic Globalization: The Case of OECD Countries

Although the relation between economic development and economic globalization has been examined in the literature, the relation between linguistic diversity, economic development and economic globalization index has not been discussed much in the literature. With this aspect of the study, it is aimed to contribute to the literature. In this study, the relationship between linguistic diversity, economic globalization and economic development for 20 OECD founding countries between 1995 and 2018 was determined by Pesaran (2008) cross-section dependency test, Durbin-Hausman (2008) panel cointegration test and Emirmahmutoğlu and Köse (2011) panel causality tests. According to the panel causality test results of Emirmahmutoğlu and Köse (2011), it was found that there is a bidirectional causality relationship between linguistic diversity and economic development in OECD countries, a bidirectional causality relationship between economic development and economic globalization, and a unidirectional causality relationship from linguistic diversity to economic globalization.

of capital movements through the reorganization of financial services, enabling the markets to open to trade and investment causes an increase in competition. The role of information and communication technologies (ICT) is to contribute to the globalization process (Šliburytė and Masteikienė, 2010: 289).

Literature Review
Since the 1960s, a specialization area under the name of "the economics of language" has emerged. In the literature and economic analyzes, more emphasis is placed on economic approaches such as the effects of language skills on labor income and the choice of language policies (Lamberton, 2002;Grin, 1996Grin, , 2003. Although not much attention has been paid to language in the field of development economics, linguists have mostly argued that languages should play a role in economic development (Seargeant & Earling, 2011).
Considering the relationship between language and economy, it is seen that there are not many studies in the field.
Most of the research in the economics of language remains at the microeconomic level. In this study, it is aimed to contribute to the literature by analyzing the causality relationship between economic development, language diversity and economic globalization. In the literature, the causality relationship between economic development and linguistic diversity is bidirectional. While economic development decreases language diversity, the existence of a common language increases economic development. It is due to the fact that residents of countries with little linguistic diversity can communicate better and thus increase the scope of trade and specialization. In this study, it is tested whether there is a causality relationship between economic development, economic globalization and linguistic diversity.

Econometric Application
In the study, it is aimed to examine the relationship between language diversity, economic globalization and economic development by making empirical analysis for the 20 founding countries of the OECD (Organization for Economic Co-operation and Development) for the period 1995-2018. In the application part of the study, "linguistic diversity index", "economic development" and "economic globalization" variables are taken as variables, and the relationship between variables is set out. The aim of this study is to examine the relationship between the variables as well as the causality connections between economic development and language proposed by Arcand (1996). For this purpose, the economics of language is mentioned in the theoretical context.

1. Econometric Analysis and Findings
In this study, for 20 OECD founding member countries (USA, Germany, Austria, Belgium, England, Denmark, France, Netherlands, Ireland, Spain, Sweden, Switzerland, Italy, Iceland, Canada, Luxembourg, Norway, Portugal, Greece and Turkey) the relationship between language diversity, economic development, and economic globalization is aimed to invastigate. In the study, econometric analysis is performed by using the variables such as economic globalization index, language diversity index, and economic development index (human development index). In the econometric analyzes Gauss 10 program was used.
Economic globalization index was accessed from the database 'www.theglobaleconomy.com'; linguistic diversity index was accessed from the database 'https://knoema.com'; and human development index, as an indicator of economic development, was accessed from OECD statistics database. In the study, the cross section dependency of variables and models was tested with Breusch and Pagan (1980)  In panel data analyzes, which are performed using data from multiple countries, homogeneity tests are applied to determine whether the coefficients of the data belonging to countries are homogeneous or heterogeneous and to determine the cointegration and causality tests to be used in econometric analysis. In the models of homogeneity tests used in the analyzes " is expressed as slope coefficients equal to β, which is a single slope coefficient." In the heterogeneity test, it is expressed that the slope coefficient of at least one of the slope coefficients in econometric models is different. Homogeneity of the coefficients is interpreted with the Δ (delta_tilde) Δ (delta_tilde_adj) statistics obtained from Pesaran and Yamagata (2008) homogeneity tests, and econometric cointegration and causality tests are determined and applied according to the homogeneity or heterogeneity of the coefficients (Gül and İnal, 2017: 70-82 (Westerlund, 2008: 196-199 In equation 1, while defines the vector of intrinsic variables, and defines dimensional constant effects vector, defines the optimum delay length and defines the max. degree of integration. Zero hypothesis: If, is "No Granger causality", the alternative hypothesis means "Granger causality exists". It is tested by placing zero restrictions on the first P parameters in the light of these hypothesis. The obtained test statistics (modified Wald) have asymptotic chi-square distribution with p degrees of independence. Fisher statistics were developed for the panel to test the hypothesis expressed as "no Granger causality" (Gözbaşı, 2015: 277, 278): In Equation 2, defines the probability value for the modified Wald statistic. Fisher statistics has an asymptotic chi-square distribution with 2N degrees of independence. In the last stage of the analysis, the direction of causality between variables is investigated. The panel causality test developed by Emirmahmutoğlu and Köse (2011) (1980) LM, Pesaran (2004) LM and CD and Baltagi, Feng and Kao (2012) LM cross-section dependency tests. The crosssection coefficients of the variables used in the analyzes, probability for each variables when probability values are less than p <0.05 for all variables used in the analysis, the coefficients of are not homogeneous. Note: ***, **, * denotes heterogeneity according to the 10%, 5% and 1% significance levels, respectively. Dev: Economic development, Ldi: Linguistic diversity index and Glob: Economic globalization index.
As seen in Table 3, Pesaran and Yamagata (2008) homogeneity test findings are expressed. According to the homogeneity coefficients of each model in which each variable is taken as the dependent variable, respectively, the coefficients are not homogeneous since probability values are less than p <0.05 for each model.
In Table 7, according to the panel causality test results, the causality relationship analysis findings from linguistic diversity to globalization and from globalization to linguistic diversity were analyzed on the basis of countries, respectively. As for the panel in general (p-value <0.05) is significant, there is a unidirectional causality relationship from linguistic diversity to globalization in OECD countries. When the causality relationship between linguistic diversity and globalization is examined on the basis of countries since it is significant (p-value <0.05), the causality relationship from linguistic diversity to globalization is valid for Denmark, France, the Netherlands and Iceland; One way causality from globalization to linguistic diversity is valid for England and Norway.
Journal of Literature, Languages and Linguistics www.iiste.org ISSN 2422-8435 An International Peer-reviewed Journal Vol.71, 2020  and Trade) and OECD, which were established under the leadership of the USA constitute the starting point of globalization. Especially with the financial and economic liberalization period seen in the world economy after 1980, the concept of globalization gained momentum for the world economy and the internationalization of the world economy proves that globalization has an economic purpose. Emirmahmutoğlu-Köse (2011), when the panel causality test results are interpreted for owerall the panel, it is stated that there is a bidirectional causality relationship between linguistic diversity and economic development in 20 OECD founding member countries, and a bidirectional causality relationship between economic development and economic globalization. It was also found that there is a unidirectional causality relationship from linguistic diversity to economic globalization.
When causality relationships between linguistic diversity and economic development are evaluated on the basis of countries, there is causality relationship from the linguistic diversity to economic development in Germany, Austria, Netherlands and Greece and unidirectional causality relationship from economic development to linguistic diversity in Turkey, Italy, Britain, Denmark, France, Spain, Sweden, Luxembourg and Portugal. In OECD countries such as Germany, Austria, Netherlands and Greece, linguistic diversity leads economic development while in the countries such as Turkey, Italy, Britain, Denmark, France, Spain, Sweden, Luxembourg and Portugal, the level of economic development leads linguistic diversity.
It is seen that there is a causality relationship from linguistic diversity to economic globalization in Denmark, France, Netherlands and Iceland. The increasing language diversity in these countries makes easier for countries to establish foreign trade connections with each other and increases the terms of trade of these countries. Thus, foreign trade terms, which increase due to linguistic diversity, lead these countries to become globalized economically. In England and Norway, it was found a unidirectional causality relationship from economic globalization to linguistic diversity. Economic globalization that emerged with financial liberalization causes an increase in linguistic diversity.
There is a causality relationship from economic development to economic globalization in countries such as Italy, Belgium, Denmark, France, the Netherlands and Portugal. In the 1980s, with the increasing globalization, in the countries such as Turkey, Italy, England, Sweden, Switzerland, Canada, Portugal, and Greece located between developed and developing countries in the industry, it was found unidirectional causality relationship from economic globalization to economic development. It is appropriate to say that the production and capital increase accelerated in these countries due to the increasing industrialization, and accordingly, globalization gained speed with the integration of the world countries with each other.