The Influence of Common Language on the Trade of Wheat and Bakery Products

ABSTRACT This study examines whether sharing a common official language increases the probability that two countries engage in bilateral trade of wheat and bakery products. Using a binary choice framework applied to 54,780 country‐pair observations for 2023, probit and logit models of the extensive margin of trade are estimated, with a focus on whether the role of language differs between a homogeneous commodity and a processed, differentiated good. The results show that a common official language raises the probability of a wheat trade relationship by approximately 3.6 percentage points, and that this effect increases to roughly 5.6 percentage points for bakery products, about 58% larger for processed goods than for raw wheat. These findings are consistent with the view that commodity trade is driven primarily by factor endowments and comparative advantage, whereas trade in processed products is also shaped by cultural variables such as language. The results are robust across probit and logit specifications and to an alternative language measure, and contribute to the literature on language, informational frictions, and the extensive margin of agri‐food trade.