Language, ethnicity and intrafirm trade

☆ The authors benefitted from the helpful suggestions b Behfar, AlanBeckenstein, JohnMclaren, Ariell Reshef, Jame Pravin Krishna (who saw an earlier version of the paper) Peter Debaere received research funds from the Darden F ⁎ Corresponding author at: Darden School of Business States. Tel.: +1 434 243 2339; fax: +1 434 243 7678. E-mail addresses: [email protected] (P. (H. Lee), [email protected] (J. Lee). 1 In gravity equations that explain international trade ten proxy for frictions or barriers; see Bergrstrand and Eg (2001) reviews social networks and how they facilitate he points out, empirical work often focuses on ethnic n the only important ones, but rather because many oth to observe or measure; see also Rauch and Trindade (20 in migration. The ability to speak English makes integra easier and allows immigrants to perform more high lev (2009). Several papers use ethnic and national links transaction costs in the literature on foreign direct inv al. (1995) and Debaere and Paik (2010).