Foreign Language Skills and Wage Premiums in Central and Eastern Europe

Abstract

This paper investigates the role of foreign language skills in the Visegrad Four countries’ labour markets using data obtained from key online vacancy boards in these countries and from an online wage survey. Firstly, it considers the demand for language skills based on vacancies and then builds on this information by analysing the wage premium associated with foreign language skills on the occupation and individual level. The results indicate that English language knowledge is highly in demand in the Visegrad region, followed by the command of German language. Particularly, English proficiency appears to be correlated with higher wages, when controlled for common wage determinants in a regression.