Foreign language skills and labour market earnings in Rwanda

This paper investigates the extent to which proficiency in English and French as a form of human capital individually determine earnings in Rwanda's labour market and whether it still pays to be bilingual. Using data from the nationally representative Labour Force Survey conducted in 2018, our findings show that after controlling for other human capital and demographic factors, proficiency in both languages is positively rewarded. However, economic returns for proficiency in English language are higher than those for French proficiency and this gap widens from the median to the upper tail of the earnings distribution. Further, in the last two deciles of the earnings distribution, returns to English proficiency surpass returns to bilingual proficiency. A key finding of our study is that proficiency in English is highly rewarded while being bilingual in English and French pays but not in the upper 20% of the earnings distribution. The observed high returns to English language proficiency are likely the outcomes of the language reforms that have been implemented in the country and, most importantly, reflect the history of post-genocide Rwanda. English has become the language of business, government and education, and this trend is likely to continue.

Automated summary

This study investigates the impact of English and French proficiency as forms of human capital on earnings in Rwanda's labor market. The findings show that proficiency in English is more rewarded than proficiency in French, with the gap widening as earnings increase. Bilingual proficiency does not provide additional benefits in the top 20% of the earnings distribution. These results may be attributed to language reforms and the historical context of post-genocide Rwanda.