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An individual's receptive vocabulary includes all of the words that one recognizes and understands upon hearing or reading them. In contrast, productive vocabulary contains the words that one is able to produce. Words can be understood to varying degrees, so the words in one's productive or receptive vocabulary may not necessarily all be understood at the same level. Generally speaking, one can recognize and understand more words that one can actually produce, as contextual cues or similarities to other words may make an otherwise unfamiliar word understandable. Though both reading and listening are parts of reception, the size of one's receptive vocabulary may differ slightly between the two categories.
Not all words included in an individual's receptive vocabulary are understood at the same level, so criteria exist to rate the level of understanding. Complete fluency with a word, for example, involves being able to understand and clearly define the word upon reading or hearing it. This involves a superior degree of understanding to being able to correctly use the word but lacking the ability to provide a precise and comprehensive definition of it. Both of these are superior to understanding a word only through context or recognizing it but attaching no meaning to it at all.
Receptive vocabulary is studied by linguists, psychologists, and others for many different reasons. Language acquisition, both for children acquiring their first languages or for older people seeking to learn a new language, requires the development of a substantial receptive vocabulary. Language acquisition is an incredibly important skill, so some hope to improve learning methods by better understanding vocabulary development. Furthermore, various forms of brain damage and some psychological conditions can drastically alter the words that one can understand. Scientists and medical professionals hope to be able to understand and correct such losses of language.
Receptive vocabulary is also studied on occasion by sociologists, as vocabulary can have great social importance. It is, for instance, used as one measurement of the quality of one's education, as high-quality education tends to result in the development of a much larger vocabulary than education of lesser quality. Vocabulary effects the way in which people interact as well, as people are often judged socially based on the words that they use and understand. Furthermore, receptive vocabulary is closely linked to how accessible some types of literature are to some people. Some highly-regarded works of classical literature, for instance, are written with an elevated diction that those without highly developed vocabularies may find difficult to understand.
@EdRick - My little one is the same way! Will follow directions, but not much on talking.
In addition to being a mom, I'm a middle school teacher, and with them sometimes you can really see a word move from being one they don't know at all, to one in their receptive vocabulary, to one in their expressive vocabulary.
Once you teach them a word, through formal vocabulary instruction, it seems like they start to see that word everywhere, and every time they see it, they understand it better. Before you know it, they are confident enough to use it themselves.
You can particularly see a difference in receptive versus expressive vocabulary with toddlers. I remember when my son was little, he could produce very few words. Mostly "up," "bye-bye," and some version of "banana."
But he could follow directions using far more complex words. Before he was eighteen months old, I had taught him to put his dirty clothes in the hamper when I told him to, for instance. Since this was a kid who couldn't even ask for a cookie, he certainly couldn't say "clothes" or "hamper," but he knew what I was asking.
Some parents find that using baby signs narrows that gap a little bit as toddlers can make signs for words they can't pronounce. But my son was never a big fan of those, either.