What is the difference between the words which and that?
I have a car which is blue.
I have a car that is blue.
Are there any rules specifying usage of which and that?
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There is no difference in meaning. There is a difference in use.
Relative clauses—the sort of clause you use, “which is blue” / “that is blue”, which tells us something more about the noun referred to by which or that—are of two sorts: restrictive and nonrestrictive.
A restrictive clause restricts the noun it modifies to what’s defined in the clause. The clause identifies the noun and is essential to your meaning. For instance:
I looked at the books which he sent me last week. … The books I’m talking about are the ones which he sent me last week.
A nonrestrictive clause adds information about the noun it modifies. The clause is almost parenthetical, it could be left out without changing your meaning:
I looked at the books, which he sent me last week. … The books have already been identified in our discourse, I’m just throwing in a by-the-way comment about when I got them.
Note the comma in that sentence: it sets the clause off and ‘marks’ it as something added. Now Which/That …
That may only be used at the head of a restrictive clause. It is not used, in any register, with a nonrestrictive clause.
Which may be used at the head of either sort of clause.
You may encounter another rule, which is loudly disputed. About a century ago the Fowler brothers suggested a “division of labour”—using that only at the head of restrictive clauses and which only at the head of nonrestrictive clauses. This proposal made sense to many people, it was picked up by several prestigious grammarians and style guides, and in consequence it’s often cited as a “rule”.
But the fact is, this division has never been generally adopted, and there’s no reason to follow it. I myself don’t follow it; quite the opposite, I employ “which” wherever I can, because I believe that that has entirely too much work to do already and a multiplicity of thats is likely to confuse the reader.
But that’s my choice. You’re free to follow your own rule, as long as you don’t put that at the head of a non-restrictive clause.
You should use that when the clause is required for the sentence to make sense, and which when the clause is not necessary. Consider the following examples:
I would like you to hand me the pencil that is on the counter.
Here, the statement requires that since the clause afterwards provides necessary information.
We are having chicken, which is my favorite, for dinner tonight.
Here, we can remove the which clause and the meaning of the sentence perseveres.
Your example isn't the best, since it can be written much more tersely as "I have a blue car". If you had to choose though, you would probably go with "I have a car that is blue" if you want to emphasize the color of the car.
As commented by @bytebuster, although there is a potential "rule" in play here, most native speakers are either unaware of it, or ignore it anyway. For all practical purposes I think the right level of answer here on ELL is No, there's no difference in sentences like OP's quoted examples.
There are other types of sentence where they are used differently (Which do you want? That one!), but I assume OP isn't asking about contexts like that.
In this specific example, they are equivalent.
I'm not quite sure about that but I have a little hunch "which" implies a selection from a bigger set, while "that" may be used in relation to a completely unique item.
Does any of your five cars have registration starting with U?
You have several cars, from which one... You have only one blue ford, that...
Someone correct me if I'm wrong on that.
There is also a geographical reason besides most of the other points that have been said.
I have a car which is blue. This usage is UK English. I have a car that is blue. This usage is US English.
Apart from that, no difference whatsoever. The geographical line of distinction has become quite blurred on this now and people throughout the world use these subordinating conjunctions interchangeably nowadays.
It doesn't look like anybody really understood your questions. You're asking about "which" and "that" as relative pronouns. The difference is that "that" refers directly to the element it follows, so "I have a car that is blue" would be correct, because you're referring to the car.
On the other hand, "which" refers to the situation it follows: "I have a car, which is a necessity in Miami." Here you're referring to "having a car."
Two better examples:
Every night, my father makes me read a book that I hate.
[You hate the book]
Every night, my father makes me read a book, which I hate.
[You hate having to read a book every night]
You use which in questions when there are two or more possible answers or alternatives. Which do they want me to do, declare war or surrender?... Which are the ones you really like? Which are the good adverts for you?
Which is also a determiner. Which woman or man do you most admire?...
You go down that passageway over there.' -Which one?'... Which vitamin supplements are good value?
2) DET You use which to refer to a choice between two or more possible answers or alternatives. I wanted to know which school it was you went to... I can't remember which teachers I had... Scientists have long wondered which parts of the brain are involved in musical tasks. CONJ-SUBORD
Which is also a conjunction. In her panic she couldn't remember which was Mr Grainger's cabin... There are so many diets on the market, how do you know which to choose?
3) PRON-REL You use which at the beginning of a relative clause when specifying the thing that you are talking about or when giving more information about it. Soldiers opened fire on a car which failed to stop at an army checkpoint... He's based in Banja Luka, which is the largest city in northern Bosnia... Colic describes a whole variety of conditions in which a horse suffers abdominal pain... I'm no longer allowed to smoke in any room which he currently occupies.
4) PRON-REL You use which to refer back to an idea or situation expressed in a previous sentence or sentences, especially when you want to give your opinion about it. They ran out of drink. Which actually didn't bother me because I wasn't drinking... Since we started in September we have raised fifty thousand pounds, which is pretty good going... Visited Park West. Viewed a flat, no. 76. Which I like. DET: DET sing-n
Which is also a determiner. The chances are you haven't fully decided what you want from your career at the moment, in which case you're definitely not cut out to be a boss yet! 5) PHRASE: V inflects If you cannot tell the difference between two things, you can say that you do not know which is which. They all look so alike to me that I'm never sure which is which... It's essential to know which is which as treatments will be quite different.
1) PRON You use that to refer back to an idea or situation expressed in a previous sentence or sentences.
They said you particularly wanted to talk to me. Why was that?...
Hey, is there anything the matter with my sisters?' -Is that why you're phoning?'...
Some members feared Germany might raise its interest rates on Thursday. That could have set the scene for a confrontation with the US.
That is also a determiner. The most important purpose of our Health Care is to support you when making a claim for medical treatment. For that reason the claims procedure is as simple and helpful as possible.
2) DET You use that to refer to someone or something already mentioned. The Commissioners get between ₤50,000 and ₤60,000 a year in various allowances. But that amount can soar to ₤90,000 a year... The biggest increase was on the cheapest model, the CRX-HF. That car had a 1990 base price of $9,145.
3) DET When you have been talking about a particular period of time, you use that to indicate that you are still referring to the same period. You use expressions such as that morning or that afternoon to indicate that you are referring to an earlier period of the same day. The story was published in a Sunday newspaper later that week... That morning I had put on a pair of black slacks and a long-sleeved black blouse.
4) PRON: PRON of n, PRON pron-rel You use that in expressions such as that of and that which to introduce more information about something already mentioned, instead of repeating the noun which refers to it. [FORMAL] A recession like that of 1973-74 could put one in ten American companies into bankruptcy... Indoor pollution falls into two categories, that which we can see or smell, and pollution which is invisible and produces no odour.
5) PRON You use that in front of words or expressions which express agreement, responses, or reactions to what has just been said.
She said she'd met you in England.' -That's true.'...
I've never been to Paris.' -That's a pity. You should go one day.'
6) DET You use that to introduce a person or thing that you are going to give details or information about. [FORMAL] In my case I chose that course which I considered right... That person who violates the law and discriminates should suffer in his career.
PRON: PRON pron-rel That which is used to introduce a subject in very general terms. Too much time is spent worrying over that which one can't change.
7) DET You use that when you are referring to someone or something which is a distance away from you in position or time, especially when you indicate or point to them. When there are two or more things near you, that refers to the more distant one. Look at that guy. He's got red socks... Where did you get that hat?... You see that man over there, that man who has just walked into the room?
That is also a pronoun. Leo, what's that you're writing?... That looks heavy. May I carry it for you?
8) PRON You use that when you are identifying someone or asking about their identity.
That's my wife you were talking to...
That's John Gibb, operations chief for New York Emergency Management...
Who's that with you?' -A friend of mine.'...
I answered the phone and this voice went, `Hello? Is that Alison?'
9) DET You can use that when you expect the person you are talking to to know what or who you are referring to, without needing to identify the particular person or thing fully. [SPOKEN] I really thought I was something when I wore that hat and my patent leather shoes... Did you get that cheque I sent?... That idiot porter again knocked on my door!
PRON That is also a pronoun. That was a terrible case of blackmail in the paper today... That was a good year, wasn't it
If you're confused about that versus which, don't feel bad. It's one of the most common topics people ask me about. I used to work as a technical writer, and I'd often edit documents in which people used the wrong word. More than once, I'd put in the right word, only to have clients change a perfectly fine that to a which and send it back to me.Here's an example:
Gems that sparkle often elicit forgiveness.
The words that sparkle restrict the kind of gems you're talking about. Without them, the meaning of the sentence would change. Without them, you'd be saying that all gems elicit forgiveness, not just the gems that sparkle. (And note that you don't need commas around the words that sparkle.)
Diamonds, which are expensive, often elicit forgiveness.
Alas, in Grammar Girl's world, diamonds are always expensive, so leaving out the words which are expensive doesn't change the meaning of the sentence. (Also note that the phrase is surrounded by commas. Nonrestrictive clauses are usually surrounded by, or preceded by, commas.)
There is quite difference. Generally a relative clause starts with 'a relative pronoun'.
*** But if we want to modify the antecedent, we use 'that' or 'which'
Ex- This is the pen which she bought for ten rupees.
Ex- This is the same pen which she bought for ten rupees.
***But if we want to give extra information we cant use 'that' in a non defining clause
Ex- He bought a pen, which was lost.
Ex - He said he had no money , which was not true.
***But there are restricted rules when we must use 'that' ( instead of 'which ' 1. After superlative degree
" this is the most interesting book that is written on grammar."
"This is the only thing that i possess"
"All that glitters is not gold."
"I saw a man and a dog that were passing through the tunnel."
- "I have a car that/which is blue." (Restrictive / defining / essential relative clause, where both 'that' and 'which' may be used at the head of the clause.)
This sentence implies that the speaker has at least one other car. Specifically, the car he is taking about is distinguished from his other cars by its colour.
- "I have a car, which is blue." [Note there is a comma before 'which'). (Non-restrictive / non-defining / non-essential / continuative relative clause, where only 'which' is used with a comma.)
Here is no implication that the speaker owns more than one car. The 'blue' colour is simply an added description of the car.
Edit : There are two types of relative clause :
 Restrictive/defining/essential relative clause :
In this relative clause, either 'that' or 'which' may be used to introduce the relative clause. Some grammarians prefer 'that' in this case. Here, the relative clauses defines its antecedent and the relative clause is essential to make the meaning clear.
e.g., "My car that is blue goes fast."
Here, "that is blue" defines its antecedent "car". The sentence implies that the speaker has more than one car. Specifically, the car he is talking about is distinguished from his other cars by its blue colour.
 Non-restrictive/Non-defining/Non-essential/Continuative relative clause :
This type of relative clause doesn't definite its antecedent. It only adds information. This type is written with COMMAS at the beginning and end. The added description isn't essential. Here the relative clause is a parenthetical part, and for this it's named 'non-essential' relative clause.
e.g. "My car, which is green, goes fast."
Here, the which-clause, with commas before & after, is a non-defining relative clause. It means that the person has only one car which goes fast. The 'green' colour is the added description of the car.
However, the sentence of the OP, "I have a car that/which is blue." is the first type of relative clause, i.e., a restrictive or defining relative clause.