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Bilateral digital connectivity and firm participation in export markets

Author

Listed:
  • Joël Cariolle

    (FERDI - Fondation pour les Etudes et Recherches sur le Développement International)

  • Michele Imbruno

    (UNIROMA - Università degli Studi di Roma "La Sapienza" = Sapienza University [Rome], Nottingham Center for Research on Globalisation and Economic Policy (GEP))

  • Jaime de Melo

    (UNIGE - Université de Genève = University of Geneva, FERDI - Fondation pour les Etudes et Recherches sur le Développement International)

Abstract

This paper studies how bilateral digital connectivity resulting from telecommunications submarine cable (SMC) deployment affects firm participation in export markets. Using an unbalanced panel of bilateral trade data from 48 countries during the period 1997-2014, we find that a SMC connection between two countries is associated with an increase in the number of bilateral exporters in developed countries, but also with a reduction in the number of bilateral exporters in developing countries. This negative association between bilateral connectivity and firm participation in export markets appears to be stronger in the poorest developing areas: Middle East and North Africa, South Asia and Sub-Saharan Africa. The growth in world connectivity spurred by SMCs deployment has therefore had a heterogeneous effect on firm decision to export, pushing more firms from high-income countries to enter export markets, and some incumbent exporters from lower-income countries to exit them.

Suggested Citation

  • Joël Cariolle & Michele Imbruno & Jaime de Melo, 2020. "Bilateral digital connectivity and firm participation in export markets," Working Papers hal-03182438, HAL.
    • Handle: RePEc:hal:wpaper:hal-03182438
    Note: View the original document on HAL open archive server: https://hal.science/hal-03182438
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    References listed on IDEAS

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    Cited by:

    1. Michele Imbruno & Joel Cariolle & Jaime de Melo, 2022. "Digital connectivity and firm participation in foreign markets: An exporter-based bilateral analysis," Discussion Papers 2022-02, University of Nottingham, GEP.
    2. Herman, Peter R. & Oliver, Sarah, 2023. "Trade, policy, and economic development in the digital economy," Journal of Development Economics, Elsevier, vol. 164(C).
    3. Jaime de Melo & Jean-Marc Solleder, 2022. "Patterns and Correlates of Supply Chain Trade in MENA and SSA," Working Papers hal-03649085, HAL.
    4. Marinella Boccia & Anna Maria Ferragina & Stefano Iandolo, 2022. "Follow the cloud! The impact of ICT on Italian provinces’ trade," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 49(4), pages 667-690, December.

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    Keywords

    Internet Connectivity; ICT; Submarine cables; Export behaviour;
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