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Modeling the effect of the domestic business environment on services trade

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  • Gani, Azmat
  • Clemes, Michael D.

Abstract

This paper models the effect of the indicators of the domestic business environment on services trade in a sample of low, middle and high-income OECD countries. The findings reveal that the time required to enforce a contract is strongly negatively correlated with the growth in services exports in the high-income OECD countries as well as with the growth in services imports in the middle and high-income OECD countries. A strong inverse correlation of the time required to register a property with the growth in services imports is confirmed for the OECD and middle-income countries and the growth in services exports for the low-income countries. Internet diffusion and the strength of legal rights are strongly positively correlated with services exports in the OECD countries while the strength of legal rights is also strongly positively correlated with services imports in the middle and low-income countries. The growth of world income has a strong positive effect on the growth of services exports in the OECD and middle-income countries while domestic income growth strongly impacts on the growth in services imports across the three income category of countries. Finally, tariff is strongly negatively correlated with services exports for the middle-income group of countries.

Suggested Citation

  • Gani, Azmat & Clemes, Michael D., 2013. "Modeling the effect of the domestic business environment on services trade," Economic Modelling, Elsevier, vol. 35(C), pages 297-304.
  • Handle: RePEc:eee:ecmode:v:35:y:2013:i:c:p:297-304
    DOI: 10.1016/j.econmod.2013.06.033
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    Cited by:

    1. Valentina Diana RUSU & Angela ROMAN, 2016. "The Business Environment In Cee Countries: Current Challenges And Perspectives," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 8(1), pages 128-147, March.

    More about this item

    Keywords

    Business; Services; Trade; Contract enforcement; Income; Internet and legal rights;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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