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The Impact of ICT on Trade in Persian Gulf Countries

Author

Listed:
  • Tayebeh Farahani

    (Assistant Professor, Faculty of Economics, Islamic Azad University of Buin Zahra)

  • Reza Parvardeh

    (M.A. Student of Islamic Azad University of Arak)

Abstract

Information and Communications Technologies( ICT) are transforming our world on a daily basis. In a fast-moving global economy, international trade, by adopting electronic technologies, could save billions of dollars every year. ICT development which has lead to faster, cheaper and more efficient modes of trade by reducing transactions costs. Due to the network characteristic of ICT, trade enhances when both trading partners have advanced ICT developments. The study analyzes empirically this theoretical argument. A gravity model is applied to assess the impact of ICT development on trade in Persian Gulf countries. In this study, it was tried to investigate the impact of ICT on business in the neighboring countries to the Persian Gulf. The obtained results from the gravity model assessment using panel data method for the countries of Iran, Bahrain, Iraq, Saudi Arabia, Oman, Kuwait, Qatar, and UAE from 2001 to 2009 showed that the better ICT development infrastructures the countries have, the more their business exchanges increase. In fact, for country business partners to increase business exchanges, it is imperative to have proper ICT development.

Suggested Citation

  • Tayebeh Farahani & Reza Parvardeh, 2012. "The Impact of ICT on Trade in Persian Gulf Countries," Iranian Economic Review, Economics faculty of Tehran university, vol. 17(2), pages 63-73, spring.
  • Handle: RePEc:eut:journl:v:17:y:2012:i:2:p:63
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    References listed on IDEAS

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    Keywords

    ICT; Trade; Panel Data;

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