IDEAS home Printed from https://ideas.repec.org/a/spr/weltar/v157y2021i4d10.1007_s10290-021-00417-2.html
   My bibliography  Save this article

Do data policy restrictions inhibit trade in services?

Author

Listed:
  • Erik Marel

    (ECIPE, Université Libre de Bruxelles & ECARES)

  • Martina Francesca Ferracane

    (European University Institute (EUI))

Abstract

This paper examines whether restrictive data policies are related to trade in services. The authors have collected comparable information on a variety of policy measures that regulate data for a wide group of countries for the years 2006–2016. This information is compiled in a weighted index that assesses the restrictiveness of these countries’ data policies. They distinguish between policies regulating the cross-border movement of data and policies regulating the domestic use of data. Using econometric estimations, they show that strict data policies are negatively and significantly associated with imports of data-intense services. Therefore, countries applying restrictive data policies, in particular with respect to the cross-border flow of data, are likely to suffer from lower levels of services traded cross-border. The results of this analysis are significant and hold for various robustness checks.

Suggested Citation

  • Erik Marel & Martina Francesca Ferracane, 2021. "Do data policy restrictions inhibit trade in services?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 157(4), pages 727-776, November.
  • Handle: RePEc:spr:weltar:v:157:y:2021:i:4:d:10.1007_s10290-021-00417-2
    DOI: 10.1007/s10290-021-00417-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10290-021-00417-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.

    File URL: https://libkey.io/10.1007/s10290-021-00417-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Nathan Nunn, 2007. "Relationship-Specificity, Incomplete Contracts, and the Pattern of Trade," The Quarterly Journal of Economics, Oxford University Press, vol. 122(2), pages 569-600.
    2. Avi Goldfarb & Catherine Tucker, 2012. "Privacy and Innovation," NBER Chapters, in: Innovation Policy and the Economy, Volume 12, pages 65-89, National Bureau of Economic Research, Inc.
    3. Ariu, Andrea & Breinlich, Holger & Corcos, Gregory & Mion, Giordano, 2019. "The interconnections between services and goods trade at the firm-level," Journal of International Economics, Elsevier, vol. 116(C), pages 173-188.
    4. John Romalis, 2004. "Factor Proportions and the Structure of Commodity Trade," American Economic Review, American Economic Association, vol. 94(1), pages 67-97, March.
    5. Renaud Bourlès & Gilbert Cette & Jimmy Lopez & Jacques Mairesse & Giuseppe Nicoletti, 2013. "Do Product Market Regulations In Upstream Sectors Curb Productivity Growth? Panel Data Evidence For OECD Countries," The Review of Economics and Statistics, MIT Press, vol. 95(5), pages 1750-1768, December.
    6. Erik van der Marel & Matthias Bauer & Hosuk Lee-Makiyama & Bert Verschelde, 2016. "A methodology to estimate the costs of data regulations," International Economics, CEPII research center, issue 146, pages 12-39.
    7. Mary Amiti & Jozef Konings, 2007. "Trade Liberalization, Intermediate Inputs, and Productivity: Evidence from Indonesia," American Economic Review, American Economic Association, vol. 97(5), pages 1611-1638, December.
    8. Martina Francesca Ferracane & Janez Kren & Erik van der Marel, 2020. "Do data policy restrictions impact the productivity performance of firms and industries?," Review of International Economics, Wiley Blackwell, vol. 28(3), pages 676-722, August.
    9. Rueda-Cantuche, José & Kerner, Riina & Cernat, Lucian & Ritola, Veijo, 2016. "Trade in services by GATS modes of supply: Statistical concepts and first EU estimates," DG TRADE Chief Economist Notes 2016-3, Directorate General for Trade, European Commission.
    10. Ariu, Andrea & Mayneris, Florian & Parenti, Mathieu, 2020. "One way to the top: How services boost the demand for goods," Journal of International Economics, Elsevier, vol. 123(C).
    11. Bernard Hoekman & Ben Shepherd, 2017. "Services Productivity, Trade Policy and Manufacturing Exports," The World Economy, Wiley Blackwell, vol. 40(3), pages 499-516, March.
    12. Mr. Chris Papageorgiou & Mr. Saurabh Mishra & Ke Wang & Mr. Prakash Loungani, 2017. "World Trade in Services: Evidence from A New Dataset," IMF Working Papers 2017/077, International Monetary Fund.
    13. Beverelli, Cosimo & Fiorini, Matteo & Hoekman, Bernard, 2017. "Services trade policy and manufacturing productivity: The role of institutions," Journal of International Economics, Elsevier, vol. 104(C), pages 166-182.
    14. Carol Corrado & Jonathan Haskel & Cecilia Jona-Lasinio & Massimiliano Iommi, 2012. "Intangible Capital and Growth in Advanced Economies: Measurement Methods and Comparative Results," Economics Program Working Papers 12-03, The Conference Board, Economics Program.
    15. Jacob Funk Kirkegaard, 2008. "Distance Isn’t Quite Dead: Recent Trade Patterns and Modes of Supply in Computer and Information Services in the United States and NAFTA Partners," Working Paper Series WP08-10, Peterson Institute for International Economics.
    16. Corrado, Carol & Haskel, Jonathan & Iommi, Massimiliano & Jona-Lasinio, Cecilia, 2012. "Intangible Capital and Growth in Advanced Economies: Measurement and Comparative Results," CEPR Discussion Papers 9061, C.E.P.R. Discussion Papers.
    17. Magdeleine, Joscelyn & Maurer, Andreas, 2008. "Measuring GATS mode 4 trade flows," WTO Staff Working Papers ERSD-2008-05, World Trade Organization (WTO), Economic Research and Statistics Division.
    18. Aaditya Mattoo & Joshua P Meltzer, 2018. "International Data Flows and Privacy: The Conflict and Its Resolution," Journal of International Economic Law, Oxford University Press, vol. 21(4), pages 769-789.
    19. Pinelopi Koujianou Goldberg & Amit Kumar Khandelwal & Nina Pavcnik & Petia Topalova, 2010. "Imported Intermediate Inputs and Domestic Product Growth: Evidence from India," The Quarterly Journal of Economics, Oxford University Press, vol. 125(4), pages 1727-1767.
    20. Susan Stone & James Messent & Dorothee Flaig, 2015. "Emerging Policy Issues: Localisation Barriers to Trade," OECD Trade Policy Papers 180, OECD Publishing.
    21. Avi Goldfarb & Daniel Trefler, 2018. "AI and International Trade," NBER Working Papers 24254, National Bureau of Economic Research, Inc.
    22. Aaditya Mattoo & Joshua P Meltzer, 2018. "International Data Flows and Privacy: The Conflict and Its Resolution," Journal of International Economic Law, Oxford University Press, vol. 21(4), pages 769-789.
    23. Dale W. Jorgenson & Mun S. Ho & Jon D. Samuels, 2012. "Information Technology and US Productivity Growth: Evidence from a Prototype Industry Production Account," Chapters, in: Matilde Mas & Robert Stehrer (ed.), Industrial Productivity in Europe, chapter 2, Edward Elgar Publishing.
    24. Andrea Andrenelli & Charles Cadestin & Koen De Backer & Sébastien Miroudot & Davide Rigo & Ming Ye, 2018. "Multinational production and trade in services," OECD Trade Policy Papers 212, OECD Publishing.
    25. Caroline Freund & Diana Weinhold, 2002. "The Internet and International Trade in Services," American Economic Review, American Economic Association, vol. 92(2), pages 236-240, May.
    26. Pinelopi Goldberg & Amit Khandelwal & Nina Pavcnik & Petia Topalova, 2009. "Trade Liberalization and New Imported Inputs," American Economic Review, American Economic Association, vol. 99(2), pages 494-500, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Martina Francesca Ferracane & Janez Kren & Erik van der Marel, 2020. "Do data policy restrictions impact the productivity performance of firms and industries?," Review of International Economics, Wiley Blackwell, vol. 28(3), pages 676-722, August.
    2. Beverelli, Cosimo & Fiorini, Matteo & Hoekman, Bernard, 2017. "Services trade policy and manufacturing productivity: The role of institutions," Journal of International Economics, Elsevier, vol. 104(C), pages 166-182.
    3. Xiying Zhang & Yihuan Wang, 2022. "Research on the Influence of Digital Technology and Policy Restrictions on the Development of Digital Service Trade," Sustainability, MDPI, vol. 14(16), pages 1-16, August.
    4. Matteo Fiorini & Bernard Hoekman & Clément Malgouyres, 2018. "Services policy reform and manufacturing employment: Evidence from transition economies," The World Economy, Wiley Blackwell, vol. 41(9), pages 2320-2348, September.
    5. Matteo Fiorini & Bernard Hoekman, 2020. "EU services trade liberalization and economic regulation: Complements or substitutes?," The Review of International Organizations, Springer, vol. 15(1), pages 247-270, January.
    6. Roy, Martin, 2019. "Elevating services: Services trade policy, WTO commitments, and their role in economic development and trade integration," WTO Staff Working Papers ERSD-2019-01, World Trade Organization (WTO), Economic Research and Statistics Division.
    7. Stefania Lovo & Gonzalo Varela, 2022. "Internationally Linked Firms and Productivity in Pakistan: A Look at the Top End of the Distribution," Journal of Development Studies, Taylor & Francis Journals, vol. 58(10), pages 2110-2131, October.
    8. Omar Bamieh & Francesco Bripi & Matteo Fiorini, 2022. "Services trade and labor market outcomes: Evidence from Italian firms," Review of International Economics, Wiley Blackwell, vol. 30(3), pages 673-701, August.
    9. Agnes Kügler & Andreas Reinstaller & Klaus Friesenbichler, 2022. "Can Value Chain Integration Explain the Diverging Economic Performance within the EU?," WIFO Working Papers 650, WIFO.
    10. Maria Bas, 2013. "Does Services Liberalization Affect Manufacturing Firms' Export Performance? Evidence from India," Working Papers 2013-17, CEPII research center.
    11. Sèna Kimm Gnangnon, 2021. "Development aid and services export diversification," International Journal of Economic Policy Studies, Springer, vol. 15(1), pages 125-156, February.
    12. Erik van der Marel, 2020. "Sources of Comparative Advantage in Data-Related Services," RSCAS Working Papers 2020/30, European University Institute.
    13. Sèna K. Gnangnon, 2021. "Aid for Trade and services export diversification in recipient countries," Australian Economic Papers, Wiley Blackwell, vol. 60(2), pages 189-225, June.
    14. Xinyu Hou & Yingying Shi & Puyang Sun, 2021. "Foreign Entry Liberalization And Export Quality: Evidence From China," Contemporary Economic Policy, Western Economic Association International, vol. 39(1), pages 205-219, January.
    15. Erik Marel, 2017. "Explaining Export Performance through Inputs: Evidence from Aggregated Cross-country Firm-level Data," Review of Development Economics, Wiley Blackwell, vol. 21(3), pages 731-755, August.
    16. Jun Du & Oleksandr Shepotylo, 2022. "UK trade in the time of COVID‐19: A review," The World Economy, Wiley Blackwell, vol. 45(5), pages 1409-1446, May.
    17. Pol Antràs & Davin Chor, 2021. "Global Value Chains," NBER Working Papers 28549, National Bureau of Economic Research, Inc.
    18. Lovo,Stefania & Varela,Gonzalo J., 2020. "Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan," Policy Research Working Paper Series 9349, The World Bank.
    19. Ferracane,Martina Francesca & Van Der Marel,Erik Leendert, 2020. "Digital Innovation in East Asia : Do Restrictive Data Policies Matter," Policy Research Working Paper Series 9124, The World Bank.
    20. Gnangnon, Sèna Kimm, 2020. "Aid for Trade and Services Export Diversification in Recipient-Countries," EconStor Preprints 210467, ZBW - Leibniz Information Centre for Economics.

    More about this item

    Keywords

    Trade; Services; Data flows; Digital technology; Regulations;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F68 - International Economics - - Economic Impacts of Globalization - - - Policy
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:weltar:v:157:y:2021:i:4:d:10.1007_s10290-021-00417-2. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.