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Digital Trade, Data Protection and the EU Adequacy Club

Author

Listed:
  • Ferracane, Martina F.
  • Hoekman, Bernard
  • van der Marel, Erik
  • Santi, Filippo

Abstract

Between 2000 and 2020, the EU granted so-called adequacy status to 13 states or territories, permitting EU citizens’ personal data to flow freely between the EU and the respective trading partners, including between countries accorded adequacy, creating a de facto (discriminatory) club. Adequacy decisions are unilateral, complementing more commonly observed and analyzed mutual recognition arrangements for technical regulations. We use structural gravity and synthetic control methods to assess the relationship between EU adequacy decisions and digital trade, using different approaches to define digital trade. We find that adequacy increases bilateral digital trade, driven to an important extent by EU-US agreements. We also show that digital trade between adequacy-receiving countries increases, providing evidence of a ‘club effect’ associated with EU adequacy decisions.

Suggested Citation

  • Ferracane, Martina F. & Hoekman, Bernard & van der Marel, Erik & Santi, Filippo, 2025. "Digital Trade, Data Protection and the EU Adequacy Club," CEPR Discussion Papers 19882, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:19882
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    File URL: https://cepr.org/publications/DP19882
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    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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