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Distance Isn’t Quite Dead: Recent Trade Patterns and Modes of Supply in Computer and Information Services in the United States and NAFTA Partners

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  • Jacob Funk Kirkegaard

    () (Peterson Institute for International Economics)

Abstract

This paper evaluates the statistical strengths and weaknesses of available data on US computer and information services trade and estimates the scope of delivery through GATS modes 1, 3, and 4. Trade values are estimated using a new methodology that adheres, to the greatest extent possible, to the definitions of modes of supply in the 2002 Manual on Statistics of International Trade in Services. This paper finds that US trade (particularly exports) in computer and information services are overwhelmingly and increasingly delivered through mode 3. The United States is found to have experienced declining overall revealed comparative advantage (RCA) in traditional mode 1 cross-border computer and information services trade from 1986 to 2006, while having a stable, positive RCA in mode-3 trade. A new methodology for tentatively estimating US imports of computer and information services in GATS mode 4 suggests that the IT services sector dominates US mode-4 imports, and that these are several times larger than US traditional mode-1, cross-border imports of computer and information services.

Suggested Citation

  • 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.
  • Handle: RePEc:iie:wpaper:wp08-10
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    More about this item

    Keywords

    US computer and information services trade; Services trade data validity; GATS modes of supply; Revealed comparative advantage;

    JEL classification:

    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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