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International tradability indices for services

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  • van der Marel, Erik
  • Shepherd, Ben

Abstract

This paper uses a theoretically grounded model of international trade to estimate the cross-border tradability of services. The resulting indices cover up to 99 countries and ten sectors. The results show that information and communications technology capital and legal institutions are particularly important determinants of a country's ability to successfully export services. The tradability indices are strongly correlated with outcome indicators, such as trade shares of individual countries. In addition, they are strongly correlated with important inputs, including country productivity and size, factor endowments, trade costs, and regulatory measures. In particular, the results suggest that a more restrictive regulatory environment significantly reduces the international tradability of services.

Suggested Citation

  • van der Marel, Erik & Shepherd, Ben, 2013. "International tradability indices for services," Policy Research Working Paper Series 6712, The World Bank.
    • Handle: RePEc:wbk:wbrwps:6712
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    References listed on IDEAS

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    1. Costinot, Arnaud, 2009. "On the origins of comparative advantage," Journal of International Economics, Elsevier, vol. 77(2), pages 255-264, April.
    2. John Romalis, 2004. "Factor Proportions and the Structure of Commodity Trade," American Economic Review, American Economic Association, vol. 94(1), pages 67-97, March.
    3. Andrei A. Levchenko, 2007. "Institutional Quality and International Trade," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 74(3), pages 791-819.
    4. J. Bradford Jensen & Lori G. Kletzer, 2005. "Tradable Services: Understanding the Scope and Impact of Services Outsourcing," Working Paper Series WP05-9, Peterson Institute for International Economics.
    5. van der Marel, Erik, 2011. "Determinants of comparative advantage in services," LSE Research Online Documents on Economics 38993, London School of Economics and Political Science, LSE Library.
    6. Chor, Davin, 2010. "Unpacking sources of comparative advantage: A quantitative approach," Journal of International Economics, Elsevier, vol. 82(2), pages 152-167, November.
    7. Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2008. "Estimating Trade Flows: Trading Partners and Trading Volumes," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(2), pages 441-487.
    8. Ingo Borchert & Batshur Gootiiz & Aaditya Mattoo, 2014. "Policy Barriers to International Trade in Services: Evidence from a New Database," The World Bank Economic Review, World Bank, vol. 28(1), pages 162-188.
    9. Joseph Francois & Olga Pindyuk, 2013. "Consolidated Data on International Trade in Services," IIDE Discussion Papers 20130101, Institue for International and Development Economics.
    10. Borchert, Ingo & Gootiiz, Batshur & Mattoo, Aaditya, 2012. "Guide to the services trade restrictions database," Policy Research Working Paper Series 6108, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Nazire Nergiz Dincer & Ayça Tekin‐Koru, 2020. "The effect of border barriers to services trade on goods trade," The World Economy, Wiley Blackwell, vol. 43(8), pages 2093-2118, August.
    2. Jean Bosco Harelimana & Beline Mukarwego, 2021. "Service Sector as an Engine of Growth: Empirical Analysis of Rwanda," Business and Management Studies, Redfame publishing, vol. 7(2), pages 47-59, June.
    3. Uwitonze, Eric & Heshmati, Almas, 2016. "Service Sector Development and its Determinants in Rwanda," IZA Discussion Papers 10117, Institute of Labor Economics (IZA).
    4. Hausmann, Ricardo & Espinoza, Luis & Santos, Miguel Angel, 2016. "Shifting Gears: A Growth Diagnostic of Panama," Working Paper Series rwp16-045, Harvard University, John F. Kennedy School of Government.
    5. Akihiko Shinozaki & Shigehiro Kubota, 2018. "The Role of Cross-Border Networks of Skilled Labor in Offshore Outsourcing: Empirical Evidence Based on the Network Theory," The Review of Socionetwork Strategies, Springer, vol. 12(2), pages 153-165, December.
    6. Ben Shepherd, 2019. "Productivity and Trade Growth in Services: How Services Helped Power Factory Asia," Working Papers id:12975, eSocialSciences.
    7. Khatiwada, Sameer & Flaminiano, John Paul, 2019. "Prospects for Decent Work in Services," ADBI Working Papers 940, Asian Development Bank Institute.

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    More about this item

    Keywords

    Economic Theory&Research; Trade and Services; Free Trade; ICT Policy and Strategies; Trade Law;
    All these keywords.

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