2006
DOI: 10.1093/ei/cbj026
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Has the Internet Increased Trade? Developed and Developing Country Evidence

Abstract: Developing countries export more to developed, but not other developing countries, when Internet penetration is higher. Although this could be because Internet penetration stimulates exports, it could also be because trade openness encourages Internet use. To test the direction of causation, we allow Internet use to be determined endogenously using countries' regulation of data services as an instrument. The results suggest that access to the Internet does improve export performance in developing countries, al… Show more

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Cited by 196 publications
(153 citation statements)
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“…The findings are consistent with the general consensus that internet expansion promotes international trade and reduces communication and transaction costs with the aid of more efficient logistics and warehousing (Venables 2001;Freund and Weinhold 2004;Clarke and Wallsten 2006;Liu and Nath 2013). For instance, Freund and Weinhold (2004) find that growth of the number of internet hosts by 10 percentage points boosts a country's exports by 0.2 percentage points, while Clarke and Wallsten (2006) indicate that a higher internet penetration rate in developing economies improves export performance from developing economies to developed economies. Liu and Nath (2013) find that internet subscriptions and web hosts have a positive and significant effect on exports in emerging market economies.…”
Section: Empirical Results: Full Sample Analysissupporting
confidence: 86%
See 2 more Smart Citations
“…The findings are consistent with the general consensus that internet expansion promotes international trade and reduces communication and transaction costs with the aid of more efficient logistics and warehousing (Venables 2001;Freund and Weinhold 2004;Clarke and Wallsten 2006;Liu and Nath 2013). For instance, Freund and Weinhold (2004) find that growth of the number of internet hosts by 10 percentage points boosts a country's exports by 0.2 percentage points, while Clarke and Wallsten (2006) indicate that a higher internet penetration rate in developing economies improves export performance from developing economies to developed economies. Liu and Nath (2013) find that internet subscriptions and web hosts have a positive and significant effect on exports in emerging market economies.…”
Section: Empirical Results: Full Sample Analysissupporting
confidence: 86%
“…With a fixed-effect model approach, the study finds that adoptions of fixed line telephones, mobile phones, and internet connection in the exporting countries have significant impact on US imports of differentiated goods, indicating that a 10% rise in exporter's internet adoption rate increases the total exports of goods to the US by 1 %. By utilising cross-sectional data on the total exports of goods in 2001 for 26 developed countries and 72 developing countries, Clarke and Wallsten (2006) find that greater internet penetration promotes trade flows from developing countries to developed countries, but no significant effect is found when the trade flow is from developed countries to developing countries. Vemuri and Siddiqi (2009) analyse the effect of ICT infrastructure and internet penetration on international trade for a panel of 64 countries between 1985 and 2005.…”
Section: Ict and International Tradementioning
confidence: 96%
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“…Similarly, Kurihara and Fukushima (2013) found Internet prevalence to be associated with international trade in Asia. In the context of developing countries, access to the Internet was shown to improve export performance (Clarke & Wallsten, 2006). Telecommunications creates an avenue to maintain quick and effective communication with trade partners to sustain trade competitiveness, hence supporting the hypothesis that: H4: Telecommunications infrastructure has a positive influence on intra-African trade.…”
Section: Ict Infrastructure (Telecommunications)mentioning
confidence: 71%
“…It is worth pointing out that the expansion of the Internet has provided the purchasing departments (especially supermarket chains) with direct access to exporters and all parties can now check the current situation of the business (Freund & Weinhold, 2000;Clarke & Wallsten, 2006).…”
Section: Discussionmentioning
confidence: 99%