Barriers to Digital Services Trade and Export Efficiency of Digital Services

Abstract

An international rules system on digital trade that can satisfy multilateral interest appeal has not been formed yet despite the rapid growth of digital services trade. Using the panel data of 39 countries from 2010 to 2019, this study applied the stochastic frontier gravity model to analyze the influence of five types of barriers to digital services trade on the export efficiency of digital services. The research results show that infrastructure and connectivity barriers had no significant effect on the export efficiency of digital services. The barriers to electronic transactions and other barriers that affected the trade of digital services were conducive to improving the export efficiency of digital services. In contrast, the barriers to payment systems and intellectual property rights had a restraining effect on the export efficiency of digital services. The results also show that most countries were more efficient when exporting digital services to their major trade partner countries, which indicates a demand-driven characteristic. Based on these conclusions, we propose five recommendations that are helpful to enhance the export efficiency of digital services.