Digital Trade: Is Data Treaty-Ready?

Abstract

The knowledge-based and data-driven economy represents a new stage in the evolution of the economy, with transformative impacts on how goods and services are developed, produced, traded across borders, distributed, and consumed. Data is the essential capital of this new economic age as it enables the development of artificial intelligence, which drives the transformation of how technology transforms. The powerful network externalities and steep economies of scale and scope which characterize this new economic age raise economic governance concerns in terms of income distribution, corporate concentration, and the ability of countries to participate and capture benefits. Meanwhile, the power implicit in access to and control of data raises a plethora of concerns over personal privacy, social manipulation, influence over elections, and security. Since cross-border data flows are integral to international trade, trade agreements are entering into the regulation of data. However, as we are only at the dawn of this new era, it is a legitimate question as to whether the regulation of data is treaty-ready and what sorts of flexibilities need to be retained to enable appropriate policy responses as necessary.

Keywords: Digital Trade, Data, Artificial Intelligence, E-commerce

JEL Classification: F13, F15