ICT and Exporting: The Effects of Broadband on the Extensive Margin of Business Service Exports

40 Pages Posted: 4 Aug 2016

See all articles by Richard Kneller

Richard Kneller

University of Nottingham

Jonathan Timmis

Organization for Economic Co-Operation and Development (OECD) - Directorate for Science, Technology and Industry (STI)

Date Written: September 2016

Abstract

Over the last three decades the global economy has witnessed rapid growth of international trade in services. This has been particularly true of service‐intensive countries such as the UK. Developments in information and communication technologies are an obvious explanation for this. We provide empirical evidence for the effects of broadband use on the firm‐extensive margin of UK service exports. To deal with the issue of causality we build a novel instrument that exploits exogenous variation in access to broadband technologies owing to the historic telephone network. We find evidence for a causal effect from the Internet on trade in business services, but no evidence for an effect on trade in services more generally.

Suggested Citation

Kneller, Richard and Timmis, Jonathan, ICT and Exporting: The Effects of Broadband on the Extensive Margin of Business Service Exports (September 2016). Review of International Economics, Vol. 24, Issue 4, pp. 757-796, 2016. Available at SSRN: https://ssrn.com/abstract=2818099 or http://dx.doi.org/10.1111/roie.12237

Richard Kneller (Contact Author)

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

Jonathan Timmis

Organization for Economic Co-Operation and Development (OECD) - Directorate for Science, Technology and Industry (STI)

Paris
France

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