Transformations  in
Business & Economics

AN EMPIRICAL ANALYSIS OF TELECOMMUNICATION INFRASTRUCTURE PROMOTING THE SCALE OF INTERNATIONAL SERVICE TRADE: BASED ON THE PANEL DATA OF COUNTRIES ALONG THE BELT AND ROAD
Ji Chen, Jiayan Huang, Lingfang Zheng, Chonghui Zhang

ABSTRACT. This paper selects the trade costs as the intermediary variable, and probes the theoretical mechanism of telecommunication infrastructure to promote the development of international service trade. In theory, telecommunication infrastructure can effectively reduce the trade costs by means of the interaction of information elements, the innovation caused by talents and technological factors, the accumulation of resource elements, and so on, thereby promoting the development of international service trade. Based on panel data of 19 countries along the Belt and Road for 2007-2016, the paper tries to verify the significant mediating effect of trade costs by using the mediation effect test model and panel model. It is found that the development of telecommunication infrastructure can promote the development of international service trade in both the long and short term, while the export of international trade in services also provides a good economic environment for the telecommunication infrastructure. The research of this paper is of great significance for accelerating the construction of telecommunication infrastructure and promoting the development of international trade in countries along the Belt and Road .

KEYWORDS:  infrastructure, trade costs, international service trade, mediation effect, panel data.

JEL classification:  F14, O18, N70.