The impact of information and communication technology (ICT) on international trade in agri-food products : a gravity approach

The rapid diffusion of information and communication technologies (ICT) is believed to be one of several important drivers of international trade and globalisation. The purpose of this dissertation was to analyse whether the three ICT - fixed telephone lines, mobile phones, and the internet - has encouraged international trade in important agri-food products. Gravity models of bilateral trade between countries were chosen to explain international trade. We used panel data of the values of bilateral trade between pairs of countries for the period 1995 to 2009. The empirical results from OLS and negative binomial regression estimation suggest that ICT has an effect on international trade in agri-food products. The impact is, however, not always strong and, contrary to expectations, it is often negative. For the products, 'wine' and 'fruit and vegetable juice', we found no effect of ICT on trade at all. Although there is great variation in the estimated impacts of individual ICT on international trade, the impact of mobile phones is somewhat stronger than that of fixed telephone lines and of the internet.