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Better Together: How Digital Connectivity and Regulation Reduce Trade Costs
In this paper we study the impact of digitalization on trade costs in 58 economies over the period 2014 - 2018. Improvements in digital connectivity can reduce trade costs through multiple channels, including better access to information, lower transaction costs, the reduced need for business travel, more efficient customs and logistics, and easier communication. However, these positive effects depend on effective regulation that ensures trust in digital markets and open access to digital infrastructure, services and data.
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