International agreements on cross-border data flows and international trade
A statistical analysis
This report uses a state-of-the-art gravity model to analyse the effects of selected
international data agreements on bilateral trade flows in goods and services for the
years 1995-2012. International data agreements can foster cross-border transactions
by enhancing consumer trust and the interoperability of national regulatory frameworks,
providing legal clarity for firms operating in distinct jurisdictions. Yet they can
also involve compliance costs and restrictions on the free flow of data, potentially
creating trade barriers. The report sheds light on these issues by examining how entering
an international data agreement (e.g. the EU Data Protection Directive, the EU-US
and Switzerland-US Safe Harbor agreements or the Council of Europe Convention 108)
affects trade among participating countries relative to trade with or among non-participating
countries. The results suggest that entering such agreements has a statistically significant
and robust effect on trade, though this effect can vary according to the nature of
the agreement.
Published on October 12, 2020
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