The Impact of Digital Economy on International Trade - A Cross-Border E-Commerce Based Perspective

Score of the Digital Economy Development Level of RCEP Countries

Country	2012	2017	2021	Average value 2012-2021	Ranking
Singapore	88.99	96.28	100	92.08	1
Korea	75.77	82.92	95.40	79.73	2
Japan	67.97	77.72	85.37	71.42	3
Malaysia	63.27	76.55	82.59	69.91	4
Australia	61.95	71.21	74.57	65.59	5
New Zealand	62.19	68.62	75.06	63.65	6
China	52.38	70.11	81.49	59.03	7
Philippines	46.75	60.73	73.68	54.56	8
Vietnam	31.96	53.65	77.67	42.49	9
Thailand	31.96	47.23	58.52	41.75	10
Brunei	34.56	44.83	48.06	35.37	11
Indonesia	26.97	39.26	47.39	32.37	12
Laos	18.42	29.92	46.58	24.84	13
Cambodia	14.44	19.23	33.25	15.75	14
Myanmar	2.35	17.02	26.62	12.72	15
Average	-	-	-	50.75	-

Average annual growth rate of digital economy development level

Country	2012-2021 Annual growth rate (%)
Singapore	1.54
Korea	3.05
Japan	4.18
Malaysia	2.03
Australia	2.48
New Zealand	4.71
China	5.97
Philippines	4.69
Vietnam	11.45
Thailand	3.48
Brunei	7.12
Indonesia	4.96
Laos	8.26
Cambodia	15.38
Myanmar	4.75

Foreign trade high-quality development indicators measurement

Primary index	Secondary index	Index description	Units	Weight
Innovate	R&D investment rate	R&D expenditure /GDP	%	7.218
Coordinate	Foreign trade regional structure deviation coefficient	|Yi-Y|,Yi:Total import and export trade of the city /GDP,Y:Total import and export trade of the province /GDP	%	0.793
	Trade balance between imports and exports	Import/export value	%	13.31
Green	Carbon emission	Carbon emission	10,000 tons	2.195
Open	Trade competitiveness	(Export value - import value)/Total import and export value	%	2.641
	Ratio of dependence on foreign trade	Total import and export value/GDP	%	18.834
Share	Per capita foreign trade volume	Total imports and exports/total population	$10,000 per person	28.149
	Contribution rate of trade employment	Total employment * Total exports /GDP	%	26.860

Unit root test

Variable	LLC	FisherADF	Hadri
TC1	-9.9771***(0.0000)	-9.3532***(0.0000)	9.3577***(0.0000)
TC2	-6.5425***(0.0000)	-9.0281***(0.0000)	13.8558***(0.0000)
de	-1.2333(0.1088)	3.6272***(0.0000)	14.8976***(0.0000)
is	-7.2208***(0.0000)	-8.5168***(0.0000)	7.0508***(0.0000)
en	-5.3355***(0.0000)	-7.6271***(0.0000)	8.9593***(0.0000)
fdi	-5.7138***(0.0000)	-5.6060***(0.0014)	7.9480***(0.0000)
rd	-8.0412***(0.0000)	-2.9841***(0.0000)	17.7094***(0.0000)
sca	-12.7881***(0.0000)	-8.7710***(0.0000)	14.6703***(0.0000)
gtfp	6.6553*(0.0511)	2.8029***(0.0000)	13.6017***(0.0000)
gtp	-3.4548***(0.0004)	1.8039***(0.0000)	16.9318***(0.0000)

RCEP foreign trade quality development level index and ranking (2020-2021)

Country	2020	Ranking	2021	Ranking	2022	Ranking
Singapore	0.917	1	0.968	1	0.983	1
Korea	0.902	2	0.967	2	0.788	4
Japan	0.709	5	0.922	3	0.916	2
Malaysia	0.537	7	0.814	4	0.785	5
Australia	0.743	4	0.597	7	0.772	6
New Zealand	0.705	6	0.75	6	0.625	8
China	0.826	3	0.801	5	0.839	3
Philippines	0.213	13	0.412	10	0.628	7
Vietnam	0.491	9	0.309	11	0.488	12
Thailand	0.406	10	0.247	13	0.552	10
Brunei	0.341	11	0.515	8	0.483	13
Indonesia	0.493	8	0.304	12	0.618	9
Laos	0.224	12	0.474	9	0.445	14
Cambodia	0.154	15	0.201	14	0.532	11
Singapore	0.182	14	0.059	15	0.316	15

The core variable replaces the regression result

	High income	Upper middle income	Low and middle income
	lnTRA	lnIM	lnTX
DIG2	1.521***	2.132***	0.876*
	(3.77)	(3.12)	(1.79)
lnGDP	0.161***	0.127	0.235***
	(3.04)	(1.42)	(3.65)
lnDIS	-0.116	-0.254*	-0.0518
	(-1.33)	(-1.72)	(-0.48)
ECO	0.0122	-0.00323	0.0291**
	(1.18)	(-0.19)	(2.33)
OPEN	0.00888***	0.158***	0.00346*
	(5.84)	(6.18)	(1.88)
_cons	2.784***	3.194*	0.802
	(2.68)	(1.82)	(0.64)
N	110	110	110
R2	0.588	0.473	0.436
F	27.21	16.98	14.63
P	0.0000000000055	0.0000000059	0.00000012

Variable meaning and data source

Variable	Meaning	Data sources
TRAi,t	Total import and export trade between China and ASEAN countries in year t	UN Comtrade
IMi,t	China’s import volume from RCEP i countries in year t
EXi,t	China’s export volume to RCEP i countries in t year
DIGi,t	The development level of digital economy in RCEP i countries in t	Be calculated
GDPi,t	The difference in GDP per capita between China and RCEP i countries in t years	World Bank database
OPENi,t	Trade openness of RCEP i countries in t year
ECOi,t	RCEP i countries in t years of economic freedom	The Heritage Foundation
DISi,t	Geographical distance between RCEP i countries and China	CEPII Database

Lag one stage regression results

	High income	Upper middle income	Low and middle income
	lnTRA	lnIM	lnTX
L.DIG	1.898***	2.815***	0.942*
	(4.18)	(3.46)	(1.69)
lnGDP	0.192***	0.145	0.274***
	(3.28)	(1.39)	(3.83)
lnDIS	-0.06520	-0.238*	0.0442
	(-0.83)	(-1.69)	(0.46)
ECO	0.0232***	0.0134	0.0348***
	(2.69)	(0.88)	(3.28)
OPEN	0.0101***	0.0182***	0.00376***
	(6.77)	(6.74)	(2.03)
_cons	1.553	1.964	-0.498
	(1.61)	(1.14)	(-0.43)
N	100	100	100
R2	0.602	0.485	0.410
F	25.78	16.02	11.85
P	0.000000000096	0.0000000049	0.00000010

The Weight of Index of the Development Level of the Digital Economy

Primary index	Secondary index	Comentropy	Weight (%)	Weight total (%)
(A) digital infrastructure	(A1) Fixed broadband penetration	0.935	13.788	35.278
	(A2) Mobile broadband penetration	0.957	11.018
	(A3) Mobile cellular subscription rates	0.968	1.984
	(A4) Internet penetration rate	0.925	5.755
	(A5) Degree of Internet access in schools	0.954	2.733
(B) Digital development environment	(B1) Higher education enrolment rate	0.964	9.058	31.523
	(B2) Availability of the latest technology	0.913	2.526
	(B3) Availability of venture capital	0.92	2.211
	(B4) Protection of intellectual property rights	0.991	5.248
	(B5) Government purchases of high-tech products	0.903	2.280
	(B6) innovation ability	0.967	3.715
	(B7) Enterprise R&D expenditure	0.936	3.387
	(B8) Efficiency of dispute resolution in the legal system	0.926	3.098
(C) Digital industry competitiveness	(C1) The proportion of ICT products exported	0.929	15.428	33.199
	(C2) Proportion of ICT service exports	0.946	9.286
	(C3) Proportion of high-tech exports	0.935	8.485

RCEP foreign trade quality development level index and ranking (2016-2019)

Country	2016	Ranking	2017	Ranking	2018	Ranking	2019	Ranking
Singapore	0.99	1	0.979	1	0.919	1	0.899	1
Korea	0.963	3	0.829	4	0.839	3	0.746	2
Japan	0.702	6	0.834	3	0.859	2	0.614	4
Malaysia	0.764	4	0.846	2	0.574	6	0.736	3
Australia	0.966	2	0.598	8	0.679	5	0.505	5
New Zealand	0.698	7	0.718	7	0.52	9	0.403	8
China	0.74	5	0.822	5	0.558	7	0.454	7
Philippines	0.691	8	0.517	9	0.549	8	0.354	9
Vietnam	0.599	10	0.724	6	0.716	4	0.489	6
Thailand	0.464	13	0.323	11	0.511	10	0.27	10
Brunei	0.564	11	0.284	13	0.223	11	0.228	11
Indonesia	0.687	9	0.312	12	0.06	14	0.114	15
Laos	0.478	12	0.066	15	0.146	12	0.144	14
Cambodia	0.397	14	0.119	14	0.11	13	0.202	12
Myanmar	0.233	15	0.494	10	0.055	15	0.152	13

Analysis of the direct effect of digital economy on trade competitiveness

	Benchmark Model		Textual model
Variable	TC1	TC1	TC2	TC2
lde	0.138***	0.122***	0.122**	0.108***
	(0.0214)	(0.0231)	(0.0276)	(0.0298)
is		0.467***		0.404**
		(0.145)		(0.188)
en		-21.03***		19.61**
		(7.043)		(9.149)
fdi		1.324*		1.827**
		(0.684)		(0.889)
rd		1.566		1.265
		(3.168)		(4.118)
lsca		-0.0211		0.0523
		(0.0412)		(0.0537)
Constant term	0.663***	0.635*	0.538***	-0.142
	(0.0872)	(0.341)	(0.114)	(0.442)
Observed value	342	342	342	342

Grouping regression result

	High income	Upper middle income	Low and middle income
	lnTRA	lnTRA	lnTRA
DIG	1.165*	5.009***	0.894
	(1.88)	(3.77)	(0.55)
lnGDP	0.718	0.0430	1.188***
	(1.36)	(1.31)	(5.67)
lnDIS	-0.435	0.185	-0.0932
	(-0.88)	(1.62)	(-0.86)
ECO	0.00557	-0.00927	-0.0156
	(0.13)	(-0.52)	(-1.39)
OPEN	0.00915*	0.00108	0.00827***
	(1.95)	(0.24)	(2.98)
_cons	-1.647	4.331***	-4.525**
	(-0.37)	(3.27)	(-2.42)
N	23	34	56
R2	0.369	0.764	0.815
F	1.751	16.07	39.28
P	0.184	0.00000413	0.000000011

Empirical analysis index selection list

Index classification		Name of index	Data sources
Variable being explained	TS	Bilateral trade in services	OCED Database
Explaining variable	TIMG	Global Digital Economy Development Index	Chinese Academy of Social Sciences
	E_AGit	Gross national product per capita of EU countries	the World Bank
	C_AGit	GDP per capita of China’s service sector	the World Bank
	DISTit	geographical distance	CEPII Database
Control variable	E-OPENit	Openness of EU countries to trade in services	Calculated from UNCTAD database
	C-OPENt	China’s openness to trade in services	Calculated by Chinese Statistical Yearbook
	FDIt	Foreign direct investment in China from EU countries	China Statistical Yearbook
	OFDIt	China’s foreign direct investment in EU countries	China’s outward direct Investment Communique
	CPIt	Consumer price index of EU countries	UNCTAD Datebase
Mechanism variable	HCit	Human capital intensity	the World Bank
	INNit	Innovation ability	the World Bank
	TFit	Ease of trade	the World Bank

RCEP foreign trade quality development level index and ranking (2012-2015)

Country	2012	Ranking	2013	Ranking	2014	Ranking	2015	Ranking
Singapore	0.993	1	0.982	1	0.945	1	0.988	1
Korea	0.946	2	0.929	3	0.847	2	0.65	5
Japan	0.93	4	0.98	2	0.72	3	0.823	3
Malaysia	0.926	5	0.875	4	0.719	4	0.763	4
Australia	0.946	3	0.704	6	0.509	8	0.523	8
New Zealand	0.868	6	0.676	7	0.462	9	0.637	6
China	0.623	8	0.733	5	0.655	7	0.906	2
Philippines	0.467	10	0.674	8	0.197	11	0.541	7
Vietnam	0.493	9	0.589	9	0.418	10	0.465	9
Thailand	0.361	11	0.541	10	0.147	12	0.332	12
Brunei	0.336	12	0.086	15	0.709	5	0.216	15
Indonesia	0.794	7	0.249	13	0.659	6	0.272	13
Laos	0.108	14	0.5	11	0.032	15	0.232	14
Cambodia	0.194	13	0.459	12	0.081	14	0.337	11
Myanmar	0.039	15	0.157	14	0.117	13	0.452	10

Descriptive statistical analysis of each variable

Variable	Observed value	Average value	Standard deviation	Minimum value	Maximum value
TC1	360	0.209	0.335	-0.747	0.828
TC2	360	0.0905	0.326	-0.708	0.793
de	360	0.319	0.209	-0.0538	1.019
fdi	360	0.0188	0.0162	-0.0187	0.0818
is	360	0.251	0.165	0.0114	1.037
sca	360	8798	7815	300.61	39398
rd	360	0.0168	0.0112	0.00348	0.0646
en	360	0.00127	0.00122	0.00087	0.0111
gtfp	360	1.468	0.398	1.014	3.766
gtp	360	3652.730	5196.645	23	35826