TABLE OF CONTENTS ABSTRACT 4 INTRODUCTION 5 LITERATURE REVIEW 8 1. Situating digital trade 8 2. Labor and digital trade restriction 10 METHODOLOGY AND DATA 14 DISCUSSION 16 CONCLUSION 23 REFERENCES 25 3 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade ABSTRACT Is a countrys industrial sector a hindrance to digital trade? Although the importance of data flows in allowing global value chains is becoming more well recognised, less is understood about digital commerce and its consequences for the home economy. It is commonly considered that, like investments, the extent to which nations are prepared to liberalise markets and how institutions support ease of transactions determines digital trade. Incipient patterns based on new indications, on the other hand, appear to contradict this viewpoint. For example, the digital trade restrictiveness score indicates that, despite their polarising regime frameworks, China and India are both among the most restrictive. The scale of a countrys industrial sector, as well as traditional characteristics like the total size of its economy and political system, are connected with its openness or restrictions to digital trade, according to this article. The study examines crosssectional fiscal, labor, and trade data from 64 economies and shows that nations with a relatively large industrial worker force compared to their service labor force are more prosperous. The findings add to our understanding of the impact of digital trade, particularly in emerging markets. Perhaps labor markets are sluggish to adjust to globalisation, and restrictive regulations are mostly longterm solutions designed to preserve a weak industry from losing out (industrial sector). As a result, measures ostensibly promoting digital commerce must include the effects on employees and consider if a digital transformation is worth the associated economic disruptions. 4 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade INTRODUCTION International trade has always been driven by technology. As mobile and internet technologies reinvent corporate processes and supply chains, the worldwide movement of commodities has grown more dynamic and widespread in recent years. While it took Marco Polo and his brother years to travel the Silk Road, governments, corporations, and even individual merchants may today trade in large amounts with the touch of a button or a phone call. However, as digitisation opens up new possibilities for products and processes, it also poses a threat to the status quo in the labor market (Buttner and Muller 2018; Chinorackya and Corejova 2019). Digital trade, in particular, has shifted perceptions of product and service providers, making many old sectors outdated. As a result, many emerging and developing nations have enacted interventionist digital policies under the guise of safeguarding their budding businesses from foreign competition (Drake, Cerf, and Kleinwachter 2016; Foster and Azmeh 2020). Why is the fate of the manufacturing sector linked to digital trade? What role do industries play in digital commodity regulatory policies? Is the countrys industrial labor force a barrier to digital trade? It is commonly considered that, like investments, the extent to which nations are prepared to liberalise markets and how institutions support ease of transactions determines digital trade. Lowincome democracies are said to be more inclined to implement tariffs to compensate for difficulties in collecting taxes, among other things (Moutos 2003). On the other hand, varying levels of corruption have been proven to have a detrimental influence on trade, particularly among poor and middleincome nations (GilPareja, LlorcaVivero, and MartínezSerrano 2019). There is also widespread scholarly agreement that a countrys authoritarian or autocratic status has a considerable impact on its commerce, albeit the relationships direction is less definite (Banerji and Ghanem 1997; Dai 2002; Aidt and Gassebner 2010; Rosendorff and Shin 2015). 5 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade However, emerging trends based on new variables call into question the relationship between digital trade and traditional institutional drivers. For example, the digital trade restrictiveness index (DTRI) indicates that, despite their polarized regime structures, China and India are both among the most restrictive countries. The scale of a countrys industrial sector, as well as traditional characteristics like the total size of its economy or political system, is connected with its openness or restrictions to digital trade, according to this article. The study examines crosssectional fiscal, labor, and trade data from 64 economies and shows that nations with a high industrial labor force compared to their service sector are more likely to place severe rules on digital commerce and networkbased services. The findings add to our understanding of the impact of digital trade, particularly in emerging markets. Its likely that labor markets would react to globalization more slowly than expected, and that restrictive regulations will be implemented over time to safeguard a weak industry from losing out (industrial sector). If established economies have to face problems in dealing with the digital market, the challenges for emerging countries that rely on traditional sectors as the backbone of their growth trajectories are undoubtedly greater. The extent to which governments are prepared to open their digital marketplaces thus goes beyond economic models and has clear redistributive repercussions for individuals who are at danger of losing their livelihood. The following is the order in which the paper is presented. First, we review the existing literature on the digitization of goods and services, demonstrating that, while restrictive laws are often seen as welfaredefeating, there is no consensus on why states choose restrictive rules to other policy options. Following that, the study focuses on the theoretical logic of how the relative sizes of an economys industry and service sectors restrict government actions and, as a result, impact its openness to digital commerce. Following that, we go into the operational measures we employed to proxy the variables of interest, as well as the analytical technique we utilized to back up our hypothesis. Following then, a discussion of the conclusions based on the estimations takes place. The studys empirical findings are reiterated 6 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade in the conclusion, which has a number of consequences for both trade and labor policies. 7 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade LITERATURE REVIEW 1. Situating digital trade Until now, there has been no single agreed definition of what encompasses digital trade. According to LopezGonzales and Joanjean (2017), digital trade is a broad class of digitally enabled transactions involving goods and services which can either be digitally or physically delivered. This is actually the definition that the OECD has come to adopt. Others refer to it as a transaction that is largely commercial in nature performed remotely through electronic means (Daza Jaller, Gaillard, and Molinuevo 2020). Some also have defined digital trade as including both wide and specific sense, such as commerce in products and services delivered via the internet, as well as the enabling innovation and free flow of information in the digital environment (Burri and Polanco 2020). The challenge as to pinpoint exactly what digital trade entails also makes it difficult to assess its impact on a variety of policy sectors, including market access, trade, small businesses, government regulation, and data privacy (Fayyaz 2018). Attempts to define the breadth of digital trade and operationalize the scope and value of crossborder data flows have been made in recent years. To come up with a statistic that may be reflected in the gross domestic product, the US Department of Commerce uses the wholesale or retail trade margin the total money gained from only sales minus the cost of producing the goods or services offered through the electronic market (Barefoot, et al., 2018). On the other hand, the Organization for Economic Cooperation and Development uses a variety of methodologies, including expert judgment, anecdotal evidence, and observations based on the experience and results of comparable countries (OECD 2020). Many digital transactions, however, are still beyond the scope of trade statistics because no monetary transaction is involved. For example, blogs and usergenerated films produce large amounts of internet traffic but are unlikely to be reflected in national statistics because users do not pay for these services (Lund and Manyika 2016). Nevertheless, there seems to be united approval that regulatory interference in digital trading has become increasingly common. It was noted by Burri (2015) that the WTO had acknowledged the impact of digital technology on all sectors of trade, including intellectual property, as early as 1998, albeit arguments on digital trade at the time focused on services and their regulation. However, as hybrid products emerge, governments and multilateral bodies are under increasing pressure to promulgate regulations managing the digital economy in subsequent free trade agreements (Meltzer 2020). This is usually accomplished through international regulatory mechanisms such as the development of standards and mutual recognition agreements in areas like privacy and consumer protection (Neeraj 2019; Janow and Mavroidis 2019), or state regulatory instruments such as mandatory registration for foreign suppliers of crossborder digital goods and services (van Zyl 2014). Contract clauses committing companies to high security and privacy standards, audits and certifications of foreign suppliers, protections available in foreign suppliers local laws, and adherence to international agreements and standards on transactionrelated issues, as well as reputational sanctions, are all available at the firm level (Chander and Le 2017). Its reasonable that governments around the world are wary of digital trade. Many parts of the digital market are dominated by technology companies, whose oligopolistic position makes it difficult for new players to enter (Neeraj 2019). Some of these businesses are gaining market share at a higher rate than their ostensibly related industries. Digital transactions are also removed from the taxing economy due to the absence of physical presence as when data is collected in one place, then processed or stored in another (Ahmed and Chander 2015). The ubiquitous exchange of data across borders has only surged concerns about digital security, audit capacity, and individual privacy protection, prompting many governments to enact even more regulatory measures, such as imposing conditions on crossborder data transfers or requiring companies to store data locally for audit and security purposes (Lopez Gonzales and Joanjean 2017).
FOREIGN TRADE UNIVERSITY FALCUTY OF INTERNATIONAL BUSINESS AND ECONOMICS -***** - RESEARCH PAPER SUBJECT: INTERNATIONAL BUSINESS TOPIC: THE RELATIONSHIP BETWEEN LABOR AND DIGITAL TRADE Foreign Trade University Group 12 Topic: The relationship between labor and digital trade 2|Page The relationship between labor and digital trade Foreign Trade University Group 12 The relationship between labor and digital trade TABLE OF CONTENTS ABSTRACT INTRODUCTION .5 LITERATURE REVIEW Situating digital trade Labor and digital trade restriction 10 METHODOLOGY AND DATA 14 DISCUSSION 16 CONCLUSION 23 REFERENCES 25 3|Page Foreign Trade University Group 12 The relationship between labor and digital trade ABSTRACT Is a country's industrial sector a hindrance to digital trade? Although the importance of data flows in allowing global value chains is becoming more well recognised, less is understood about digital commerce and its consequences for the home economy It is commonly considered that, like investments, the extent to which nations are prepared to liberalise markets and how institutions support ease of transactions determines digital trade Incipient patterns based on new indications, on the other hand, appear to contradict this viewpoint For example, the digital trade restrictiveness score indicates that, despite their polarising regime frameworks, China and India are both among the most restrictive The scale of a country's industrial sector, as well as traditional characteristics like the total size of its economy and political system, are connected with its openness or restrictions to digital trade, according to this article The study examines cross-sectional fiscal, labor, and trade data from 64 economies and shows that nations with a relatively large industrial worker force compared to their service labor force are more prosperous The findings add to our understanding of the impact of digital trade, particularly in emerging markets Perhaps labor markets are sluggish to adjust to globalisation, and restrictive regulations are mostly long-term solutions designed to preserve a weak industry from losing out (industrial sector) As a result, measures ostensibly promoting digital commerce must include the effects on employees and consider if a digital transformation is worth the associated economic disruptions 4|Page Foreign Trade University Group 12 The relationship between labor and digital trade INTRODUCTION International trade has always been driven by technology As mobile and internet technologies reinvent corporate processes and supply chains, the worldwide movement of commodities has grown more dynamic and widespread in recent years While it took Marco Polo and his brother years to travel the Silk Road, governments, corporations, and even individual merchants may today trade in large amounts with the touch of a button or a phone call However, as digitisation opens up new possibilities for products and processes, it also poses a threat to the status quo in the labor market (Buttner and Muller 2018; Chinorackya and Corejova 2019) Digital trade, in particular, has shifted perceptions of product and service providers, making many old sectors outdated As a result, many emerging and developing nations have enacted interventionist digital policies under the guise of safeguarding their budding businesses from foreign competition (Drake, Cerf, and Kleinwachter 2016; Foster and Azmeh 2020) Why is the fate of the manufacturing sector linked to digital trade? What role industries play in digital commodity regulatory policies? Is the country's industrial labor force a barrier to digital trade? It is commonly considered that, like investments, the extent to which nations are prepared to liberalise markets and how institutions support ease of transactions determines digital trade Low-income democracies are said to be more inclined to implement tariffs to compensate for difficulties in collecting taxes, among other things (Moutos 2003) On the other hand, varying levels of corruption have been proven to have a detrimental influence on trade, particularly among poor and middle-income nations (Gil-Pareja, Llorca-Vivero, and Martínez-Serrano 2019) There is also widespread scholarly agreement that a country's authoritarian or autocratic status has a considerable impact on its commerce, albeit the relationship's direction is less definite (Banerji and Ghanem 1997; Dai 2002; Aidt and Gassebner 2010; Rosendorff and Shin 2015) 5|Page Foreign Trade University Group 12 The relationship between labor and digital trade However, emerging trends based on new variables call into question the relationship between digital trade and traditional institutional drivers For example, the digital trade restrictiveness index (DTRI) indicates that, despite their polarized regime structures, China and India are both among the most restrictive countries The scale of a country's industrial sector, as well as traditional characteristics like the total size of its economy or political system, is connected with its openness or restrictions to digital trade, according to this article The study examines crosssectional fiscal, labor, and trade data from 64 economies and shows that nations with a high industrial labor force compared to their service sector are more likely to place severe rules on digital commerce and network-based services The findings add to our understanding of the impact of digital trade, particularly in emerging markets It's likely that labor markets would react to globalization more slowly than expected, and that restrictive regulations will be implemented over time to safeguard a weak industry from losing out (industrial sector) If established economies have to face problems in dealing with the digital market, the challenges for emerging countries that rely on traditional sectors as the backbone of their growth trajectories are undoubtedly greater The extent to which governments are prepared to open their digital marketplaces thus goes beyond economic models and has clear redistributive repercussions for individuals who are at danger of losing their livelihood The following is the order in which the paper is presented First, we review the existing literature on the digitization of goods and services, demonstrating that, while restrictive laws are often seen as welfare-defeating, there is no consensus on why states choose restrictive rules to other policy options Following that, the study focuses on the theoretical logic of how the relative sizes of an economy's industry and service sectors restrict government actions and, as a result, impact its openness to digital commerce Following that, we go into the operational measures we employed to proxy the variables of interest, as well as the analytical technique we utilized to back up our hypothesis Following then, a discussion of the conclusions based on the estimations takes place The study's empirical findings are reiterated 6|Page Foreign Trade University Group 12 The relationship between labor and digital trade in the conclusion, which has a number of consequences for both trade and labor policies 7|Page Foreign Trade University Group 12 The relationship between labor and digital trade LITERATURE REVIEW Situating digital trade Until now, there has been no single agreed definition of what encompasses digital trade According to Lopez-Gonzales and Joanjean (2017), digital trade is a broad class of digitally enabled transactions involving goods and services which can either be digitally or physically delivered This is actually the definition that the OECD has come to adopt Others refer to it as a transaction that is largely commercial in nature performed remotely through electronic means (Daza Jaller, Gaillard, and Molinuevo 2020) Some also have defined digital trade as including both wide and specific sense, such as commerce in products and services delivered via the internet, as well as the enabling innovation and free flow of information in the digital environment (Burri and Polanco 2020) The challenge as to pinpoint exactly what digital trade entails also makes it difficult to assess its impact on a variety of policy sectors, including market access, trade, small businesses, government regulation, and data privacy (Fayyaz 2018) Attempts to define the breadth of digital trade and operationalize the scope and value of cross-border data flows have been made in recent years To come up with a statistic that may be reflected in the gross domestic product, the US Department of Commerce uses the wholesale or retail trade margin - the total money gained from only sales minus the cost of producing the goods or services offered through the electronic market (Barefoot, et al., 2018) On the other hand, the Organization for Economic Cooperation and Development uses a variety of methodologies, including expert judgment, anecdotal evidence, and observations based on the experience and results of comparable countries (OECD 2020) Many digital transactions, however, are still beyond the scope of trade statistics because no monetary transaction is involved For example, blogs and user-generated films produce large amounts of internet traffic but are unlikely to be reflected in national statistics because users not pay for these services (Lund and Manyika 2016) 8|Page Foreign Trade University Group 12 The relationship between labor and digital trade Nevertheless, there seems to be united approval that regulatory interference in digital trading has become increasingly common It was noted by Burri (2015) that the WTO had acknowledged the impact of digital technology on all sectors of trade, including intellectual property, as early as 1998, albeit arguments on digital trade at the time focused on services and their regulation However, as hybrid products emerge, governments and multilateral bodies are under increasing pressure to promulgate regulations managing the digital economy in subsequent free trade agreements (Meltzer 2020) This is usually accomplished through international regulatory mechanisms such as the development of standards and mutual recognition agreements in areas like privacy and consumer protection (Neeraj 2019; Janow and Mavroidis 2019), or state regulatory instruments such as mandatory registration for foreign suppliers of cross-border digital goods and services (van Zyl 2014) Contract clauses committing companies to high security and privacy standards, audits and certifications of foreign suppliers, protections available in foreign suppliers' local laws, and adherence to international agreements and standards on transaction-related issues, as well as reputational sanctions, are all available at the firm level (Chander and Le 2017) It's reasonable that governments around the world are wary of digital trade Many parts of the digital market are dominated by technology companies, whose oligopolistic position makes it difficult for new players to enter (Neeraj 2019) Some of these businesses are gaining market share at a higher rate than their ostensibly related industries Digital transactions are also removed from the taxing economy due to the absence of physical presence - as when data is collected in one place, then processed or stored in another (Ahmed and Chander 2015) The ubiquitous exchange of data across borders has only surged concerns about digital security, audit capacity, and individual privacy protection, prompting many governments to enact even more regulatory measures, such as imposing conditions on cross-border data transfers or requiring companies to store data locally for audit and security purposes (Lopez Gonzales and Joanjean 2017) 9|Page Foreign Trade University Group 12 The relationship between labor and digital trade From a social justice standpoint, digital trading also raises a can of worms Work in the digital labor market, for example, shares many features with other types of work that are deemed informal or precarious (Akhtar and Moore 2016), and taps into a large fraction of non-standard and transitory employment (Moore 2018) This has long been noted in the service sector (see, for example, Nelson 1994), but it is now beginning to characterize the contemporary digital labor market Collective bargaining, freedom of association, and the right to strike are frequently not available to workers in these arrangements (De Stefano 2016) Internet-mediated production is illegal in many developing and rising countries, leaving workers vulnerable to discrimination and underbidding (Graham, Hjorth, and Lehdonvirta 2017) Meanwhile, people who invisible work, such as filtering and editing social media information, are under a lot of mental and emotional strain (Cherry 2016) What appears to be the case is that digital trade and market digitization are ushering in new occupations while simultaneously eliminating others Although structural adaptation in the economy is not new, it has been a feature of civilizations since humans first learnt to trade In this light, restricting digital trade as a redistributive strategy is only logical for growing economies still reliant on many businesses that have been rendered unnecessary or redundant by digital markets Technology has altered the platform, but not the reason for states to engage in commerce Trade in the digital market, like traditional trade, is still governed by the logic of comparative advantage and is sensitive to labor market imbalances between the source and target economies Unfortunately, the existing literature barely mentions this viewpoint in passing Labor and digital trade restriction The theoretical conjecture in this paper is built from political economic theories based on labor factor mobility (Mayer 1984; Gilligan 1997; Hiscox 2001; Mukherjee, Smith, and Li 2009) and structural transformation (Kuznets 1973; 10 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade METHODOLOGY AND DATA To measure the amount of digital trade restriction implemented in each country the study used the Digital Trade Restrictiveness Index (DTRI) The figure was developed by the European Center for International Political Economy (ECIPE) and derived from hundreds of studies on policy measures of 64 countries According to Ferracane et al (2016), an increase in DTRI is directly correlated to the restrictiveness of the accounted economy to digital trade Table represents all components contributed to the index, from barriers to the flow of data to policy barriers, namely the domestic commercial environment Table 1: ECIPE’s digital trade restrictiveness index’s components The ratio of employment in the industry sector to that in the service sector, on the other hand, is calculated by dividing the industrial sector figure by the service sector data The International Labor Organization (ILO) provided the measures for both the industrial and service sectors, which equate to percentages of total employment According to the International Labor Organization, the industrial sector includes mining and quarrying, manufacturing, building, and public utilities (e.g., electricity, gas, and water) In contrast, the services sector includes wholesale and retail commerce, as well as restaurants and hotels; transportation, storage, and communications; financial, insurance, real estate, and business services; and communal, social, and personal services A rising number of these services are being made more accessible through digital transactions 14 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade We're particularly curious to see how the link might play out in the presence of political and economic variables that have been shown in the literature to impact non-tariff trade barriers We include governance-related variables based on the Worldwide Governance Indicators (WGI), the methodology for which is detailed in Kaufmann, Aart, and Mastruzzi (2010) Based on this metric, we employ the six main characteristics of governance: voice and accountability; political stability and lack of violence; government effectiveness; regulatory quality; rule of law; and corruption control Because the WGI are composite indices, they are subject to a variety of constraints (Langbein and Knack 2010) We also added Freedom House's categorical measure of democracy as a crude alternative We also took into account simple regulatory indicators like the number of processes needed to start a business and the time it takes for a firm to be able to conduct a business Because information and communications technology (ICT) is the primary platform via which digital trade is conducted, we also took into consideration the proportion of the population that uses the internet and the number of mobile users Finally, as economic controls, we included factors such as per capita GDP and unemployment as a proportion of total labor force To align the variables with the DTRI, all measures were calculated using 2016 data 15 | P a g e Foreign Trade University Group 12 The relationship between labor and digital trade DISCUSSION The primary variables of interest and the controls are illustrated in Table China (0.70) has the most restrictive economy, whereas New Zealand has the most liberal economy (0.09) In terms of restrictiveness, Russia comes in second (0.46) and India comes in third (0.44) The restrictiveness index for the United States is 0.26, which is surprisingly more restrictive than the average 0.24 for all 64 countries The ratio of industrial to services sector is less than or equal to one, and echoes the observation that the services sector is disproportionately dominating the modern economy (Buera and Kaboski 2012) A ratio near to one indicates that the industry sector is roughly equal in size to the service sector, implying that the industry sector is still significant and relevant in the face of digitalization The data shows that the average industry-services ratio is 0.36, indicating that the services sector is three times the size of the industry sector We expect governments to be more restrictive of digital trade in order to protect a reasonably large industry sector With 0.74 and 0.77, respectively, Vietnam and India have the highest industry-service labor ratios India is ranked third in terms of digital trade restrictiveness, while Vietnam is ranked fifth Figure shows the distribution of countries based on their industry-service labor ratio and DTRI score Although the plot looks to fit our hypothesized relationship, we delve deeper into this in the following section Variable Obs Mean Std.Dev Min Max Digital trade restrictiveness 64 0.244 0.104 0.090 0.700 Ratio of industry labor to services 63 0.358 0.149 0.137 0.777 Voice and accountability 0.642 0.803 -1.561 1.664 16 | P a g e 63 Foreign Trade University Political stability and absence of Group 12 The relationship between labor and digital trade 63 0.308 0.876 -2.483 1.519 Government effectiveness 63 0.859 0.789 -1.088 2.206 Regulatory quality 63 0.852 0.832 -1.018 2.181 Rule of law 63 0.751 0.904 -1.017 2.036 Control of corruption 63 0.687 1.002 -1.025 2.284 Mean Worldwide Governance 63 0.683 0.801 -1.041 1.862 63 0.724 0.195 0.124 0.982 Democracy (Y/N) 62 0.871 0.338 NO YES Mobiles users per 100 people 63 124.000 25.403 GDP per capita 63 26464 violence Index Percent of population using the internet 17 | P a g e 67.028 242.768 22247.86 1368.5 104278 Foreign Trade University Group 12 Unemployed as percent of total The relationship between labor and digital trade 63 0.071 0.046 0.007 0.266 64 0.375 0.488 NO YES 63 2.295 2.037 0.071 11.786 labor force No, of procedures to apply a business exceeds seven Weeks it takes to start a business Table 2: Descriptive summary (Sources: ECIPE, World Bank, and ILO (data retrieved on 10 August 2020)) 18 | P a g e Foreign Trade University Variables (1) Digital trade (1) (2) (3) (4) Group 12 (5) (6) (7) (8) The relationship between labor and digital trade (9) (10) (11) (12) (13) (14) (15) (16) 1.000 restrictiveness (2) Ratio of industry labor to services (0.000) (3) Voice and -0.643* -0.474* accountability (0.000) (0.000) (4) Political stability and absence of violence (5) Government -0.550* -0.384* 0.643* (0.000) (0.002) (0.000) -0.448* -0.426* 0.678* 0.764* effectiveness (0.000) (0.001) (0.000) (0.000) (6) Regulatory quality -0.598* -0.488* 0.730* 0.723* 0.941* (0.000) (0.000) (0.000) (0.000) (0.000) (7) Rule of law -0.514* -0.435* 0.760* 0.771* 0.971* 0.944* (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (8) Control of corruption -0.508* -0.502* 0.754* 0.740* 0.948* 0.925* 0.970* (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (9) Mean Worldwide Governance Index -0.588* -0.490* 0.822* 0.840* 0.960* 0.952* 0.981* 0.968* (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (10) Democracy (Y/N) -0.501* -0.265* 0.739* 0.207 0.121 0.229 0.227 0.228 0.312* (0.000) (0.038) (0.000) (0.109) (0.352) (0.076) (0.078) (0.077) (0.015) (11) % of population using the internet -0.485* -0.537* 0.616* 0.775* 0.851* 0.818* 0.836* 0.817* 0.854* 0.096 (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.459) (12) Mobile users per 100 People (log) -0.239 -0.263* 0.108 0.361* 0.307* 0.335* 0.256* 0.225 0.287* -0.179 0.328* (13) GDP per capita (log) (14) Unemployed as % of total labor force (15) Procedures to apply a business exceeds seven (16) Weeks it takes to start a business 0.528* 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 (0.059) (0.037) (0.405) (0.004) (0.015) (0.008) (0.045) (0.079) (0.024) (0.163) (0.009) -0.491* -0.619* 0.702* 0.758* 0.895* 0.869* 0.881* 0.880* 0.903* 0.182 0.901* 0.272* (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.000) (0.156) (0.000) (0.031) -0.019 -0.184 0.171 -0.012 -0.088 -0.098 -0.071 -0.078 -0.035 0.183 -0.006 -0.016 0.007 (0.882) (0.148) (0.185) (0.925) (0.494) (0.448) (0.585) (0.546) (0.788) (0.154) (0.960) (0.900) (0.958) 0.217 0.339* 0.445* (0.000) 0.449* (0.000) 0.443* (0.000) 0.443* (0.000) 0.440* (0.000) 0.452* (0.000) -0.212 (0.007) 0.378* (0.002) -0.003 (0.085) 0.268* (0.034) 0.522* (0.000) 0.363* 0.267* (0.003) (0.034) 0.353* (0.005) 0.340* (0.007) 0.599* (0.000) 0.606* (0.000) 0.570* (0.000) 0.546* (0.000) 0.546* (0.000) (0.980) -0.034 (0.791) 0.506* (0.000) * p