The impacts of ict and globalízatíon on trade ín servíces

• Author: Dr. Yusuf Bayraktutan/Dr. Íbrahim Arslan
• Position: Assoc. Prof. of Economics Kocaeli University IIBF Umuttepe/Kocaeli/Assis. Prof. of Economics Gaziantep University, IIBF Department of Logistics
• Pages: 359-365

Page 359

1. Introduction

In the global economy, a series of changes has increased the importance of developments in internet and communication technologies (ICT) . Development in ICT after 1990s have caused service mobility composing an indispensable infrastructure. The difference between trade in goods and services have been disappeared. Services look for an infrastructure to mobilize. Telecommunication networks and widening internet made it possible for some service sectors, such as education, health, engeneering, banking and entertainment, etc. to be tradable. Thus, people will have the knowledge about the quality and price of the goods and services in any country in the world.

This process is picking up speed in last years making the world a place where standardized goods and services are put into use by means of decreasing prices and increasing the quality and efficiency. The purpose of this study is to show the importance of ICT in service trade, and how it could be accomplished to make services globally available and marketable.

Page 360

2. A Breief Survey of the Related Literature

Basic theory suggests that after a trade reform, workers in industries which lack a comparative advantage will lose out, while those based in sectors with a comparative advantage will gain. The openning process brings more opportunities to access comparative intermediate goods and capital goods that embody better technologies. It also stimulates productivity, better resource allocation, and exports, while giving local producers and consumers access to less expensive and higher quality goods from abroad (Yüceol, 2007: 16). In this process where formation of new standarts and developments in technology has improved the supply chains between consumers and distributors. Acceleration of knowledge sharing has lessened the time of learning and specialization as well. Developments in IT has provided widening of markets and increase the limits of the capacity. Product life curves are so short in innovative markets means that markets continuously live the growing phase instead of deterioration and stagnation (Bayraktutan, 2003). Growing phase of the market and the risk of new entrances increases the motivation of innovation of existing firms (Yílmaz, 2003: 33).

Recent literature surveys document the large potential gains from liberalization of trade in communications, finance, transport, and other services (Hoekman, 2006). Moreover, even exploiting the opportunities arising from liberalization of trade in goods will require better services (Hoekman, and Matto, 2007: 399-418). The growth of the service sectors in advanced economies, as measured by rates of change in sales, value-added, or employment, has exceeded that of the goods-producing industries for several decades. Furthermore, for at least the first half of the 1980s, the number of jobs in goods producing industries in Canada and the United States actually declined: all of the net increase in employment during this period was accounted for by service industries (Stabler, and Howe, 1993: 30).

The liberalization of trade in services could also have impact on the international trade of goods. International trade in goods requires inputs from several service industries, such as transportation, insurance, and finance in order to complete and facilitate international transactions. Restrictions on the ability of national service providers to provide these services across borders and within foreign countries create additional costs that might limit the international flow of trade in goods. Elimination of these restrictions, then, should provide a boost to the international trade of goods. There are not...