Examining National Privacy Laws in the Context of International Trade

Abstract

In recent years, multiple government officials, members of civil society, industry representatives, and academic scholars have suggested that a direct relationship exists between a country’s data privacy framework and international trade prospects. However, quantitative research in this field is still nascent. Therefore, this thesis explores the relationship between countries’ data privacy laws and annual commercial services exports and imports. I hypothesize that a positive correlation exists between privacy laws and international trade: I predict that countries or territories with stronger national privacy laws are likely to see higher levels of commercial services exports and imports, holding constant various control factors. Using demographic and international trade data from the World Bank and the World Trade Organization, I adopt linear and fixed-effects regression models to analyze national data privacy frameworks from 202 countries or territories between 2005 and 2018. I find that the results of this study generally support my hypothesis, although I underscore the limitations of these findings, including missing data and uncontrollable confounding variables. Finally, I offer conclusions and policy recommendations based on my preliminary analysis and offer support for further research into this topic.