A study on the impact of global digital economy development on China’s export trade
DOI: https://doi.org/10.3846/tede.2026.25671Abstract
The rapid development of the global Digital Economy (DE) is profoundly affecting international trade and has emerged as a crucial engine sustaining the steady expansion of China’s export trade (CE). Drawing on panel data covering 146 countries from 2003 to 2023, this study investigates in depth how the development of the global DE influences CE by integrating the level of DE development into an extended gravity model framework, and further examines the threshold effect arising from the DE gap between importing countries and China in this process. The study finds that the development of the global DE has significantly increased CE. The results of heterogeneity analysis indicate that this promoting effect is heterogeneous across countries with different levels of economic development and internet regulation, as well as across different industries. Mechanism analysis shows that this impact is mainly achieved through two channels: reducing trade costs and increasing production capacity. Finally, the empirical results reveal that when the DE gap between China and importing countries is introduced as a threshold variable, the influence of DE development in the importing country on China’s exports exhibits a single-threshold effect. Once the DE gap surpasses this critical point, the positive effect diminishes.
Keywords:
digital economy, gravity model, export trade, digital economy gap, threshold effectHow to Cite
Share
License
Copyright (c) 2026 The Author(s). Published by Vilnius Gediminas Technical University.
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
Abeliansky, A. L., & Hilbert, M. (2017). Digital technology and international trade: Is it the quantity of subscriptions or the quality of data speed that matters? Telecommunications Policy, 41(1), 35–48. https://doi.org/10.1016/j.telpol.2016.11.001
Baron, R. M., & Kenny, D. A. (1986). The moderator-mediator variable distinction in social psychological research: Conceptual, strategic, and statistical considerations. Journal of Personality and Social Psychology, 51(6), 1173–1182. https://doi.org/10.1037/0022-3514.51.6.1173
Bartelsman, E., Haltiwanger, J., & Scarpetta, S. (2013). Cross-country differences in productivity: The role of allocation and selection. American Economic Review, 103(1), 305–334. https://doi.org/10.1257/aer.103.1.305
Cao, T. L., & Hsu, J. (2025). Digitalization and country distance in international trade: An empirical analysis of European countries. Telecommunications Policy, 49(1), Article 102877. https://doi.org/10.1016/j.telpol.2024.102877
Chai, J. W., & Wang, L. H. (2024). The effect of internet gap on bilateral export: evidence from an extended gravity model. Applied Economics, 56(57), 7912–7921. https://doi.org/10.1080/00036846.2023.2289907
Chandra, P. (2017). Trade destruction and trade diversion: Evidence from China. China & World Economy, 25(3), 31–59. https://doi.org/10.1111/cwe.12199
Chen, C., Salike, N., & Thorbecke, W. (2023). Exchange rate effects on China’s exports: Product sophistication and exchange rate elasticity. Asian Economic Journal, 37(3), 371–400. https://doi.org/10.1111/asej.12309
Chen, H. X., & Wang, S. H. (2024). Can the development of industrial intelligence improve the benefits of China’s participation in global value chains? Environmental Impact Assessment Review, 105, Article 107445. https://doi.org/10.1016/j.eiar.2024.107445
Chen, Z. Q., Wei, Y., Shi, K. F., Zhao, Z. Y., Wang, C. X., Wu, B., Qiu, B., & Yu, B. L. (2022). The potential of nighttime light remote sensing data to evaluate the development of digital economy: A case study of China at the city level. Computers Environment and Urban Systems, 92, Article 101749. https://doi.org/10.1016/j.compenvurbsys.2021.101749
Cheng, L., Mi, Z., Coffman, D., Meng, J., & Chang, D. (2021). Destruction and deflection: Evidence from American antidumping actions against China. Structural Change and Economic Dynamics, 57, 203–213. https://doi.org/10.1016/j.strueco.2021.03.009
Chernozhukov, V., Chetverikov, D., Demirer, M., Duflo, E., Hansen, C., Newey, W., & Robins, J. (2018). Double/debiased machine learning for treatment and structural parameters. The Econometrics Journal, 21(1), C1–C68. https://doi.org/10.1111/ectj.12097
Chiappini, R., & Gaglio, C. (2024). Digital intensity, trade costs and exports’ quality upgrading. The World Economy, 47(2), 709–747. https://doi.org/10.1111/twec.13448
China Academy of Information and Communications Technology. (2023). White paper on global digital economy (2023). https://www.caict.ac.cn/kxyj/qwfb/bps/202401/P020240326601000238100.pdf
Cui, K., & Yang, W. (2025). The digital economy and the resilience of enterprise exports: Supply chain stability as a mediator. Finance Research Letters, 73, Article 106650. https://doi.org/10.1016/j.frl.2024.106650
De Groot, H. L. F., Linders, G.-J., Rietveld, P., & Subramanian, U. (2004). The institutional determinants of bilateral trade patterns. Kyklos, 57(1), 103–123. https://doi.org/10.1111/j.0023-5962.2004.00245.x
De Mendonça, T. G., Lirio, V. S., Braga, M. J., & da Silva, O. M. (2014). Institutions and bilateral agricultural trade. Procedia Economics and Finance, 14, 164–172. https://doi.org/10.1016/S2212-5671(14)00699-6
Deng, X., Zhou, M., & Cheng, Y. (2022). Synergistic development of digital economy and urban agglomeration: A study based on night lighting data. Journal of Zhejiang University (Humanities and Social Sciences Edition), 52(4), 32–49 (in Chinese).
Dong, K., Liu, Y., Wang, J., & Dong, X. (2024). Is the digital economy an effective tool for decreasing energy vulnerability? A global case. Ecological Economics, 216, Article 108028. https://doi.org/10.1016/j.ecolecon.2023.108028
Fan, H. L., Trinh Thi, V. H., Zhang, W., & Li, S. (2022). The influence of trade facilitation on agricultural product exports of China: Empirical evidence from ASEAN countries. Economic Research – Ekonomska Istrazivanja, 36(2), Article 2143845. https://doi.org/10.1080/1331677X.2022.2143845
Freund, C., & Weinhold, D. (2002). The Internet and international trade in services. American Economic Review, 92(2), 236–240. https://doi.org/10.1257/000282802320189320
Gereffi, G., Humphrey, J., & Sturgeon, T. (2005). The governance of global value chains. Review of International Political Economy, 12(1), 78–104. https://doi.org/10.1080/09692290500049805
Görg, H., & Mao, H. O. (2022). Does the belt and road initiative stimulate Chinese exports? Evidence from micro data. The World Economy, 45(7), 2084–2100. https://doi.org/10.1111/twec.13258
Guo, P., Hamzah, H. Z., & Chin, L. (2025). Has trade facilitation of the ‘Belt and Road’ countries promoted China’s cross-border E-commerce exports? The World Economy, 48(2), 238–266. https://doi.org/10.1111/twec.13646
Hansen, B. E. (1999). Threshold effects in non-dynamic panels: Estimation, testing, and inference. Journal of Econometrics, 93(2), 345–368. https://doi.org/10.1016/S0304-4076(99)00025-1
He, L.-Y., Lin, X., & Zhang, Z. X. (2020). The impact of de-globalization on China’s economic transformation: Evidence from manufacturing export. Journal of Policy Modeling, 42(3), 628–660. https://doi.org/10.1016/j.jpolmod.2020.02.001
Heavilin, J., & Songur, H. (2020). Institutional distance and Turkey’s outward foreign direct investment. Research in International Business and Finance, 54, Article 101299. https://doi.org/10.1016/j.ribaf.2020.101299
Herman, P. R., & Oliver, S. (2023). Trade, policy, and economic development in the digital economy. Journal of Development Economics, 164, Article 103135. https://doi.org/10.1016/j.jdeveco.2023.103135
Hottman, C. J., Redding, S. J., & Weinstein, D. E. (2016). Quantifying the sources of firm heterogeneity. Quarterly Journal of Economics, 131(3), 1291–1364. https://doi.org/10.1093/qje/qjw012
Kim, J. (2006). Infrastructure of the digital economy: Some empirical findings with the case of Korea. Technological Forecasting and Social Change, 73(4), 377–389. https://doi.org/10.1016/j.techfore.2004.09.003
Lan, X., Hu, Z., & Wen, C. (2025). Can digital transformation reduce the zombification of enterprises? China & World Economy, 33(2), 171–208. https://doi.org/10.1111/cwe.12577
Li, H., & Xiao, B. (2025). Strengthening provincial export resilience through the digital economy: Analysis of impacts, global value chain integration, and regional disparities in China. Finance Research Letters, 76, Article 106990. https://doi.org/10.1016/j.frl.2025.106990
Li, H., Han, J., & Xu, Y. (2023). The effect of the digital economy on services exports competitiveness and ternary margins. Telecommunications Policy, 47(7), Article 102596. https://doi.org/10.1016/j.telpol.2023.102596
Liang, S., & Tan, Q. (2024). Can the digital economy accelerates China’s export technology upgrading? Based on the perspective of export technology complexity. Technological Forecasting and Social Change, 199, Article 123052. https://doi.org/10.1016/j.techfore.2023.123052
Liao, S. C., Chou, T. C., & Huang, C. H. (2022). Revisiting the development trajectory of the digital divide: A main path analysis approach. Technological Forecasting and Social Change, 179, Article 121607. https://doi.org/10.1016/j.techfore.2022.121607
Limão, N., & Venables, A. J. (2001). Infrastructure, geographical disadvantage, transport costs, and trade. The World Bank Economic Review, 15(3), 451–479. https://doi.org/10.1093/wber/15.3.451
Lin, B. Q., & Liu, Y. D. (2025). Renewable energy trade destruction and deflection: Effects of antidumping and countervailing measures on Chinese solar photovoltaic exports. Energy Policy, 204, Article 114687. https://doi.org/10.1016/j.enpol.2025.114687
Liu, A. L., Lu, C. C., & Wang, Z. X. (2020). The roles of cultural and institutional distance in international trade: Evidence from China’s trade with the Belt and Road countries. China Economic Review, 61, Article 101234. https://doi.org/10.1016/j.chieco.2018.10.001
Liu, D., Wang, Q. H., Wang, A. D., & Yao, S. J. (2023). Export profitability and firm R&D: On China’s export diversification under trade war. Structural Change and Economic Dynamics, 67, 151–166. https://doi.org/10.1016/j.strueco.2023.07.012
Liu, J., Wang, P., & Wu, H. (2021). Trade facilitation and China’s agricultural products exports: Empirical evidence from Japan and Korea. Journal of Korea Trade, 25(7), 92–107. https://doi.org/10.35611/jkt.2021.25.7.92
Liu, K., Fu, Q., Ma, Q., & Ren, X. (2024a). Does geopolitical risk affect exports? Evidence from China. Economic Analysis and Policy, 81, 1558–1569. https://doi.org/10.1016/j.eap.2024.02.035
Liu, Y., Dong, Y., & Qian, W. (2024b). Digital economy and China’s agricultural exports: Based on trade cost and market competition effect. China Agricultural Economic Review, 16(3), 489–506. https://doi.org/10.1108/CAER-08-2023-0213
Liu, Y., Dong, Y., & Zhou, H. (2024c). The impact of the agricultural digital economy on China’s agricultural export growth: Examining mechanisms from supply- and demand-side path perspectives. Agribusiness, 42(1), 51–77. https://doi.org/10.1002/agr.21930
Liu, Y., Chen, J., & Sun, C. (2022). Partnership diplomacy and China’s exports. Sustainability, 14(19), Article 12147. https://doi.org/10.3390/su141912147
Lohmann, J. (2011). Do language barriers affect trade? Economics Letters, 110(2), 159–162. https://doi.org/10.1016/j.econlet.2010.10.023
Lythreatis, S., Singh, S. K., & El-Kassar, A.-N. (2022). The digital digital divide: A review and future research agenda. Technological Forecasting and Social Change, 175, Article 121359. https://doi.org/10.1016/j.techfore.2021.121359
Ma, Shu., Wu, P., & Fang, C. (2024). International submarine optical cables, bilateral information flow and Chinese cross-border M&A. World Economy, (4), 3–30 (in Chinese).
Mao, F. L., & Zhang, F. (2021). The evolution of the regional digital economy in China: 1994 to 2018. Quantitative and Technical Economic Studies, 38(7), 3–25 (in Chinese).
Martínez-Zarzoso, I. (2013). The log of gravity revisited. Applied Economics, 45(3), 311–327. https://doi.org/10.1080/00036846.2011.599786
Martínez-Zarzoso, I., & Nowak-Lehmann, F. (2007). Is distance a good proxy for transport costs? The case of competing transport modes. The Journal of International Trade & Economic Development, 16(3), 411–434. https://doi.org/10.1080/09638190701527186
Melitz, M. J. (2003). The impact of trade on intra-industry reallocations and aggregate industry productivity. Econometrica, 71(6), 1695–1725. https://doi.org/10.1111/1468-0262.00467
Mignamissi, D., & Bio, I. (2025). Digital divide and bilateral trade in Africa. Economics of Innovation and New Technology, 1–28. https://doi.org/10.1080/10438599.2025.2474432
Nath, H. K., & Liu, L. (2017). Information and communications technology (ICT) and services trade. Information Economics and Policy, 41, 81–87. https://doi.org/10.1016/j.infoecopol.2017.06.003
Nham, N. T. H., Bao, N. K. Q., & Ha, L. T. (2023). Nonlinear effects of digitalization on export activities: An empirical investigation in European countries. Technological and Economic Development of Economy, 29(3), 1041–1079. https://doi.org/10.3846/tede.2023.17061
Novy, D. (2013). Gravity redux: Measuring international trade costs with panel data. Economic Inquiry, 51(1), 101–121. https://doi.org/10.1111/j.1465-7295.2011.00439.x
Oum, T. H., Wu, X., & Wang, K. (2024). Impact of air connectivity on bilateral service export and import trade: The case of China. Transport Policy, 148, 219–233. https://doi.org/10.1016/j.tranpol.2024.01.015
Pan, W., Xie, T., Wang, Z., & Ma, L. (2022). Digital economy: An innovation driver for total factor productivity. Journal of Business Research, 139, 303–311. https://doi.org/10.1016/j.jbusres.2021.09.061
Porter, M. E., & Heppelmann, J. E. (2014). How smart, connected products are transforming competition. Harvard Business Review, 92(11), 64–88.
Rodriguez-Crespo, E., Marco, R., & Billon, M. (2021). ICTs impacts on trade: A comparative dynamic analysis for internet, mobile phones and broadband. Asia-Pacific Journal of Accounting & Economics, 28(5), 577–591. https://doi.org/10.1080/16081625.2018.1519636
Santos Silva, J. M. C., & Tenreyro, S. (2006). The log of gravity. Review of Economics and Statistics, 88(4), 641–658. https://doi.org/10.1162/rest.88.4.641
Shahbaz, M., Wang, J. D., Dong, K. Y., & Zhao, J. (2022). The impact of digital economy on energy transition across the globe: The mediating role of government governance. Renewable and Sustainable Energy Reviews, 166, Article 112620. https://doi.org/10.1016/j.rser.2022.112620
Shen, N., Zhang, G. P., Zhou, J. W., Zhang, L., Wu, L. J., Zhang, J., & Shang, X. F. (2024). Can big data policy drive urban carbon unlocking efficiency? A new approach based on double machine learning. Journal of Environmental Management, 372, Article 123296. https://doi.org/10.1016/j.jenvman.2024.123296
Tang, W., Lan, Q. X., & Yang, Y. L. (2025). Digital economy’s role in shaping China’s outward investment in Belt and Road countries. Technological and Economic Development of Economy, 31(2), 412–446. https://doi.org/10.3846/tede.2024.21905
Thorbecke, W. (2015). China–US trade: A global outlier. Journal of Asian Economics, 40, 47–58. https://doi.org/10.1016/j.asieco.2015.09.001
Wang, C., Liu, T., Wen, D., Li, D., Vladislav, G., & Zhu, Y. (2021). The impact of international electronic commerce on export trade: Evidence from China. Journal of Theoretical and Applied Electronic Commerce Research, 16(7), 2579–2593. https://doi.org/10.3390/jtaer16070142
Wang, D., Xu, P. Y., An, B. W., & Song, Y. Y. (2024a). How does the development of the digital economy in RCEP member countries affect China’s cross-border e-commerce exports? PLoS ONE, 19(12), Article e0310975. https://doi.org/10.1371/journal.pone.0310975
Wang, J., Wang, K., Dong, K., & Shahbaz, M. (2022). How does the digital economy accelerate global energy justice? Mechanism discussion and empirical test. Energy Economics, 114, Article 106315. https://doi.org/10.1016/j.eneco.2022.106315
Wang, S., & Zhu, Y. (2024). An inquiry into the effect of trade facilitation on China’s digital product exports to countries along the “Belt and Road”. International Review of Economics & Finance, 93, 1246–1259. https://doi.org/10.1016/j.iref.2024.04.041
Wang, W., Wu, Q., Su, J., & Li, B. (2024b). The impact of international logistics performance on import and export trade: an empirical case of the “Belt and Road” initiative countries. Humanities & Social Sciences Communications, 11, Article 1028. https://doi.org/10.1057/s41599-024-03541-0
Weidner, M., & Zylkin, T. (2021). Bias and consistency in three-way gravity models. Journal of International Economics, 132, Article 103513. https://doi.org/10.1016/j.jinteco.2021.103513
Wilson, J. S., Mann, C. L., & Otsuki, T. (2003). Trade facilitation and economic development: A new approach to quantifying the impact. World Bank Economic Review, 17(3), 367–389. https://doi.org/10.1093/wber/lhg027
Wu, H., Xue, Y., Hao, Y., & Ren, S. (2021). How does internet development affect energy-saving and emission reduction? Evidence from China. Energy Economics, 103, Article 105577. https://doi.org/10.1016/j.eneco.2021.105577
Xiao, Y. T., & Abula, B. (2024). Examining the impact of digital economy on agricultural trade efficiency in RCEP region: A perspective based on spatial spillover effects. Journal of the Knowledge Economy, 15, 9907–9934. https://doi.org/10.1007/s13132-023-01484-6 (Retraction published 2025, Journal of the Knowledge Economy, 15, 9907–9934)
Xing, L., Yin, X., Cao, C., Elahi, E., & Wei, T. (2023). The impact of multidimensional distance on agricultural exports: Evidence from China based on the technological added value. Sustainability, 15(1), Article 393. https://doi.org/10.3390/su15010393
Xing, Y. (2018). Rising wages, yuan’s appreciation and China’s processing exports. China Economic Review, 48, 114–122. https://doi.org/10.1016/j.chieco.2017.04.002
Yang, Q., Geng, Y., Dong, H., Zhang, J., Yu, X., Sun, L., Lu, X., & Chen, Y. (2017). Effect of environmental regulations on China’s graphite export. Journal of Cleaner Production, 161, 327–334. https://doi.org/10.1016/j.jclepro.2017.05.131
Yaprak, A., Yosun, T., & Cetindamar, D. (2018). The influence of firm-specific and country-specific advantages in the internationalization of emerging market firms: Evidence from Turkey. International Business Review, 27(1), 198–207. https://doi.org/10.1016/j.ibusrev.2017.07.001
Yin, Z. H., & Choi, C. H. (2024). How does digitalization affect trade in goods and services? Evidence from G20 countries. Journal of the Knowledge Economy, 16, 3614–3638. https://doi.org/10.1007/s13132-024-02029-1
Yu, C., & Luo, Z. (2018). What are China’s real gains within global value chains? Measuring domestic value added in China’s exports of manufactures. China Economic Review, 47, 263–273. https://doi.org/10.1016/j.chieco.2017.08.010
Zhan, J. Y., Wang, X., Li, Q., & Zhao, J. (2025). Digital industry agglomeration and export product diversification: Evidence from Chinese firms. China & World Economy, 33(1), 64–100. https://doi.org/10.1111/cwe.12567
Zhang, H. S., Liu, Q. Q., & Wei, Y. L. (2023). Digital product imports and export product quality: Firm-level evidence from China. China Economic Review, 79, Article 101981. https://doi.org/10.1016/j.chieco.2023.101981
Zhang, L., Cui, L., Li, S., & Lu, J. (2018). Who rides the tide of regionalization: Examining the effect of the China-ASEAN Free Trade Area on the exports of Chinese firms. International Business Review, 27(3), 501–513. https://doi.org/10.1016/j.ibusrev.2017.10.002
Zhang, Z., Xu, H., & Qiao, Z. (2024). Has the digital economy enhanced the income distribution effect among industries? Evidence from China. Sustainability, 16(20), Article 8969. https://doi.org/10.3390/su16208969
Zhou, F., Wen, H., & Lee, C.-C. (2022). Broadband infrastructure and export growth. Telecommunications Policy, 46(5), Article 102347. https://doi.org/10.1016/j.telpol.2022.102347
View article in other formats
CrossMark check
Published
Issue
Section
Copyright
Copyright (c) 2026 The Author(s). Published by Vilnius Gediminas Technical University.
License
This work is licensed under a Creative Commons Attribution 4.0 International License.