Modern Services Exports from Emerging Countries—Perspectives and
Opportunities
release_k7kgzoetwfb7jbvtkijvqmdaze
by
Shahbaz Nasir
2012 Volume 51, Issue 4II, p209-226
Abstract
Traditionally, developed countries are the major exporters of
services; however, technological developments in IT and communications
over the last two decades have made it possible for developing countries
to exploit their comparative advantage in some modern services. The
driving force for this comparative advantage is the large pool of
semi-skilled and skilled graduates in emerging countries who can deliver
their services across borders, using advanced communication
technologies. Why do emerging countries have increasing modern services
exports? How are these exports explained by theory? What are the factors
behind this export growth and the reasons to expect future growth? These
are some of the important questions that researchers and policy-makers
would like to find answers to and an attempt has been made to answer
these questions in this paper. Identification of the sources of services
export growth from emerging and developing countries can be attempted
through established theories of goods trade and production. This paper
reviews selected theory and empirical work in order to explain the
underlying causes for growing exports of services. Causes for the export
of modern services may include a comparative advantage of the exporting
country, cost reduction for the importing firm through outsourcing,
reduction in trading costs due to technological improvements and an
increase in gains from services trade.
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