Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/202200 
Year of Publication: 
2014
Series/Report no.: 
Institute for Prospective Technological Studies Digital Economy Working Paper No. 2014/10
Publisher: 
European Commission, Joint Research Centre (JRC), Seville
Abstract: 
We use data on cross-border e-commerce between EU Member States to estimate the implied cross-border trade cost reduction when consumers move from offline to online consumption. We plug this trade cost estimate into a macro-sector multi-country CGE model to estimate the impact of online retailing on consumers as well as producers. We find that cross-border e-commerce increases real household consumption. However, the domestic spill-over effect squeezes price margins in the retail sector and has a negative output effect for that sector. The resulting retail sector efficiency gains have a positive effect on production in other sectors. The combined macro-economic effect of these transmission channels is generally positive for EU Member States, ranging between 0.07 and 0.25 per cent of GDP. As such, this paper adds an innovative macro-perspective to existing micro-economic estimates of the impact of e-commerce on consumer welfare.
Subjects: 
e-commerce
online trade
cross-border trade
international trade
EU digital single market
CGE model
non-tariff barriers
JEL: 
F14
C54
Document Type: 
Working Paper

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