E-commerce and trade openness in Africa: A panel data analysis

This paper probes on the influence of e-commerce on the level of trade openness in Africa using country-level panel data from the period 1990 to 2013. Several additional variables were incorporated into the model to control for omitted variable biased. The estimation with fixed-effects techniques, both under the ordinary least squares (OLS) and generalized method of moments (GMM) estimators, points to evidence a significant positive relationship between e-commerce and trade openness in Africa. In addition, the study also produces insights that foreign direct investment (FDI) may or may not influence trade openness depending on which sectors enjoy FDI. Whereas Country size shows no relationship with trade Openness base on key assumption on policy relations. Given the numerous challenges affecting the improvement of e-commerce trade in Africa, this study suggests the need for further research focusing on how Africa could solve its many challenges.