Research On The Impact Of Digital Economy On Bilateral Trade Costs

China’s foreign trade in recent years progress,but as a result of international trade,there are many factors that influence the cost of trade trade produced many uncertainty.The digital economy will effectively promote the reduction of trade costs for both parties.This paper will research the digital economy can decrease the cost of China’s trade with other countries,It selects the trade situation between China and 65 trading partners from 2010 to 2017,and analyzes analyze the impact of the improvement of digital economy on the trade cost from the national and industrial levels.Impact.First of all,it defines the connotation of digital economy,and thinks that digital economy is an economic activity which is supported by the construction of digital infrastructure and environmental system,and the digitalization of all economic entities is the core,and all economic entities improve production and operation efficiency through the use and research and improvement of digital technology,and then optimize the allocation of resources.And to build infer index system of the digital economy,through factor analysis method to evaluate countries to the digital economy.Secondly,according to the method of Novy(2013)and He Shuquan(2021)and Tu Yuanfen(2016),the trade cost between China and 65 trading partner countries was measured,and the changes in trade cost over the past 8 years were analyzed from the country level and the industry level.Finally,this paper analyzes the impact of the digital economy on trade costs from multiple dimensions by constructing an econometric model.The conclusions as follow:(1)The digital economy is still unbalanced in the world.Developed countries still have an advantage in the digital economy,and the digital economy of developing countries needs to be further improvement.(2)The trade cost between China and other countries shows the following performance in recent years.From the national level,the trade cost between China and other countries has been declining year by year in recent years,and the trade cost between China and upper middle income countries has been declining at a faster rate.Can be seen from the industry level,for the manufacturing industry and agriculture,China and other countries’ trade costs reduced year by year in 8 years For the mining industry,except for the lower middle income countries,the trade cost between China and other countries fluctuated in the 8 years with a small fluctuation range.(3)The digital economy has a significant negative impact on the cost of trade between the two countries,especially as the level of Internet use between the two countries increases,the impact on the cost of trade between the two countries is more obvious.(4)For countries with different income levels,the digital economy can reduce trade costs,but the impact on China and lower middle income countries is more obvious.