This paper examines whether restrictive data policies impact trade in services over the internet. We have collected comparable information on a variety of policy measures that regulate data for a wide group of countries for the years 2006-2016. This information is compiled in a weighted index that assesses the restrictiveness of these countries' data policies. We distinguish between policies regulating the crossborder movement of data and policies regulating the domestic use of data. Using econometric estimations, we show that strict data policies negatively and significantly impact imports of data-intense services. Therefore, countries applying restrictive data policies, in particular with respect to the crossborder flow of data, suffer from lower levels of services traded over the internet. This negative impact is stronger for countries with better developed digital networks. The results of our analysis are significant and hold for various robustness checks.

This paper examines how policies regulating the cross-border movement and domestic use of electronic data on the internet impact the productivity of firms in sectors relying on electronic data. In doing so, we collect regulatory information on a group of developed economies and create an index that measures the regulatory restrictiveness of each country's data policies. The index is based on observable policy measures that explicitly inhibit the cross-border movement and domestic use of data. Using crosscountry firm-level and industry-level data, we analyse econometrically the extent to which these data regulations over time impact the productivity performance of downstream firms and industries respectively. We show that stricter data policies have a negative and significant impact on the performance of downstream firms in sectors reliant on electronic data. This adverse effect is stronger for countries with strong technology networks, for servicified firms, and holds for several robustness checks.