The Impact of Artificial Intelligence on International Trade

This paper investigates the impact of artificial intelligence on international trade. We use data on neural machine translation & search engines dominating domestic markets from 2016 to 2019, comprising 196 countries to test for their impact on international trade. Three variations of international trade are used: (1) manufacturing trade (sum of manufacturing exports & imports), (2) manufacturing export, and (3) manufacturing import. We cross-breed artificial intelligence theories with that of international economics. We find that artificial intelligence shows significant results at the 1% level for manufacturing trade, at the 10% level for manufacturing export, and at the 1% level for manufacturing import. We also find that as increasing number of languages are introduced through neural machine learning, there is a decreased need to comprehend the language of another country, which in turn, have significant impact on all three variations of international trade. We also find that domestic search engines are increasingly dominating domestic and global market shares.