The Evolution of Services Trade Policy Since the Great Recession

The first international database of services trade policy was created by the World Bank in 2008, just before the Great Recession (Borchert et al., 2014). Since then the economic and political environment has changed dramatically. Global productivity growth has slowed even as technological change is accelerating; multilateral cooperation is ceding ground to a more nationalistic view of policy; and the liberalizing trend post-World War II in goods trade policy is in some cases being reversed. However, we have surprisingly little information on how services policies have evolved.

This gap in information matters because services are intimately linked with developments over the last decade. For instance, the Great Recession originated in financial markets where regulation failed to keep step with liberalization (Rajan, 2010); the emergence of new digital technologies is transforming finance, retail, communication and transport services; and the improvements in information and communication technology could be ushering in a new era of cross-border trade in services (Baldwin, 2019). Are governments reacting to these developments proactively through radical reform, defensively by imposing new restrictions, or inertially by doing nothing?