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Summary:
This research focuses on the relationship between technical innovation and international trade. International trade refers to the export and purchase of goods and services between nations in order to meet the requirements of their populations. In a variety of ways, advanced technologies have an influence on international trade. They speed up all operations necessary for international trade and facilitate trade between nations that have and do not have such technology. They also facilitate worldwide communication and encourage changes in international business, assisting in the establishment of global manufacturing networks. A trade gravity model is used to investigate the influence of technical factors on sectoral exports. Today, Bangladesh's international trade exceeds USD 80 billion. The Bangladesh government spends about USD 70 billion, with up to USD 20 billion going toward development and technology purchase. If we want to get into the exclusive club, both government procurement and private business must be accelerators of technology and innovation.
Table of Contents
- Summary:
- Introduction:..................................................................................................................................................
- Literature Review:
- Objective of the study:
- Methodology of the study:
- Sourcing of Data
- Observation
- Analysis of Technology & International Trade:
- Export........................................................................................................................................................
- Import........................................................................................................................................................
- Findings and Discussion
- Conclusion:
- References
Literature Review:
In this study, technology dramatically positive impact on international trade that is exports and imports, as well as has some issues of causality between them as follows:
Mercy Tembon, World Bank Country Director for Bangladesh and Bhutan, stated that Bangladeshi manufacturers must urgently change their focus away from low labor- intensive productivity and toward greater productivity. Firms will need to embrace better technology across business activities and manufacturing processes in order for this to happen. According to Joseph Schumpeter , Trade and industry drive economic expansion, which is a dynamic process. Many causes for economic development linked to trade, according to this author, include the introduction of a new item quality or a new application of an existing good, a new manufacturing method, the opening of a new market, and a change in economic structure. Technical innovation may be defined as a country's ability to turn fresh ideas into reality by developing creative items and processes that play a significant role in international commerce and economic growth. Developing relevant criteria to evaluate the degree of technological innovation across nations is critical in a knowledge-based economy with a strong and growing concentration on information technology and human resources. . Márquez Ramos, Martínez Zarzoso, Sanjuan Lucas and Suárez Burguet addressed that have lately created a variety of indices and factors to assess technological innovation success. Nonetheless, a country's technical achievements are extremely complicated. As a result, capturing them in an index that reflects the complete variety of technologies and measures some elements of technology innovation, dissemination, and human capabilities is challenging. To address these issues, the Technological Achievement Index (TAI) has been employed in empirical studies.
Objective of the study:
The objectives of the study are:
To understand the basic relationship between technology and international trade. To determine the significant impact of advanced technology on international trade in Bangladesh. To recognize the findings of the effect of technology on international trade.
Methodology of the study:
Sourcing of Data:
This study is conducted mainly based on secondary data was gathered from Journal, Books, Wikipedia, Google Scholar, Qoura, and other websites. In addition, a thorough literature review was conducted by browsing several online libraries.
As well as data obtained from primary data collection source, observation-
Observation:
To perform the study, collected data from the class observation where teacher and students attitude, perception, and responsiveness on international trade i.e. export and import and what the significant impact of technology on it thereby generate idea and has done it.
Analysis of Technology & International Trade:
Technology and International trade or business is interconnected. In the modern era, international business would not possible to conduct properly without technology modes or tools. Electronic communication, such as emails, messages, faxes, and virtual conferences, are among the most significant means of technology in international trade. Another significant technical advancement is tracking techniques for shipping and purchasing, which allows firms to verify the delivery of items and the quantity of inventory acquired. Other technologies that make it easier for the country's firms to handle and preserve their data include electronic spreadsheets and databases.
According to a research by the World Bank and the Confederation of British Industry (CBI) (Yunfan Gu, 2021), Bangladesh's manufacturing sector may enhance productivity through improving innovation and technology adoption in businesses. Three pillars were highlighted in the report: managerial and worker competencies, linkage to foreign markets, and complementary markets and institutions. According to the research, adopting new technology and business processes will aid trades in recovering faster from the COVID-19 crisis. Technology contributes to export diversification in the RMG sector of Bangladesh.
Technological developments have benefitted both individuals and companies. Technology has benefited society in a variety of ways, including increasing the range of items available on shop
Import:
Imports are products and services purchased from another nation by people, businesses, and governments. Countries that purchase products or services from another nation owing to either production constraints in domestic sectors or the desire to get more efficient and cost-effective imported commodities. Importer refers to the person who receives products or services, while exporter refers to the person who sends them. Import refers to the acquisition of a product or service developed in another country by the home country. Bangladesh's total imports of goods and services from 2008 to 2017 are shown below.
Findings and Discussion:
To assess a country's export potential, revealed comparative advantage (RCA) measures have been employed. In contrast to circumstances where the number of items that may be competitively exported is static, the RCA shows whether a country is in the process of expanding the products in which it has trade potential. As stated in Equation 1, the index is determined by dividing a country's proportion of worldwide exports of a certain good by its percentage of overall world exports.
Here,
RCA𝑖𝑘 is the RCA index of products k for Bangladesh i 𝑋𝑖𝑘 is the value of product k exported by country i, 𝑋𝑤𝑘 is the value of world exports of product k, 𝑋𝑖𝑁 is the value of the exports of all the products by Bangladesh i, And 𝑋𝑤𝑁 is the value of world exports of all the products.
When RCA𝑖𝑘 is higher than one, Bangladesh I has a competitive advantage in exporting items k, according to Equation.
Now recognizing the technological achievement of Bangladesh in trade. Understanding how successfully a country participates in producing, employing, and disseminating technology as well as establishing a human skill base to acquire knowledge is possible thanks to the technical achievement index (TAI). Bergstrand, Deardorff has defined a gravity equation and calculated for the disaggregated data in order to analyze the influence of technological innovation on trade. The following is the approximated equation:
𝒍𝒏𝑿𝒊𝒋𝒌 = 𝑎 0 + 𝑎 1 ∙ ln 𝑌𝑖 + 𝑎 2 ∙ ln 𝑌𝑗 + 𝑎 3 ∙ 𝐴𝑑𝑗𝑖𝑗 + 𝑎 4 ∙ 𝐿𝑎𝑛𝑑𝑖 + 𝑎 5 ∙ 𝐿𝑎𝑛𝑑𝑗 + 𝑎 6 ∙ 𝐺𝑀 + 𝑎 7 ∙ 𝐼𝑛 𝐷𝑖𝑠𝑡𝑖𝑗 + 𝑎 8 ∙ 𝐿𝑎𝑛𝑔𝑖𝑗 + 𝑎 9 ∙ 𝐶𝑜𝑙𝑜𝑛𝑦𝑖𝑗 + 𝑎 10 ∙ 𝑇𝐴𝐼𝑖 + 𝑎 11 ∙ 𝑇𝐴𝐼𝑗 + 𝑎 12 ∙ 𝐼𝑛 𝑇𝑎𝑟𝑖𝑓𝑓𝑠𝑖𝑘 + 𝑎 13
∙ 𝐼𝑛 𝑇𝐶𝑖 + 𝑎 14 ∙ 𝐼𝑛 𝑇𝐶𝑗 + 𝑎 15 ∙ ℎ𝑖𝑔ℎ __𝑡𝑒𝑐ℎ𝑘 𝑎 16 ∙ ℎ𝑜𝑚𝑘
Leader (TAI > 0,5): Technology creation and innovation capability are fundamental for all countries to achieve the highest levels of technological advancement. Leaders who possess technical innovation have a significant competitive edge in the global economy. There is existed only developed countries. Potential Leaders (TAI = 0,35-0,49): Most of the countries in Potential Leaders are developing countries. Dynamic Adopters (TAI = 0,20-0,34): Some countries in this group have human skills levels and diffusion recent and old technologies comparable with Potential Leaders Marginalized (TAI ˂ 0,20): In nearly every element of technical advancement, these countries fall behind. This group of nations has a low degree of technical advancement and has a long way to go in terms of technology dissemination and human skill development. People in many regions of these nations still lack access to "old" technology.
As a consequence of the debate above, prospective leaders in international business exist in Bangladesh, and they are improving their technology to trade throughout the country on a daily basis.
Conclusion:
The primary goal of this research is to look at Bangladesh's interaction with technology and international trade, as well as how much technology plays a part in international trade (export and import). The data are collected from both primary and secondary methods like websites, journals, newspapers, books, and observations. The result obtained in the analysis of RCA and TAI shows technology plays a significant role in international trade. With the empirical research, the study tries to reveal the overall impact of technology on the export and import of Bangladesh. Hence, low and high levels of these components result in fewer exports, but an intermediate level results in increased exports.
References
Capozzi, C. (2017, September 26). Bizfluent. Retrieved from bizfluent.com: https://bizfluent.com/about-7542416-importance-technology-international-business.html
Karim, H. N. (2021, Feb 21). Bangladesh and the ongoing technological revolution. The Daily Star. Retrieved from https://www.thedailystar.net/supplements/30th-anniversary- supplements/aspirations-the-next-50-years/news/bangladesh-and-the-ongoing- technological-revolution-
Kathleen M. Wilburn, H. R. (2018). THE IMPACT OF TECHNOLOGY ON BUSINESS AND SOCIETY.
Yunfan Gu, G. N. (2021). Gearing Up for the Future of Manufacturing in Bangladesh. Retrieved from https://documents1.worldbank.org/curated/en/702731624306432211/pdf/Gearing- Up-for-the-Future-of-Manufacturing-in-Bangladesh.pdf
L. (n.d.). Http://www.economics-ejournal.org/dataset/comments/comment.2009-07- 08.3750567228.pdf_. The Effect Of Technological Innovation On International Trade._
