HOW DOES TRADE IN DIGITALLY DELIVERED SERVICES AFFECT EMPLOYMENT IN AFRICA?

The rapid advancement of technology and the increasing accessibility of the Internet are driving changes in various economic activities, including international trade. This study explores the relationship between digital trade and employment across 30 African countries from 2009 to 2020, with a particular focus on the role of digitally delivered services as a proxy for digital trade. Utilizing panel data and employing PCSE and IV-2SLS estimation techniques, the findings reveal that while the expansion of digitally delivered services may contribute to a reduction in formal employment, it also fosters growth in the industrial and services sectors, while exerting downward pressure on employment in agriculture. These results are robust and highlight the sector-specific dynamics of digital trade’s impact on labor markets.