Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform
Name
w24917.pdf
Description
Submitted version
Size
904.12 KB
Format
Adobe PDF
Checksum (MD5)
ae6391b39b3f64b36460bd4977a62564
Author(s)
Brynjolfsson, Erik
Date Issued
September 2019
Journal
Management Science
Publisher
Institute for Operations Research and the Management Sciences (INFORMS)
Citation
Brynjolfsson, Erik et al. “Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform.” Management Science, 65, 12 (September 2020): 5449-5956 © 2020 The Author(s)
Version
Original manuscript
Abstract
Artificial intelligence (AI) is surpassing human performance in a growing number of domains. However, there is limited evidence of its economic effects. Using data from a digital platform, we study a key application of AI: machine translation. We find that the introduction of a new machine translation system has significantly increased international trade on this platform, increasing exports by 10.9%. Furthermore, heterogeneous treatment effects are consistent with a substantial reduction in translation costs. Our results provide causal evidence that language barriers significantly hinder trade and that AI has already begun to improve economic efficiency in at least one domain.
MIT Department
Sloan School of Management
Terms of Use
Creative Commons Attribution-Noncommercial-Share Alike
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.1287/MNSC.2019.3388
