Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform
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 translati...
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| Format: | Article |
| Language: | English |
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Institute for Operations Research and the Management Sciences (INFORMS)
2021
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| Online Access: | https://hdl.handle.net/1721.1/129711 |
| _version_ | 1826204568111808512 |
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| author | Brynjolfsson, Erik |
| author2 | Sloan School of Management |
| author_facet | Sloan School of Management Brynjolfsson, Erik |
| author_sort | Brynjolfsson, Erik |
| collection | MIT |
| description | 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. |
| first_indexed | 2024-09-23T12:57:32Z |
| format | Article |
| id | mit-1721.1/129711 |
| institution | Massachusetts Institute of Technology |
| language | English |
| last_indexed | 2024-09-23T12:57:32Z |
| publishDate | 2021 |
| publisher | Institute for Operations Research and the Management Sciences (INFORMS) |
| record_format | dspace |
| spelling | mit-1721.1/1297112022-09-28T11:09:46Z Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform Brynjolfsson, Erik Sloan School of Management 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. 2021-02-08T20:40:54Z 2021-02-08T20:40:54Z 2019-09 2021-02-08T16:27:44Z Article http://purl.org/eprint/type/JournalArticle 0025-1909 https://hdl.handle.net/1721.1/129711 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) en 10.1287/MNSC.2019.3388 Management Science Creative Commons Attribution-Noncommercial-Share Alike http://creativecommons.org/licenses/by-nc-sa/4.0/ application/pdf Institute for Operations Research and the Management Sciences (INFORMS) NBER |
| spellingShingle | Brynjolfsson, Erik Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title | Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title_full | Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title_fullStr | Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title_full_unstemmed | Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title_short | Does Machine Translation Affect International Trade? Evidence from a Large Digital Platform |
| title_sort | does machine translation affect international trade evidence from a large digital platform |
| url | https://hdl.handle.net/1721.1/129711 |
| work_keys_str_mv | AT brynjolfssonerik doesmachinetranslationaffectinternationaltradeevidencefromalargedigitalplatform |