Blockchain Adoption and International Trade Performance: Evidence from Panel ARDL Analysis of BRICS Economies

This study examines the impact of blockchain adoption on international trade performance in BRICS economies using panel data over the period 2010–2024. Employing the Panel Autoregressive Distributed Lag (P-ARDL) model, the analysis distinguishes between short-run and long-run dynamics while accounting for cross-country heterogeneity. The results indicate that blockchain adoption has a statistically significant and positive effect on trade performance in the long run, primarily by enhancing transaction efficiency, transparency, and trust in cross-border exchanges. In the short run, however, the effects are mixed, reflecting adjustment costs, technological barriers, and varying levels of digital infrastructure across countries. The findings remain robust after controlling key macroeconomic variables, including GDP, exchange rates, and trade openness. This study aligns with existing empirical evidence on the trade-enhancing role of blockchain in BRICS economies, a topic that has received limited attention. The results suggest that policies promoting digital infrastructure, regulatory clarity, and technological adoption can strengthen trade integration and economic cooperation among BRICS members. Keywords: International Trade, Blockchain Technology, Cointegrating regression, Panel Autoregressive Distributed Lag, BRICS REFERENCES Aggarwal, P. (2020). On de-risking and de-dollarizing intra-BRICS trade via smart contracts. BRICS Journal of Economics, 1 (4), 54–69. https: //doi. org/10. 38050/2712-7508-2020-1-4-6 Allen, D. W. E. , Berg, C. , Davidson, S. , Novak, M. , & Potts, J. (2019). International policy coordination for blockchain supply chains. Asia & the Pacific Policy Studies, 6 (3), 367–380. https: //doi. org/10. 1002/app5. 281 Balci, G. , & Surucu-Balci, E. (2021). Blockchain adoption in the maritime supply chain: Examining barriers and salient stakeholders in containerized international trade. Transportation Research Part E: Logistics and Transportation Review, 156, 102539. https: //doi. org/10. 1016/j. tre. 2021. 102539 Belu, M. G. (2019). Application of Blockchain in International Trade: An Overview. 71. Bildirici, M. (2004a). Political instability and growth: an econometric analysis of Turkey, Mexico, Argentina and Brazil, 1985-2004. Bildirici, M. (2004b). Real cost of employment an Turkish labour market: a panel cointegration tests approach. International Journal of Applied Econometrics and Quantitative Studies, 1 (2), 95-120. Chandan, A. , John, M. , Potdar, V. , Chandan, A. , John, M. , & Potdar, V. (2023). Achieving UN SDGs in Food Supply Chain Using Blockchain Technology. Sustainability, 15 (3). https: //doi. org/10. 3390/su15032109 Chang, S. E. , Chen, Y. -C. , & Wu, T. -C. (2019). Exploring blockchain technology in international trade: Business process re-engineering for letter of credit. Industrial Management & Data Systems, ahead-of-print (ahead-of-print). https: //doi. org/10. 1108/IMDS-12-2018-0568 Chang, S. E. , Luo, H. L. , Chen, Y. , Chang, S. E. , Luo, H. L. , & Chen, Y. (2019). Blockchain-Enabled Trade Finance Innovation: A Potential Paradigm Shift on Using Letter of Credit. Sustainability, 12 (1). Cherenkova, S. A. (2023). Advantages and potential risks of introducing the digital ruble in modern Russia. Национальная Безопасность / Nota Bene, (1), 53–65. https: //doi. org/10. 7256/2454-0668. 2023. 1. 39797 Chistruga, A. (2023). Using blockchain technology to combat counterfeiting. SHS Web of Conferences, 177, 02004. https: //doi. org/10. 1051/shsconf/202317702004 Saputra, U. W. E. , & Darma, G. S. (2022). The Intention to Use Blockchain in Indonesia Using Extended Approach Technology Acceptance Model (TAM). CommIT (Communication and Information Technology) Journal, 16 (1), 27–35. https: //doi. org/10. 21512/commit. v16i1. 7609 Chang, Y. , Iakovou, E. , & Shi, W. (2020). Blockchain in global supply chains and cross border trade: A critical synthesis of the state-of-the-art, challenges and opportunities. International Journal of Production Research, 58 (7), 2082–2099. https: //doi. org/10. 1080/00207543. 2019. 1651946 Crosby, M. (2016). BlockChain Technology: Beyond Bitcoin. den Butter, F. A. G. , & Mosch, R. H. J. (2003). Trade, Trust and Transaction Costs (SSRN Scholarly Paper No. 459501). Social Science Research Network. https: //doi. org/10. 2139/ssrn. 459501 Digital ruble today and tomorrow: Bank of Russia’s report on pilot testing https: //www. cbr. ru/eng/press/event/? id=24743 Department of Building Economics, University of Moratuwa, Weerakoon, H. D. , Chandanie, H. , & Department of Building Economics, University of Moratuwa. (2021). Analysis of Feasibility of Blockchain Technology For International Trade Related To Sri Lankan Construction Industry. Proceedings of the 9th World Construction Symposium 2021 on Reshaping Construction: Strategic, Structural and Cultural Transformations towards the “Next Normal, ” 75–85. https: //doi. org/10. 31705/WCS. 2021. 7 Dyhrberg, A. H. (2016). Bitcoin, gold and the dollar – A GARCH volatility analysis. Finance Research Letters, 16, 85–92. https: //doi. org/10. 1016/j. frl. 2015. 10. 008 Galvez, J. F. , Mejuto, J. C. , & Simal-Gandara, J. (2018). Future challenges on the use of blockchain for food traceability analysis. TrAC Trends in Analytical Chemistry, 107, 222–232. https: //doi. org/10. 1016/j. trac. 2018. 08. 011 Ganne, E. (with World Trade Organization). (2018). Can blockchain revolutionize international trade? World Trade Organization. https: //doi. org/10. 30875/7c7e7202-en Granger, C. W. J. (1969). Investigating Causal Relations by Econometric Models and Cross-spectral Methods. Econometrica, 37 (3), 424–438. https: //doi. org/10. 2307/1912791 Haber, S. , & Stornetta, W. S. (1991). How to Time-Stamp a Digital Document. In A. J. Menezes & S. A. Vanstone (Eds. ), Advances in Cryptology-CRYPTO’ 90 (pp. 437–455). Springer. https: //doi. org/10. 1007/3-540-38424-3₃2 Hastig, G. M. , & Sodhi, M. S. (2020). Blockchain for Supply Chain Traceability: Business Requirements and Critical Success Factors. Production and Operations Management, 29 (4), 935–954. https: //doi. org/10. 1111/poms. 13147 Im, K. S. , Pesaran, M. H. , & Shin, Y. (2003). Testing for unit roots in heterogeneous panels. Journal of Econometrics, 115 (1), 53–74. https: //doi. org/10. 1016/S0304-4076 (03) 00092-7 Johansen, S. (1988). Statistical analysis of cointegration vectors. Journal of Economic Dynamics and Control, 12 (2–3), 231–254. https: //doi. org/10. 1016/0165-1889 (88) 90041-3 Jouini, J. (2015). Linkage between international trade and economic growth in GCC countries: Empirical evidence from PMG estimation approach. The Journal of International Trade & Economic Development, 24 (3), 341–372. https: //doi. org/10. 1080/09638199. 2014. 904394 Juma, H. , Shaalan, K. , & Kamel, I. (2019). A Survey on Using Blockchain in Trade Supply Chain Solutions. IEEE Access, 7, 184115–184132. https: //doi. org/10. 1109/ACCESS. 2019. 2960542 Kandaswamy, R. , & Furlonger, D. (n. d. ). Blockchain-Based Transformation: A Gartner Trend Insight Report. Koh, L. , Dolgui, A. , & Sarkis, J. (2020). Blockchain in transport and logistics – paradigms and transitions. International Journal of Production Research, 58 (7), 2054–2062. https: //doi. org/10. 1080/00207543. 2020. 1736428 Kshetri, N. (2018). 1 Blockchain’s roles in meeting key supply chain management objectives. International Journal of Information Management, 39, 80–89. https: //doi. org/10. 1016/j. ijinfomgt. 2017. 12. 005 Kumar, S. , Shahid, A. , & Agarwal, M. (2024). Is BRICS Expansion Significant for Global Trade and GDP? BRICS Journal of Economics, 5 (4), 5–36. https: //doi. org/10. 3897/brics-econ. 5. e139877 Lian, G. (2022). Research on Credit Algorithm of International Trade Enterprises Based on Blockchain. Mathematical Problems in Engineering, 2022 (1), 4768868. https: //doi. org/10. 1155/2022/4768868 Liu, Z. Z. , & Papa, M. (2022). Can BRICS De-dollarize the Global Financial System? Elements in the Economics of Emerging Markets. https: //doi. org/10. 1017/9781009029544 Nach, M. , & Ncwadi, R. (2024). BRICS economic integration: Prospects and challenges. South African Journal of International Affairs, 31 (2), 151–166. https: //doi. org/10. 1080/10220461. 2024. 2380676 Nakamoto, S. (2008). Bitcoin: A Peer-to-Peer Electronic Cash System. Okazaki, Y. (2018). Unveiling the Potential of Blockchain for Customs. Öz, S. , Gören, HE. , (2019). Application of blockchain technology in the supply chain management process: Case studies, Journal of International Trade, Logistics and Law, 5 (1), pp. 21-27. Öz, S. , (2020). Genel Teknoloji ve Dijital Dönüşüm Teorisine Giriş, A Chapter in the book, “Teknolojik vee Dijital Dönüşüm”, Ankara, Nobel, pp. 269-292. Phillips, P. C. B. , & Perron, P. (1988). Testing for a Unit Root in Time Series Regression. Biometrika, 75 (2), 335–346. https: //doi. org/10. 2307/2336182 Saberi, S. , Kouhizadeh, M. , Sarkis, J. , & Shen, L. (2019). Blockchain technology and its relationships to sustainable supply chain management. International Journal of Production Research, 57 (7), 2117–2135. https: //doi. org/10. 1080/00207543. 2018. 1533261 Siddik, Md. N. A. , Kabiraj, S. , Hosen, Md. E. , & Miah, Md. F. (2021). Blockchain Technology and Facilitation of International Trade: An Empirical Analysis. FIIB Business Review, 10 (3), 232–241. https: //doi. org/10. 1177/2319714520968297 Siddiqui, K. (2016). Will the Growth of the BRICs Cause a Shift in the Global Balance of Economic Power in the 21st Century? International Journal of Political Economy, 45 (4), 315–338. https: //doi. org/10. 1080/08911916. 2016. 1270084 Tapscott, D. , & Tapscott, A. (2016). Blockchain revolution: How the technology behind bitcoin is changing money, business, and the world. Portfolio / Penguin. Tian, X. , Zhu, J. , Zhao, X. , & Wu, J. (2024). Improving operational efficiency through blockchain: Evidence from a field experiment in cross-border trade. Production Planning & Control, 35 (9), 1009–1024. https: //doi. org/10. 1080/09537287. 2022. 2058412 Wang, Y. , Singgih, M. , Wang, J. , & Rit, M. (2019). Making sense of bloc