Considerable efforts have been made in recent years to produce detailed
topologies of the Internet. Although Internet topology data have been brought
to the attention of a wide and somewhat diverse audience of scholars, so far
they have been overlooked by economists. In this paper, we suggest that such
data could be effectively treated as a proxy to characterize the size of the
"digital economy" at country level and outsourcing: thus, we analyse the
topological structure of the network of trade in digital services (trade in
bits) and compare it with that of the more traditional flow of manufactured
goods across countries. To perform meaningful comparisons across networks with
different characteristics, we define a stochastic benchmark for the number of
connections among each country-pair, based on hypergeometric distribution.
Original data are thus filtered by means of different thresholds, so that we
only focus on the strongest links, i.e., statistically significant links. We
find that trade in bits displays a sparser and less hierarchical network
structure, which is more similar to trade in high-skill manufactured goods than
total trade. Lastly, distance plays a more prominent role in shaping the
network of international trade in physical goods than trade in digital
services.Comment: 25 pages, 6 figure
