Assessing Trade Competitiveness of E-Business Firmsin Bangladesh Using Porter’s Diamond Model Indicators: An Econometric Method and Multi-Criteria Decision-Making Model Approach

Abstract

The rapid advancement of digital technology has transformed global trade and commerce, with e- business emerging as a key engine of economic growth and competitiveness. In this backdrop, Bangladesh's expanding e-business sector provides a unique opportunity to improve trade dynamics, but its competitive potential remains untapped. This thesis attempts to close this gap by utilizing an integrated framework that integrates Porter's Diamond Model with econometric and Multi-Criteria Decision-Making (MCDM) tools, notably VIKOR and TOPSIS. The study assesses important variables such as Internet Penetration Rate (IPR), Online Sales Volume (OSV), and Number of E-Business Firms (NEF) to uncover competitiveness drivers and provide actionable recommendations for stakeholders. The methodology is based on rigorous statistical analysis, with Granger Causality and Unit Root Tests used to identify dynamic correlations and assure the stationarity of time-series data. The analytical processes were carried out using the computer languages R and Python, which allowed for precise and efficient data management, model creation, and visualization. The MCDM tools VIKOR and TOPSIS improve the decision-making process by ranking methods and selecting the best solutions. The findings demonstrate critical interdependence between the variables under study. The Internet Penetration Rate (IPR) was found as a crucial driver of online sales growth, whereas the Number of E-Business Firms (NEF) demonstrated the market's competitive structure. The study found that investing in digital infrastructure and encouraging innovation are critical to increasing trade competitiveness. In addition, the VIKOR and TOPSIS rankings gave actionable insights, emphasizing the importance of balanced strategies for e-business growth. This thesis contributes to the academic literature by combining old and current analytical frameworks to evaluate e-business dynamics, providing a reproducible paradigm for future research in similar contexts. The ramifications go beyond academia to politicians and corporate leaders, offering a data-driven foundation for improving digital competitiveness. While the study is primarily concerned with Bangladesh, the findings have broader implications, providing insights for other developing countries seeking to use e-business for economic progress.