Reproducibility package for Cheap Energy Might Not Be Enough: A Trade Model Of AI Compute Services
Reference ID
RR_EUR_2026_669
Author(s)
Michael Lokshin
Collections
Metadata
Created on
Jun 30, 2026
Last modified
Jul 13, 2026
Page views
9
Downloads
2
Overview
Abstract
Can energy-rich developing countries convert cheap electricity into AI compute exports? We develop a capacity-constrained Ricardian model of compute trade in which training is globally tradable, but inference incurs a latency cost, and delivered prices carry a bilateral sovereignty premium. Calibrated across 85 countries, the model places several developing economies among the cheapest producers at unsubsidized prices, yet bilateral trust deficits between developing-country producers and OECD buyers eliminate nearly all exports. Globally priced hardware compresses the cross-country cost spread to 12–20 percent, making compute the easiest tradable sector to enter on cost grounds and the most sensitive to small policy frictions: the binding export constraint is institutional credibility, not the price of power.
Reproducibility Package
Scripts
File name
RR_EUR_2026_669
Zip package
RR_EUR_2026_669.zip
Title
Reproducibility package for Cheap Energy Might Not Be Enough: A Trade Model Of Ai Compute Services
Date
2026-06
Dependencies
Stata dependencies are listed in the ado folder.
Instructions
See README in reproducibility package.
Notes
Computational reproducibility verified by Development Impact (DECDI) Analytics team, World Bank.
Source code repository
| Repository name | URI |
|---|---|
| Reproducible Research Repository (World Bank) | https://reproducibility.worldbank.org |
Reproducibility
Technology environment
Paper exhibits were reproduced on a computer with the following specifications:
• OS: Windows 11 Enterprise
• Processor: Intel(R) Xeon(R) Gold 6226R CPU @ 2.90GHz (2.90 GHz) (2 processors)
• Memory available: 16.0 GB
Technology requirements
Run time: 9 minutes
Reproduction instructions
To reproduce the findings from the pre-processed datasets included in the package:
- Update the working directory in line 40 of the do-file
run_alland run it.
To reproduce the findings from the raw data:
- Secure Access to Data: Access the datasets not included in the package. See the Datasets section for more details.
- Run the preprocessing scripts: Run the Python scripts in the
preprocessing/folder following the instructions inpreprocessing/README. - Run the Stata code: Update the working directory in line 40 of the do-file
run_alland run it.
Data
Datasets
Name
Turner & Townsend Data Centre Construction Cost Index 2025
Note
Source: Figures complied using the report "Data Centre Construction Cost Index 2025 from Turner & Townsend.
Access date: February 2026
File location: data/raw/construction/dcci_construction_cost_2025.csv
Access policy
Data is publicly available and included in the reproducibility package.
License
Custom License
Data URL
https://reports.turnerandtownsend.com/data-centre-construction-cost-index-2025/
Citation
Author's complied from from Turner & Townsend. 2025. "Data Centre Construction Cost Index 2025" [report]. https://reports.turnerandtownsend.com/data-centre-construction-cost-index-2025/
Name
Data-Centre Installed Capacity (MW)
Note
Source: Authors' estimates. It is anchored to published figures from Synergy Research Group, CBRE, Cushman & Wakefield, Arizton, Mordor Intelligence, and the IEA.
Access date: February 2026
File location: data/dc_capacity_estimates.csv
Access policy
Data is publicly available and included in the reproducibility package.
License
Custom license
Data URL
https://www.srgresearch.com/; https://www.cbre.com/; https://www.cushmanwakefield.com/; https://www.arizton.com/; https://www.mordorintelligence.com/; https://www.iea.org/
Citation
Authors' compilation. 2026. Synergy Research Group, CBRE, Cushman & Wakefield, Arizton, Mordor Intelligence, IEA. [dataset]. Unpublished.
Name
Worldwide Governance Indicators (WGI)
Note
Source: World Bank, Worldwide Governance Indicators (WGI) — Rule of Law and Regulatory Quality percentile ranks.
Access date: February 2026
File location: data/raw/governance/wgi_rule_of_law.csv.
Access policy
Data is publicly available and included in the reproducibility package.
License
Creative Commons Attribution 4.0 International License (CC BY 4.0)
License URL
https://www.worldbank.org/en/about/legal/terms-of-use-for-datasets
Data URL
https://www.worldbank.org/en/publication/worldwide-governance-indicators
Citation
World Bank. 2025. "Worldwide Governance Indicators" [dataset]. https://www.worldbank.org/en/publication/worldwide-governance-indicators. Accessed February 2026.
Name
World Development Indicators (WDI)
Note
Source: World Bank, World Development Indicators (WDI). Indicators used: GDP per capita, PPP (NY.GDP.PCAP.PP.CD); Population, total (SP.POP.TOTL); Urban population (% of total) (SP.URB.TOTL.IN.ZS). Indicator reference year: 2023. File location: data/wb_gdp_per_capita_ppp_2023.csv; data/wb_population_2023.csv; data/wb_urban_share_2023.csv.
The National Grid - Generation Capacity file (located at data/grid_capacity_estimates.csv) is authors' construction from World Bank World Development Indicators (electricity consumption per capita; population) scaled to installed-capacity and GPU-hour ceilings.
Access date: February 2026.
Access policy
Data is publicly available and included in the reproducibility package.
License
Creative Commons Attribution 4.0 (CC BY 4.0)
License URL
https://datacatalog.worldbank.org/public-licenses
Data URL
https://databank.worldbank.org/source/world-development-indicators
Citation
World Bank. 2023. "World Development Indicators" [dataset]. https://databank.worldbank.org/source/world-development-indicators. Accessed February 2026.
Author's compilation. 2026. "National Grid - Generation Capacity (electric power consumption; population)" [dataset]. Constructed from the World Bank Development Indicators. https://databank.worldbank.org/source/world-development-indicators. Accessed February 2026.
Name
World Bank Country–Region Classification
Note
Source: World Bank country and lending-groups classification.
Access date: February 2026.
File location: data/wb_country_regions.csv
Access policy
Data is publicly available and included in the reproducibility package.
License
Creative Commons Attribution 4.0 International License (CC BY 4.0)
License URL
https://www.worldbank.org/en/about/legal/terms-of-use-for-datasets
Data URL
https://datahelpdesk.worldbank.org/knowledgebase/articles/906519
Citation
World Bank. "World Bank Country–Region Classification" [dataset]. https://datahelpdesk.worldbank.org/knowledgebase/articles/906519. Accessed February 2026.
Name
Seismic-Hazard Zone Flag
Note
Source: Authors' coding. A coarse high-/low-seismic-hazard indicator assigned by the authors from widely-known seismic-hazard geography (high = countries on or near major plate boundaries / active seismic belts). It is consistent with the qualitative classifications of programs such as the Global Seismic Hazard Assessment Program (GSHAP) and United States Geological Survey (USGS) hazard maps.
Access date: February 2026 (authors' coding).
File location: data/seismic_zones.csv
Access policy
Data is publicly available and included in the reproducibility package.
License
Public Domain
Data URL
https://www.gfz-potsdam.de/en/section/seismic-hazard-and-risk-dynamics/; https://www.usgs.gov/programs/earthquake-hazards
Citation
Authors' compilation. 2026. GSHAP/USGS seismic-hazard classifications. [dataset]. Unpublished.
Name
Grid-Reliability Index
Note
Source: Authors' index. It is a constructed index that combines the World Bank Governance Indicators (WGI) governance percentile with a qualitative grid-quality score assigned by the authors (informed by general infrastructure-quality knowledge and reliability reporting), plus a sanctions adjustment.
Access date: February 2026.
File location: data/reliability_index.csv.
Access policy
Data is publicly available and included in the reproducibility package.
License
Creative Commons Attribution 4.0 International License (CC BY 4.0)
License URL
https://www.worldbank.org/en/about/legal/terms-of-use-for-datasets
Data URL
https://www.worldbank.org/en/publication/worldwide-governance-indicators
Citation
Authors' compilation. 2026. "Grid-Reliability Index". Authors-assigned grid-quality score from the World Bank Governance Indicators. [dataset]. Unpublished.
Name
Country Temperatures – ERA5 and Natural Earth
Note
Data accessed in February 2026. Processed output generated by preprocessing/process_temperature.py. The processed file (data/country_temperatures.csv) is included in the package. The raw source file (data/raw/climate/era5_2m_temperature_monthly.nc) is not included due to file size constraints; Natural Earth country boundaries are downloaded at runtime. ERA5 monthly data covers 2020–2024. Sources: (1) ERA5 2-meter monthly temperature: https://cds.climate.copernicus.eu/datasets/reanalysis-era5-single-levels-monthly-means; (2) Natural Earth 1:110m Admin-0 country boundaries: https://www.naturalearthdata.com/downloads/110m-cultural-vectors/.
Access policy
Data is publicly available but not included in the reproducibility package due to file size constraints.
License
CC BY (ERA5); Public Domain (Natural Earth)
License URL
https://cds.climate.copernicus.eu/datasets/reanalysis-era5-single-levels-monthly-means
Data URL
https://cds.climate.copernicus.eu/datasets/reanalysis-era5-single-levels-monthly-means; https://www.naturalearthdata.com/downloads/110m-cultural-vectors/
Citation
Hersbach, H., et al. (2023). "ERA5 monthly averaged data on single levels from 1940 to present" [dataset]. Copernicus Climate Change Service (C3S) Climate Data Store (CDS). DOI: 10.24381/cds.f17050d7. Boundaries: Natural Earth, 1:110m Admin-0 Countries.
Name
WonderNetwork Global Ping Statistics – Country-Pair Latency
Note
Source: WonderNetwork, Global Ping Statistics.
Access date: February 2026.
File location: data/country_pair_latency.csv (shipped); data/wondernetwork_servers.csv (shipped). Raw source: data/raw/latency/wondernetwork_pings.csv.gz.
Access policy
Data access was granted directly to the study authors by the data owners/managers. It was obtained with a custom data license that does not allow for redistribution and it is not included in the reproducibility package.
License
Custom License
Data URL
https://wondernetwork.com/pings
Citation
WonderNetwork. "Global Ping Statistics" [dataset]. https://wondernetwork.com/pings. Accessed February 2026.
Name
Country Electricity Prices
Note
Author-compiled dataset merging three sources into a single file (data/country_electricity_prices.csv), included in the package. The per-row source is recorded in the file's source column. Sources: (1) Eurostat — electricity prices for non-household consumers, reference period 2024 H2 (https://ec.europa.eu/eurostat/databrowser/view/nrg_pc_205/); (2) U.S. Energy Information Administration — average retail electricity prices, reference year 2024 (https://www.eia.gov/electricity/data.php); (3) Authors' manual compilation for approximately 20 non-European/non-EIA countries from GlobalPetrolPrices, national regulators/utilities, and the IEA, reference period 2024–2025 (rows tagged 'research' in source column). Data accessed February 2026.
Access policy
Data is publicly available and included in the reproducibility package.
License
Custom license
License URL
https://ec.europa.eu/eurostat/databrowser/view/nrg_pc_205/; https://www.eia.gov/electricity/data.php; https://www.globalpetrolprices.com/electricity_prices/
Data URL
https://ec.europa.eu/eurostat/databrowser/view/nrg_pc_205/; https://www.eia.gov/electricity/data.php; https://www.globalpetrolprices.com/electricity_prices/
Citation
Authors' compilation. 2026. "Country Electricity Prices" [dataset]. Based on: (1) Eurostat. "Electricity prices for non-household consumers — bi-annual data (nrg_pc_205)" [dataset]. https://ec.europa.eu/eurostat/databrowser/view/nrg_pc_205/. (2) U.S. Energy Information Administration. "Electricity Data: Average Retail Price" [dataset]. https://www.eia.gov/electricity/data.php. (3) GlobalPetrolPrices and national regulators (per-row source column). Accessed February 2026.
Name
Master calibration table
Note
Source: combines into per-country cost-model inputs the following datasets: Country temperatures, Country-pair latency, Country electricity prices, Worldwide Governance Indicators (rule of law, regulatory quality), World Development Indicators (GDP per capita PPP, population, urban share), Seismic-hazard zone flag.
Filename and location: data/calibration_results_v3.csv.
Access date: February 2026 (derived).
Access policy
Data is publicly available and included in the reproducibility package.
License
Custom license
Citation
Author's compilation. 2026. "Master calibration table." [dataset]. Derived dataset released with the package. Unpublished. February 2026.
Data statement
Some data is restricted and has not been included in the reproducibility package. For more details, please refer to the README file.
Description
Output
Type
Working Paper
Title
Cheap Energy Might Not Be Enough: A Trade Model Of Ai Compute Services
Description
Policy Research Working Papers (PRWP)
Authors
| Author | Affiliation | |
|---|---|---|
| Michael Lokshin | World Bank | mlokshin@worldbank.org |
Date of production
2026-06-25
Scope and coverage
Geographic locations
| Location | Code |
|---|---|
| Europe | EUR |
Keywords
Compute Trade
Flops
Artificial Intelligence
Data Centers
Comparative Advantage
Electricity Costs
Developing Countries
Topics
Disclaimer
Disclaimer
The materials in the reproducibility packages are distributed as they were prepared by the staff of the International Bank for Reconstruction and Development/The World Bank. The findings, interpretations, and conclusions expressed in this event do not necessarily reflect the views of the World Bank, the Executive Directors of the World Bank, or the governments they represent. The World Bank does not guarantee the accuracy of the materials included in the reproducibility package.
Access and rights
License
| Name | URI |
|---|---|
| MIT License | https://opensource.org/license/mit |
| World Bank IGO Rider | https://github.com/worldbank/metadata-editor/blob/main/WB-IGO-RIDER.md |
Contacts
Contacts
| Name | Affiliation | |
|---|---|---|
| Michael Lokshin | World Bank | mlokshin@worldbank.org |
| Reproducibility WBG | World Bank | reproducibility@worldbank.org |
Information on metadata
Producers
| Name | Abbreviation | Affiliation | Role |
|---|---|---|---|
| Reproducibility WBG | DECDI | World Bank - Development Impact Department | Verification and preparation of metadata |
Date of Production
2026-06-25
Document version
1