DP1228 The Role of Services in the Structure of Production and Trade: Stylized Facts from a Cross-Country Analysis

Author(s): Joseph Francois, Kenneth A Reinert
Publication Date: August 1995
Keyword(s): Production and Services, Services and Development, Trade in Services
JEL(s): F14, O11, O57
Programme Areas: International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=1228

We examine the role of services in the structure of production and trade. Working with a cross-country sample of 17 social accounting matrices, we develop stylized facts relating upstream and downstream service linkages to incomes and the input-output structure of production. Expansion of services is related to expansion of private sector intermediate services, and to increased demand in manufacturing for service inputs. This growth in demand is more closely related to changes in the structure of production rather than to outsourcing or splintering processes. The embodied service component of exports is also strongly linked to the level of development.