Service Sector Productivity and Economic Growth in Asia
Lee, Jong-Wha; McKibbin, Warwick J. | July 2014
Abstract
This paper explores the impacts of more rapid growth in labor productivity in the service sector in Asia based on an empirical general equilibrium model. The model allows for input– output linkages and capital movements across industries and economies, and consumption and investment dynamics. We find that faster productivity growth in the service sector in Asia benefits all sectors eventually, and contributes to the sustained and balanced growth of Asian economies, but the dynamic adjustment is different across economies. This adjustment depends on the sectoral composition of each economy, the capital intensity of each sector, and the openness of each sector to international trade. In particular, during the adjustment to higher services productivity growth, there is a significant expansion of the durable manufacturing sector that is required to provide the capital stock that accompanies the higher aggregate economic growth rate.
Citation
Lee, Jong-Wha; McKibbin, Warwick J.. 2014. Service Sector Productivity and Economic Growth in Asia. © Asian Development Bank. http://hdl.handle.net/11540/4001. License: CC BY 3.0 IGO.Keywords
Commerce and Industry
Intra-Industry Trade
Large Scale Industry
Labor
Technical Evaluation
Results-Based Monitoring And Evaluation
Performance Evaluation
Industrialization
Industrial Economics
Industrial Development
Industrial Policy
Technology assessment
Capital market
Developing countries
Market share
Labor
Technology transfer
Cumulative effects assessment
Job analysis
Task analysis
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