Sources of Structural Change for the UK Service Industries 1979–84

Over the period 1979 to 1984 the UK economy experienced severe structural change in that the oil and services sectors increased their share of employment and output, whilst the share of manufacturing fell by about 5 percentage points. This paper uses input–output tables for 1979 and 1984 to decompose the changes in output of total marketed services and the component industries into the changes due to price changes and those due to volume changes. The volume changes are, in turn, decomposed into those internal to the service industries, e.g. changes in demand for business services by communication, and those external to the industries, e.g. changes in demand for services by manufacturing. The analysis is done at a 101-industry level with results presented in the paper for the five service industries, Distribution and Catering, Transport, Communications, Business Services and Other Market Services. The paper is intended to give insight into the answers to the following questions: How much of the increase in service output has been due to the reallocation of activities previously done within manufacturing? In what respects were services insulated from the effects of the general recession 1979-812? Has the recent growth in services output been due to more consumers' expenditure and other. final demand or to other factors? The main conclusion is that changes in Input–Output coefficients were very important for structure change in UK services, almost entirely because they dominated the fastest-growing sector, business services.     

The Sources of Change in Canadian Industry Output

Canadian input–output tables for 1961, 1971, 1976, and 1981 are used to apply the techniques of Feldman et al., (1987) to decompose the sources of change in Canadian industrial output. The results of the decompositions are in general agreement with the finding by Feldman et al., that, while changes in output levels may be attributed primarily to changing final demands, technical coefficient effects are relatively more important among the fastest growing and declining industries. For Canada, however, technical coefficient effects are generally more important in the declining industries, and less so for the fastest growing industries. Furthermore, technical coefficient effects have become relatively more important in a greater number of industries over time, especially among industries in which output levels have been falling. The results also suggest that the combined bridge and technical coeficient effect overstates the actual effect of shifts in the structure of industry production. When bridge coefficient effects are separated from the technical coefficient effects and included in total final demand effects, the results provide additional evidence that final demand continues to be the major source of both absolute and relative rates of output growth for the majority of Canadian industries.     

Trade Affected Workers in the Service Sector

A bstract . Using input output data for 1987 and 1990, this study identified those groups of service sector workers most vulnerable to trade-related employment displacements. Relative to other industry groups, workers (both black and white) in service industries which experienced an increase in (positive) net trade-related employment, were more likely to be male, elderly (over 65 years of age), less educated (high school graduates) and unskilled (laborers). In contrast, service industries which suffered a decline in (positive) net trade-related employment between 1987 and 1990, were relatively more skill-intensive (as measured by the share of college educated workers, scientists, engineers and managers in the labor force) , and more likely to employ women, married couples and individuals in the 25 to 35 age bracket. Union members on the other hand, were overrepresented in service industries which suffered net trade–related employment losses in 1987 and 1990. The latter industries, however, experienced an improvement over the period.     

Impact of R&D and Technology Diffusion on Productivity Growth: Empirical Evidence for 10 OECD Countries

This paper examines the empirical evidence on the impact of performed R&D and of R&D embodied in intermediate and capital goods on productivity performance in 10 major OECD countries over the last two decades. To quantify intersectoral and international technology flows, industry-level embodied R&D variables were constructed from an input–output (IO) R&D embodiment model. The productivity variables used are discrete Divisia growth indexes of total factor productivity (TFP), which were estimated from an IO growth accounting model. The results from pooled regressions indicate that the rates of return of the R&D variables were positively significant and increasing in the 1980s. In particular, embodied R&D is an important source for TFP growth in services, indicating very high social returns of the flows of capital-embodied technology into this sector. Moreover, the information and communi-cation technology (ICT) cluster of industries played a major role in the generation and cquisition of new technologies at the international level.     

Service Intensities in the Indian Economy: 1968/9–1993/4

This paper analyses the service intensities for production of different industries in the Indian economy during the period 1968–69 to 1993–94 with an input–output approach. Two different methodologies—(1) direct service intensities and (2) direct plus indirect service intensities—have been used to calculate the service intensity of different industries using six input–output tables. It is found from the exercise that service intensities have increased in the Indian economy over 25 years. To reflect the performance and trend of service intensity of each industry over the study period, the mean and coefficient of variation of the service intensities have been calculated. The empirical part of this study shows that Metal products, Machineries, Trade, and Banking have a high mean and a low coefficient of variation. According to their service intensities they were the key sectors, with consistently the largest consumption of the output of the service sector as an input for their production.     

A look at productivity at the firm level in eight French service industries

In this paper, we take advantage of information collected by the French annual survey of market services to analyze productivity differences and changes among firms in eight major industries (restaurants, hotels, engineering, computer programming, computer processing, legal services, accounting and building cleaning), over the five-year period 1984–1988. We find a pattern of cross-sectional and time-series type estimates of the Cobb-Douglas production function, which is comparable to that typically found in studies of manufacturing industries, thus raising similar issues of interpretation and modeling. Using a capital stock measure corrected for rented equipment and building and taking into account the number of hours of work of work per employee improve these estimates to some extent. An interesting finding is that the output elasticity seems significantly smaller with respect to hours per employee than with respect to the number of employees.     

Measuring the Impact of Direct and Indirect R&D on the Productivity Growth of Industries: Using the Yale Technology Concordance

This paper investigates the impact of direct and indirect R&D on the productivity growth of 30 French industries during the period 1978–92. The main aim of this paper is to assess the appropriateness of the Yale Technology Concordance (YTC) as a proxy for indirect R&D flows. We compare the effect on productivity growth of the Yale proxy with the traditional proxy based on goods input–output flows, and assess their suitability for different groups of industries. Results indicate that the indirect YTC proxy performs slightly better than the traditional proxy, as a result of superior performance in the high-tech and service sectors in particular.     

The growth of information workers in the US economy, 1950–2000: the role of technological change,computerization, and structural change

Using data from the decennial US Censuses of 1950, 1960, 1970, 1980, 1990, and 2000, I construct matrices of employment by 267 occupations and 64 industries and then aggregate the occupations into four categories: (i) knowledge producers; (ii) data processors; (iii) service workers; and (iv) goods-processing workers. I find that information workers (the sum of the first two categories) increased from 37% of the workforce in 1950 to 59% in 2000. Then, using an input–output decomposition analysis, I find that the growth in information workers was driven not by a shift in tastes toward information-intensive goods and services (as measured by the composition of final demand) but rather by a roughly equal combination of the substitution of information workers for goods and service workers within the structure of production of industries and the unbalanced growth effect (from differential rates of industry productivity growth). Finally, on the basis of regression analysis, I find that R&D expenditures and computer investment are positively associated with the growth in knowledge workers but negatively associated with the growth of data workers.     

Productivity Growth,Import Leakage and Employment Growth in Puerto Rico, 1967–87

Using Puerto Rican input–output data that cover the period 1967–87, we find that employment growth was led primarily by a rapid increase in final output—5.1% per year—although labor productivity growth was also substantial, at 3.7% per year. Import leakages also fell over this period, but had little impact on employment growth. Local absorption was more successful than exports in generating new jobs. Employment generated by local absorption grew by 35% and that from exports by 29%, even though exports increased almost four-fold, while local absorption only doubled. The difference reflects the greater labor intensity of industries that supply local absorption. There was also a notable shift in the occupational structure toward white-collar employment and away from blue-collar jobs. The primary reason for this was the shift in the composition of final demand toward industries that rely heavily on white-collar workers. A secondary reason was a bias in technological change, which favored white-collar over blue-collar workers.     

Structural change and blurred sectoral boundaries: assessing the extent to which knowledge-intensive business services satisfy manufacturing final demand in Western countries

This paper focuses on the vertical integration of knowledge-intensive business services (KIBS) into manufacturing sectors, using a subsystem approach to input–output analysis. It aims at correctly assessing the process of structural change that has occurred in the four main European countries (France, Germany, Italy and the UK) over time (1995–2005). It does not focus on KIBS sectors per se, but on their function as carriers and sources of knowledge which influences the performance of sectors, value chains and clusters across industries and within countries. The analysis shows that KIBS’ contribution to satisfying the final demand of manufacturing is in general largely underestimated; that KIBS vertical integration into manufacturing has increased over time in all the countries investigated except the UK; and that the extent to which manufacturing sectors outsource to KIBS is significantly affected by their technological intensity.     

Industry analysis and investment decision-making under conditions of uncertainty

Evaluating risk is a key element in successful investment decision-making. A major risk in forecasting company performance is associated with projecting its cash flow streams by product-line which in turn is strongly related to the expected industry outlook and likely variability about this outlook. This paper sets out a methodology for evaluating this aspect of the investment decision by developing measures of expected real cash flow growth (reward) and expected annual variability of this growth (risk). These measures are constructed for 77 industry classifications at the two and three digit SIC (Standard Industrial Classification) level of detail by solving a dynamic input–output model under various economic secenarios. Aside from producing results which are relevant for producing company valuation bands, the analysis strongly suggests that perceptions of which industries are ‘winners’ and which are ‘losers’ are significantly altered when both ‘reward’ and ‘risk’ are used as criteria as opposed to either one alone. Finally, the methodology also produces results which measures the sources of cash flow growth in terms of relative price performance, productivity, and demand for output. Since there measures can be used as indicators of the quality of industry real cash flow growth, industry performance can be further arrayed within the broad categories of winning and losing industries. Several examples of how this is done are offered.     

The Impact of a Rapidly Expanding Service Sector on Private Office Property: The Case of Hong Kong

Hong Kong's economy has undergone a remarkable transformation over the past two decades. The rapid expansion of the service sector is a major outcome. Within the services sector, the finance, insurance, real estate (FIRE) and business services sub-sector is the most influential and also the major source of generating demand for office space in the economy. This paper examines how the rapid expansion of the FIRE and business service sub-sector influences new office construction. Using the Engle-Granger (1987) methodology for cointegration and error correction mechanism (ECM), the causal relationships between growth of sub-sectors of the services sector and the new office space construction were explored. The FIRE and business services sub-sector growth is shown to be cointegrated with new office space construction. The paper reports empirical findings based on a sample survey on location and quality of space. The study reveals that the growth of the FIRE and business service sector has influenced office space development in terms of location of space, per capita space and the type and quality space during 1981-2000.     

Non-maximizing output behavior for firms with a cost-constrained technology

In many public service industries, firms are constrained by a cost (budget) and characterized by non-maximizing output behavior, due to bureaucratic behavior, for instance. This paper proposes a model based on the assumption that firms with a cost constraint do not maximize service levels due to resource preferences. It derives the exact relationships between services delivered, (shadow) input prices, cost constraints, and optimal input quantities. From these relationships, allocative efficiencies, technical efficiencies, output ray elasticities, and marginal cost can easily be derived.      

辽中南城市群中心城市服务业一体化发展的可行性分析

本研究以辽中南城市群为案例,基于中心城市服务业的产值结构和就业结构现状,分析了中心城市服务业发展的特征和存在的问题,利用定量指标测度目前中心城市服务业发展的比较优势和一体化发展的基础。研究认为,尽管目前辽中南城市群以工业为主的第二产业仍占主导,但服务业发展迅速;从服务业内部结构看,服务事业发展水平相对较高,服务产业整体相对落后于京津冀等区域;基于区位商和城市间服务业联系强度测度的结果显示,辽中南城市群中心城市服务业发展已出现差异化趋势,城市群内部服务业不均衡问题较为突出,单极化特征明显。根据以上分析,提出推进该区域服务业一体化的政策措施。     

Metafrontier efficiency analysis for hospital pharmacy services using dynamic network DEA framework

Medication management is a complex but critical process within the healthcare delivery system. The pharmacy department in healthcare facilities is responsible for acquisition, distribution and dispensing of medication to patients that involves a series of network process. This process can be categorized into two main subprocesses: i) pharmacy store and ii) patient services (i.e., ambulatory and inpatient pharmacy). The objective of this study was to investigate the relative efficiency level of the two subprocesses of pharmacy services in Malaysia's public hospitals. We used a nonconvex metafrontier technology to estimate technical efficiency of hospital pharmacies between specialist and nonspecialist hospital categories under the dynamic network data envelopment analysis (DNDEA) framework. For overall efficiency, both specialist and nonspecialist categories had similar mean efficiency scores. However, when measuring the efficiency level according to pharmacy store and patient services separately, the nonspecialist category had a higher mean efficiency score in pharmacy store, whereas for patient service efficiency, both categories had similar results. The patient service efficiency level was lower consistently over time, suggesting that the overall inefficiency of hospital pharmacy is greatly influenced by the inefficiency of the patient service. This suggests that systematic improvements in patient service efficiency should be a higher priority than pharmacy store efficiency to further increase the overall efficiency level. We believe that our findings will provide valuable information to policymakers towards achieving an efficient public healthcare service.     

The effect of labor supply changes on output: empirical evidence from US industries

In this paper we examine the relationship between labor supply and industry-level output in the context of the specific factors model. Jones (Trade, balance of payment and growth: essays in honor of Charles P. Kindleberger, Amsterdam, pp 3–21, 1971) shows that a rise in the amount of labor in the economy will increase the output in all industries. We empirically show which industry output is predicted to expand more when the size of labor force grows. Unlike the commonly used Rybczynski Theorem (Economica 22:336–341, 1955) of the Heckscher-Ohlin model, the specific factors model shows that a comparison both of labor intensities and labor demand elasticities plays an important role in determining which output expands relatively more when the size of labor force grows. For this purpose, we illustrate the importance of the parameters of the model in determining how changes in the labor supply affect the output change, with special reference to elasticities of substitution in production. We estimate the elasticity of substitution by using CES production function and show how these estimates describe the general equilibrium of production with one mobile factor (labor) and 25 industries of the US economy using data for 1979–2001. We show that the increase in the supply of labor raise output in all industries, but the magnitudes of the increases in some industries are more than others depending on the value of the elasticity of substitution along with factor intensities between industries. The largest output effect occurs for educational, health care and social service, where a 1 % supply of labor increase would raise output 10.5 %. However, the growth in the labor supply has a small impact on output growth in the range of 0.1–0.6 % in agriculture, petroleum, coal product and finance and insurance industries.     

Has the EU's Single Market Programme Fostered Competition? Testing for a Decrease in Mark‐up Ratios in EU Industries*

We use a panel approach, covering 10 EU Member States over the period 1981–99, for each of three major industry groups (manufacturing, construction and services) and 18 more detailed industries to test whether the EU's Single Market Programme has led to a reduction in firms’ mark‐ups over marginal costs. We address explicitly the uncertainty with respect to the timing of the changeover and allow for a possibly continuous regime shift in a smooth transition analysis. Where regime shifts can be found, the velocity of transition is extremely high, making the linear model a justifiable approximation. We also test for discrete structural breaks in the time window from 1986 to 1996, taking up endogeneity concerns in a generalized method of moments framework. Mark‐up reductions are found for aggregate manufacturing (although it is also suggested that mark‐ups increased in some manufacturing industries in the precompletion period at the end of the 1980s) and also for construction. In contrast, mark‐ups have gone up in most service industries since the early 1990s, which confirms the weak state of the Single Market for services and suggests that anti‐competitive defence strategies have emerged in EU service industries.     

二级城市发展现代服务业的困境和解决途径--以苏州、无锡、杭州为例

近年来,我国大都市区中的二级城市在制造业的支撑下获得了快速发展,形成了制造业和首位城市水平分工,现代服务业高度依赖首位城市的产业分工格局.本文从维持二级城市经济持续成长的角度出发,以上海都市区的三座特大二级城市苏州、无锡和杭州为例,研究了二级城市现代服务业发展的现状,分析了二级城市现代服务业发展的限制性因素,从市场、优先发展的部门、产业组织、制度环境的营造等方面探讨了加速二级城市现代服务业发展的可能途径.     

International Comparisons of Australia's Infrastructure Performance

International benchmarking has played a key role in the reform of Australia's infrastructure industries by promoting indirect or yardstick competition, in highlighting the need for further reform and building a consensus for implementing necessary changes. The international benchmarking of infrastructure performance by the Bureau of Industry Economics (BIE) between 1991 and 1996 did much to focus attention on the need for change. The BIE examined the performance of eight infrastructure industries relative to international best practice: electricity, rail freight, telecommunications, the waterfront, road freight, coastal shipping, aviation and gas supply. Performance comparisons concentrated on indicators of price, service quality, labour productivity and capital productivity. This paper reviews and summarises the performance comparisons the BIE undertook over the last three years of its infrastructure benchmarking program. The BIE international benchmarking program provides a useful role model for other countries wanting to seriously pursue reform of their infrastructure industries.     

Relative productivity growth and the secular “decline” of U.S. manufacturing

There has been considerable debate about the causes of the “decline” of U.S. manufacturing over the post-war period. We show that the behavior of employment, prices and output in manufacturing relative to services over this period can be explained by a two-sector growth model in which productivity shocks are the only driving forces. Household preferences turn out to play a key role in our model. The data are consistent with a specification where households are unwilling to substitute goods for services (the estimated elasticity of substitution is statistically indistinguishable from zero), so the economy adjusts to differential productivity growth entirely by re-allocating labor across sectors.