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Boosting Productivity in Korea's Service Sector

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  • Randall S. Jones
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    Abstract

    Labour productivity growth in the service sector has been low relative to manufacturing. This is explained in part by weak competition in services resulting from strict product market regulation and the low level of import penetration and inflows of foreign direct investment (FDI). Increasing productivity growth in the service sector, which accounts for 67% of employment and 58% of value added in Korea, is essential to sustain high potential growth. The priority is to strengthen competition by eliminating domestic entry barriers, accelerating regulatory reform, upgrading competition policy and reducing barriers to trade and inflows of FDI. Another challenge is to enhance the performance and accelerate the restructuring of small and medium-sized enterprises, which account for over 90% of service-sector employment. Furthermore, it is essential to boost productivity in service industries with high growth potential, such as telecommunications and financial and business. Rehausser la productivité dans le secteur des services en Corée La croissance de la productivité du travail dans le secteur des services a été lente par rapport à celle du secteur manufacturier. Cela s’explique en partie par la faiblesse de la concurrence dans les services, due à une réglementation stricte des marchés de produits et à un niveau peu élevé de pénétration des importations et d’entrées d’investissement direct étranger (IDE). Un renforcement des gains de productivité dans le secteur des services, qui représente 67 % de l’emploi et 58 % de la valeur ajoutée en Corée, est essentiel pour soutenir un taux élevé de croissance potentielle. Il faut en priorité intensifier la concurrence en supprimant les barrières intérieures à l’entrée, en accélérant la réforme de la réglementation, en améliorant la politique de la concurrence et en réduisant les obstacles au commerce et à l’afflux d’IDE. Une autre tâche difficile sera de rehausser les résultats et d’accélérer la restructuration des petites et moyennes entreprises, qui représentent plus de 90 % de l’emploi dans le secteur des services. Il est par ailleurs indispensable de stimuler la productivité dans les domaines qui ont un fort potentiel de croissance, comme les télécommunications et les services financiers et aux entreprises.

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    File URL: http://dx.doi.org/10.1787/226625875038
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    Bibliographic Info

    Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 673.

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    Date of creation: 20 Feb 2009
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    Handle: RePEc:oec:ecoaaa:673-en

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    Keywords: competition policy; telecommunications; regulatory reforms; foreign direct investment; productivity and growth; legal services; small and medium-sized enterprises; Korea; service sector; services trade; financial services; KFTC; Business service; FTAs; services légaux; KFTC; services financiers; secteur des services; commerce de service; service aux entreprises; croissance de la productivité; petites et moyennes entreprises; télécommunications; investissement direct étranger; Corée; réforme de la réglementation; politique de la concurrence;

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