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Role of Services in Regional Economy Growth

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  • DAVID L. KAY
  • JAMES E. PRATT
  • MILDRED E. WARNER

Abstract

ABSTRACT Although the final demand‐oriented export base paradigm dominates economic development theory and practice, its usefulness is increasingly questioned because of the changing structure of modern economies, empirical critiques of export‐led growth strategies, and studies that decompose the actual sources of growth. The importance of service industries, especially local services and their role in inducing economic growth, requires a measure that includes both forward and backward linkages to empirically account for the complete role of an industry. Using data for New York State, we demonstrate how the input‐output‐based method of hypothetical extraction can more appropriately measure the economic linkage of a broader range of contemporary economic sectors (including services) than traditional, final demand‐induced, backward‐linkage multipliers. Our analysis provides empirical support for greater economic development attention to be directed toward local services.

Suggested Citation

  • David L. Kay & James E. Pratt & Mildred E. Warner, 2007. "Role of Services in Regional Economy Growth," Growth and Change, Wiley Blackwell, vol. 38(3), pages 419-442, September.
    • Handle: RePEc:bla:growch:v:38:y:2007:i:3:p:419-442
    DOI: 10.1111/j.1468-2257.2007.00377.x
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    Cited by:

    1. Xue Zhang & Mildred E. Warner & George C. Homsy, 2017. "Environment, Equity, and Economic Development Goals: Understanding Differences in Local Economic Development Strategies," Economic Development Quarterly, , vol. 31(3), pages 196-209, August.
    2. Guarino, Raffaele & Corsi, Giulio & Muñoz-Ulecia, Enrique, 2023. "How sustainable development goals have transformed our world? Evolution of the ecological networks of the Italian economy," Ecological Modelling, Elsevier, vol. 484(C).
    3. Kijong Kim & Ipek Ilkkaracan & Tolga Kaya, 2017. "Investing in Social Care Infrastructure and Employment Generation: A Distributional Analysis of the Care Economy in Turkey," Economics Working Paper Archive wp_882, Levy Economics Institute.
    4. Mildred E. Warner & Raymond Gradus, 2009. "The Consequences of Implementing a Child Care Voucher: Evidence from Australia, The Netherlands and USA," Tinbergen Institute Discussion Papers 09-078/3, Tinbergen Institute.
    5. Pratt, James E., 2009. "The Regional Economic Value of Nonmarket Household Production Time: Combining an I-O Framework with Time Use Date," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(01), pages 1-13.
    6. Marc Doussard, 2014. "Reevaluating the Pursuit of Defense Investment," Economic Development Quarterly, , vol. 28(4), pages 339-350, November.
    7. Liu, Zhilin & Warner, Mildred E., 2009. "Understanding Geographic Differences in Child Care Multipliers: Unpacking IMPLAN's Modeling Methodology," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(01), pages 1-15.
    8. Uwitonze, Eric & Heshmati, Almas, 2016. "Service Sector Development and its Determinants in Rwanda," IZA Discussion Papers 10117, Institute of Labor Economics (IZA).
    9. Yuanshuo Xu & Mildred E. Warner, 2022. "Crowding Out Development: Fiscal Federalism after the Great Recession," Environment and Planning A, , vol. 54(2), pages 311-329, March.
    10. Mildred E. Warner & Lingwen Zheng, 2013. "Business Incentive Adoption in the Recession," Economic Development Quarterly, , vol. 27(2), pages 90-101, May.
    11. Joseph T. Campbell & Linda M. Lobao & Michael R. Betz, 2017. "Collaborative Counties: Questioning the Role of Civil Society," Economic Development Quarterly, , vol. 31(3), pages 228-243, August.
    12. Warner, Mildred E., 2009. "Overview: The Regional Economics of Child Care," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(01), pages 1-3.
    13. Lingwen Zheng & Mildred Warner, 2010. "Business Incentive Use Among U.S. Local Governments: A Story of Accountability and Policy Learning," Economic Development Quarterly, , vol. 24(4), pages 325-336, November.
    14. Barba, Izaskun & Iraizoz, Belén, 2025. "The critical role of the health-care sector in promoting employment for women and migrants in the EU. A multicountry input-output analysis," Economic Systems, Elsevier, vol. 49(1).
    15. Andrea Bonaccorsi & Cinzia Daraio, 2013. "Knowledge spillover effects at the sub-regional level. Theory and estimation," DIAG Technical Reports 2013-13, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    16. Solarin, Sakiru Adebola, 2020. "The effects of shale oil production, capital and labour on economic growth in the United States: A maximum likelihood analysis of the resource curse hypothesis," Resources Policy, Elsevier, vol. 68(C).
    17. Watson, Philip & Cooke, Stephen & Kay, David & Alward, Greg & Morales, Alfonso, 2017. "A Method for Evaluating the Economic Contribution of a Local Food System," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 42(2), May.

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