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How artificial intelligence applications affect the total factor productivity of the service industry: Firm-level evidence from China

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  • Wu, Xiaojun
  • Zhu, Yi

Abstract

The 21st century has witnessed the emergence of the Fourth Industrial Revolution, bringing forth a new technological revolution worldwide. Artificial intelligence (AI), as cutting-edge general-purpose technology within the information technology (ICT) sector, is increasingly gaining influence and integrating much more closely with various industries. With the service economy becoming a critical component of national economies, the rapid development of AI presents new opportunities for enhancing the total factor productivity (TFP) of the service industry. In light of the convergence between the "service economy" and the "digital economy", this paper aims to assess the level of AI application in the service industry using firm-level data and explore the specific mechanisms through which AI impacts the TFP of the service industry from both theoretical and empirical perspectives.

Suggested Citation

  • Wu, Xiaojun & Zhu, Yi, 2025. "How artificial intelligence applications affect the total factor productivity of the service industry: Firm-level evidence from China," Journal of Asian Economics, Elsevier, vol. 97(C).
    • Handle: RePEc:eee:asieco:v:97:y:2025:i:c:s104900782500017x
    DOI: 10.1016/j.asieco.2025.101893
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