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Services Input Intensity and US Manufacturing Employment Responses to the China Shock

Author

Listed:
  • Omar Bamieh

    (The University of Vienna)

  • Matteo Fiorini

    (European University Institute, Villa Schifanoia)

  • Bernard Hoekman

    (European University Institute, Villa Schifanoia
    Centre for Economic Policy Research)

  • Adam Jakubik

    (World Trade Organization)

Abstract

We present industry-level evidence that manufacturing sectors that make use of services as inputs more intensively are more robust to shocks from import competition. Specifically, the negative effect of the China shock on US manufacturing employment is lower for industries with high services input intensity. Furthermore, our analysis reveals significant heterogeneity in the impact of different types of services, which points towards a fruitful research agenda on the role of services as a determinant of firm competitiveness.

Suggested Citation

  • Omar Bamieh & Matteo Fiorini & Bernard Hoekman & Adam Jakubik, 2020. "Services Input Intensity and US Manufacturing Employment Responses to the China Shock," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 57(2), pages 333-349, September.
    • Handle: RePEc:kap:revind:v:57:y:2020:i:2:d:10.1007_s11151-020-09770-2
    DOI: 10.1007/s11151-020-09770-2
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    Cited by:

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    2. Liu, Xuepeng & Mattoo, Aaditya & Wang, Zhi & Wei, Shang-Jin, 2020. "Services development and comparative advantage in manufacturing," Journal of Development Economics, Elsevier, vol. 144(C).
    3. Chen, Guo & Liu, Yishuang & Gao, Qizheng & Zhang, Jianqing, 2023. "Does regional services development enhance manufacturing firm productivity? A manufacturing servitization perspective," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 451-466.
    4. Matteo Fiorini & Bernard Hoekman & Clément Malgouyres, 2018. "Services policy reform and manufacturing employment: Evidence from transition economies," The World Economy, Wiley Blackwell, vol. 41(9), pages 2320-2348, September.
    5. Pattnayak, Sanja Samirana & Chadha, Alka, 2022. "Servicification and manufacturing exports: Evidence from India," Economic Modelling, Elsevier, vol. 108(C).
    6. Dazhong Cheng & Zhiguo Xiao, 2021. "Producer Services and Productivity: A Global Value Chain Perspective," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 67(2), pages 418-444, June.

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    More about this item

    Keywords

    Manufacturing employment; China shock; Import competition; Servicification; Services input intensity;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • L8 - Industrial Organization - - Industry Studies: Services

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