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Beefing Up the Service Sector: Commodity Export Booms and Production Network Spillovers

Author

Listed:
  • Giorgio Chiovelli

  • Francesco Amodio
  • Serafín Frache

Abstract

We show that commodity export booms can propagate up the value chain, reshape production networks, and promote growth in the service sector. We study Uruguay’s beef export boom to China in the 2010s, combining customs, firm-to-firm transactions, employer-employee, and balance sheet data. Firms more linked to exporters experienced higher sales, especially in services, with associated gains in employment, wages, and sales per worker. Aggregate sales rose by 1.79%, with each export dollar generating 46 more cents in domestic sales, 10 cents in services. Over time, service firms reoriented their connections toward beef exporters, amplifying their gains from trade.

Suggested Citation

  • Giorgio Chiovelli & Francesco Amodio & Serafín Frache, 2025. "Beefing Up the Service Sector: Commodity Export Booms and Production Network Spillovers," Documentos de Trabajo/Working Papers 2505, Facultad de Ciencias Empresariales y Economia. Universidad de Montevideo..
    • Handle: RePEc:mnt:wpaper:2505
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    Keywords

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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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