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The Link Between Manufacturing Growth and Accelerated Services Growth in India

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  • Rajeev H. Dehejia
  • Arvind Panagariya

Abstract

The impact of trade liberalization on manufacturing growth has been widely studied in the literature. What has gone unappreciated is that accelerated manufacturing growth has also been accompanied by accelerated services growth. Using firm-level data from India, we find a positive spillover from manufacturing growth to gross value added, wages, employment, and worker productivity in services, especially large urban firms and in service sectors whose output is used as a manufacturing input.

Suggested Citation

  • Rajeev H. Dehejia & Arvind Panagariya, 2014. "The Link Between Manufacturing Growth and Accelerated Services Growth in India," NBER Working Papers 19923, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:19923
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    References listed on IDEAS

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    Cited by:

    1. Foellmi, Reto & Legge, Stefan & Tiemann, Alexa, 2015. "Innovation and Trade in the Presence of Credit Constraints," CEPR Discussion Papers 10391, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform

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