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The Link Between Manufacturing Growth and Accelerated Services Growth in India

  • Rajeev H. Dehejia
  • Arvind Panagariya

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.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19923.

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Date of creation: Feb 2014
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Handle: RePEc:nbr:nberwo:19923
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