Services and Manufacturing in Global Value Chains: Is the Distinction Obsolete?

Sébastien Miroudot

No 927, ADBI Working Papers from Asian Development Bank Institute

Abstract: Many studies discuss the “de-industrialization” or “servicification” of economies in both developed and developing countries. Such studies rely on statistics that distinguish a manufacturing from a service sector. But in the age of global value chains (GVCs), it becomes increasingly difficult to disentangle manufacturing from service activities. Goods are produced with services, services are produced with goods, some manufacturing firms are factory-less, and companies tend to sell solutions to customers by bundling goods with services. This business reality has important implications for trade and industry analysis. Against this backdrop, the paper introduces a taxonomy of service activities in GVCs and describes the main statistical challenges in assessing the contribution of manufacturing and services to output, value added, or trade. It then reviews three approaches that take GVCs into account in the analysis of income, comparative advantage, and productivity to address these challenges. As statisticians are working on improving the framework for understanding global production, policymakers should be aware of the blurring lines between goods and services.

Keywords: de-industrialization; servicification; global value chains (search for similar items in EconPapers)
JEL-codes: F14 F23 F68 L60 L80 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2019-03-04
New Economics Papers: this item is included in nep-int, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Services and Manufacturing in Global Value Chains: Is the Dstinction Obsolete? (2019)
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