The Export Effect of Servitization of Manufacturing

Hyunsoo Kim (), Jungu Kang (), Hyeyoon Keum () and Jae Wook Jung ()
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Hyunsoo Kim: KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP), Postal: [30147] Building C, Sejong National Research Complexa, 370, Sicheong-daero, Sejong-si, Korea, https://www.kiep.go.kr/eng/
Jungu Kang: KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP), Postal: [30147] Building C, Sejong National Research Complexa, 370, Sicheong-daero, Sejong-si, Korea, https://www.kiep.go.kr/eng/
Hyeyoon Keum: KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP), Postal: [30147] Building C, Sejong National Research Complexa, 370, Sicheong-daero, Sejong-si, Korea, https://www.kiep.go.kr/eng/
Jae Wook Jung: Sogang University, Postal: [04107]35, Baekbeom-ro, Mapo-gu, Seoul, Republic of Korea, https://www.sogang.ac.kr/index.do

No 22-36, World Economy Brief from Korea Institute for International Economic Policy

Abstract: This study examines the status and characteristics of Korea’s servitization of manufacturing and its impact on business performance and exports. In particular, we focus on servitization in manufacturing, which can be seen as a part of servicification in manufacturing. It is the phenomenon of manufacturing firms producing more services as final goods and provide them to the market with their products. Looking at the status of servitization in the manufacturing sectors focusing on the service sales generated by manufacturing firms, the servitization in manufacturing in Korea has gradually increased. Sales in service sectors, which stood at 4.5% of the total sales of manufacturing firms in 2012, surged to 15.9% in 2017, and then decreased to 6.9% in 2019. Based on the stylized fact that servitization in manufacturing in Korea has gradually increased, we empirically analyze the effect of servitization in manufacturing on the business performances and exports. The result suggets that the servitization in manufacturing is progressing in the direction of improving firm’s productivity, profitability, and exports.

Keywords: Servicification; Servitization; Export (search for similar items in EconPapers)
Pages: 7 pages
Date: 2022-09-02
New Economics Papers: this item is included in nep-int
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