Intersectoral Linkages and Key Sectors in China, 1987–1997

B. Andreosso‐O'Callaghan and G. Yue

Asian Economic Journal, 2004, vol. 18, issue 2, 165-183

Abstract: Since the pioneering work by Rasmussen and others in the 1950s, alternative measures of linkages have been developed, with the aim of examining the interdependence in production structures and in identifying key sectors in an economy. Our study proposes a comparative analysis of traditional and modern methods, by applying them to the case of China between 1987 and 1997. It finds that backward and forward linkages have generally increased in China, denoting an increase in intersectoral interdependence, with some sectors (e.g. agriculture, food, textiles and chemicals) being dominant in this process. With regard to the identification of key sectors, hypothetical extraction methods provide superior results compared with traditional methods. Agriculture, textiles, chemicals, building materials, primary metals, machinery, commerce and other services are all recognized as being the key sectors by both the total linkage and pure linkage methods.

Date: 2004
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