Integration of manufacturing and services: Examining its effect on resource allocation and manufacturing labor productivity

Yangyang Yao, Wanhuan Cai, Zhongsheng Zhou and Yifan Zheng

International Review of Financial Analysis, 2024, vol. 96, issue PB

Abstract: The integration of manufacturing and services is a key factor driving the development of the manufacturing sector. Thus, this study uses Chinese province–industry data to determine the effect of such integration on resource allocation and manufacturing labor productivity. Additionally, heterogeneity is systematically examined, while avenues for its improvement are explored. Based on the results, dividing integration into forward and backward integration shows that both types significantly enhance manufacturing labor productivity by improving resource allocation efficiency, with forward integration demonstrating a more pronounced effect. This mechanism mainly manifests in capital- and technology-intensive industries but not in labor-intensive ones. Notably, while the integration of manufacturing and services enhances both economic and social efficiency by curbing capital over-allocation, it creates the problem of labor over-allocation. These conclusions provide value insights for promoting industrial transformation and upgrading.

Keywords: Integrating manufacturing and services; Forward integration; Backward integration; Resource allocation; Manufacturing labor productivity (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1057521924006409
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:96:y:2024:i:pb:s1057521924006409

DOI: 10.1016/j.irfa.2024.103708

Access Statistics for this article

International Review of Financial Analysis is currently edited by B.M. Lucey

More articles in International Review of Financial Analysis from Elsevier
Bibliographic data for series maintained by Catherine Liu ().