The Impact of the Opening of Producer Services on the International Competitiveness of Manufacturing Industry

Cuiping Yu, Decai Tang, Acheampong Paul Tenkorang and Brandon J. Bethel
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Cuiping Yu: School of Law and Business, Sanjiang University, Nanjing 210012, China
Decai Tang: School of Law and Business, Sanjiang University, Nanjing 210012, China
Acheampong Paul Tenkorang: School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China
Brandon J. Bethel: School of Marine Sciences, Nanjing University of Information Science & Technology, Nanjing 210044, China

Sustainability, 2021, vol. 13, issue 20, 1-17

Abstract: Countries participating in the international division of labor each try to occupy the industrial highlands, obtain competitive advantages, and promote sustainability of economic development. Based on Porter’s Diamond model, it is widely believed that producer services are vital to support the manufacturing industry. Consequently, this paper selects samples of 55 countries and uses data from 2010 to 2017 to empirically test the impact of producer service’s opening on the export competitiveness of the manufacturing industry. The results show that the opening of producer services in a country promotes the improvement of international competitiveness of manufacturing industry, and the improvement effect is more significant in developed countries than in developing countries. Additionally, the negative impact of foreign capital access restrictions on the export competitiveness of the manufacturing industry is greater than the positive impact of service trade opening. It is also found that the restrictions on foreign capital’s opening in the financial sector have the biggest negative impact on manufacturing exports than that of other divisions of the producer service industry. To improve national competitiveness, it is suggested that the integration of service and manufacturing industries should be enhanced and to decrease FDI access to financial and transportation services restrictions.

Keywords: producer services; international competitiveness; manufacturing industry; diamond model; foreign investment (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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