The Service Sector in an Increasingly Efficient Europe

Lennart Hjalmarsson

Chapter 6 in How Unified Is the European Union?, 2009, pp 79-98 from Springer

Abstract: Abstract “The Union has today set itself a new strategic goal for the next decade: to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion” was proudly declared at the March 2000 European Council summit in Lisbon, when the Heads of State and Government agreed on a common strategy for sustainable growth, the so-called Lisbon strategy. Although work has been done to stimulate economic reforms within the EU ever since the summit, the results so far have been meagre. The EU is therefore currently discussing a renewed Lisbon strategy and the necessity of “putting the work in a higher gear”. A key sector in the future development of productivity and employment within the EU is the service sector. The EU Service Directive was approved in December of 2006, and the EU member countries and the EES countries (Iceland, Liechtenstein and Norway) must implement the directive no later than 28 December 2009. The directive is very extensive and includes many different kinds of services within a wide range of areas. The belief that increased competition in the service markets will result in lower prices and improved efficiency is central in the directive, which therefore aims to make it easier for businesses to get established and perform temporary services in the EU internal market. In order to make free movement of workers in the EU/ESS easier, the member countries have been asked to remove heavy and unnecessary bureaucracy, simplify administration for service producers, and strengthen the rights of service consumers. There have been great hopes that the service directive and a liberalisation and deregulation of the EU service markets will lead to increased productivity and absorb the work force that becomes available due to the labour-saving technical change of the industrial sector. The expected effects of the EU Service Directive have been analyzed in a number of studies. Overall, these indicate considerable potential welfare gains for Europe in general.

Keywords: Service Sector; Total Factor Productivity; Service Trade; Lisbon Strategy; High Income Elasticity (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-540-95855-0_6

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DOI: 10.1007/978-3-540-95855-0_6

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