Beefing Up the Service Sector: Commodity Export Booms and Production Network Spillovers

Francesco Amodio, Giorgio Chiovelli and Serafin Frache

No 26158, RFBerlin Discussion Paper Series from ROCKWOOL Foundation Berlin (RFBerlin)

Abstract: We show that commodity export booms can propagate up the value chain, reshape production networks, and drive growth and transformation in the service sector. We study Uruguay's beef export boom to China in the 2010s, combining customs, firm-to-firm transactions, employer-employee, and balance sheet data. Domestic suppliers to beef exporters that expanded trade with China recorded higher sales, especially in services, with associated gains in employment, wages, and sales per worker, along with increased imports of high-quality products. Aggregate sales in the economy rose by 1.79%, with each export dollar generating 46 more cents in domestic sales, including 10 cents in services. Over time, service firms reoriented their connections toward beef exporters, amplifying their gains from trade.

Keywords: commodity exports; production network; services; China shock (search for similar items in EconPapers)
JEL-codes: F14 L14 O14 O54 (search for similar items in EconPapers)
Date: 2026-06
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