Productive linkages in a segmented model: analyzing the role of services in the exporting performance of German manufacturing

Daniel Herrero
Additional contact information
Daniel Herrero: Instituto Complutense de Estudios Internacionales (ICEI), Universidad Complutense de Madrid.

No 2005, Working Papers del Instituto Complutense de Estudios Internacionales from Universidad Complutense de Madrid, Instituto Complutense de Estudios Internacionales

Abstract: This article analyzes the causes of the exporting performance of the German manufacturing sector. By applying a subsystem approach to the input-output analysis, we take into account the interlinkages that exist between manufacturing and services. Particularly, two types of relationships that influence manufacturing competitiveness are considered: the wage squeeze in services due to institutional factors and outsourcing; and the role played by the knowledge-intensive business services (KIBS) as innovation drivers. With vertically integrated sectors as observations, an export model is estimated. Overall, our results point to the minor importance of labor costs for international competitiveness. We also capture a significant but small effect of service suppliers’labor cost on manufacturing exports. We find that KIBS have helped manufacturing gain international competitiveness. The paper concludes that non-price factors are the main drivers of German exports and that the relationship between manufacturing and services is not only a matter of cost reduction.

Keywords: Unit labor costs; Competitiveness; Germany; Manufacturing; Productive linkages; Input-output (search for similar items in EconPapers)
Pages: 30 pages
Date: 2020
New Economics Papers: this item is included in nep-cse and nep-eur
References: Add references at CitEc
Citations:

Downloads: (external link)
https://eprints.ucm.es/id/eprint/63580/1/WP05-20.pdf Full text (application/pdf)

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:ucm:wpaper:2005

Ordering information: This working paper can be ordered from
Instituto Complutense de Estudios Internacionales. Finca Mas Ferre Campus de Somosaguas 28223 Madrid

Access Statistics for this paper

More papers in Working Papers del Instituto Complutense de Estudios Internacionales from Universidad Complutense de Madrid, Instituto Complutense de Estudios Internacionales Contact information at EDIRC.
Bibliographic data for series maintained by Águeda González Abad ().