Producer Services And Economic Development In Shanghai

First, the paper reviews the relevant theoretic development of service industry and then focus on the research results concerning the nature, feature and classifications of producer services.Second, since the classification of producer services differs among scholars at home and abroad, the paper put forward a specific classification of producer services in Shanghai through a quantitative method. Based on the definition of producer services, the industry sectors of which most goods or services satisfy needs of other sectors instead of needs of consumers are classified as producer services. In detail, the paper uses the input-output table of Shanghai to calculate the intermediate usage ratio of sectors to define the classification.Third, through analysis on the input and output table of Shanghai, the paper validates that producer service sectors are the most contributive industries to the second industry. Finance and insurance sector as a producer service sector play a more significant role to the development of other third industry sectors than any second industry sector. Furthermore, based on the analysis of inter-industry spread effect, the paper finds the induction coefficients and influence coefficients of producer services are higher than the average of level of service industry, which shows the significant leading and supporting role of producer services in the economic development.Fourth, according to the regression and point-elasticity analysis, the paper concludes that the producer services in Shanghai are a major engine for the economic development. And the employment elasticity of producer services is much higher than the average level of the third industry. Therefore, the producer services can create more job opportunities than other third industry sectors during economic development.Furthermore, compared with Hong Kong and Singapore, Shanghai has its own pros and cons in the development of producer services. Shanghai, compared with its peers in China, has a relatively good location, a quite big pool of talents and comprehensive contact home and abroad. Meanwhile, Shanghai still meets some challenges. First, it has no local famous and large scale producer service companies. Second, Shanghai needs more specialized talents in financial and logistic area especially. Third, the radiate capacity of local producer service suppliers to the other provinces and cities is still weak.Finally, the paper delivers some suggestion on the development of producer services in Shanghai: Shanghai need to fasten its "four-center" development and improve its comprehensive service function as a international city. Shanghai need to attract more international talents and top producer services companies in the world. Meanwhile, Shanghai should cultivate more local suppliers and strengthen the interaction with surrounding provinces.