The Study Of The Trend And Effect Of Developed Country’s Ratio Of Intermediate Service Input

Producer service is an important standard to measure the economy of a country,also it has a complementary relationship with the manufacturing sector. Not only theproducer service rely on the demands of manufacturing industry, the competitivenessof manufacturing industry is mostly up to the ratio of producer service input. Mostof the value-added of manufacturing in developed country is provided by theproducer service at both ends of the production chain. Besides, producer servicetakes a great proportion of the internal structure of tertiary industry. After30years’implementation of reform, China’s manufacturing has been at the lower level ofproduction chain which has been focusing on raw materials processing and foreigntrade in international division of labor.The literature review of this article found that most researches mainly focus onthe impact of the whole producer service to manufacturing, however, they did notisolate the specific input of manufacturing and service industry due to the limitationof statistical data, the purpose of this paper is to explore this aspect.Firstly, five typical developed countries’ input-output tables of1995-2008areselected(the United States, Japan, Britain, France and Germany) to calculate theintermediate service input ratio to have a trend analysis. The results show thatdeveloped countries’ manufacturing intermediate service input rise first then has adownward trend. On the basis of trend analysis, amended Cobb-Douglas productionfunction is used to construct a panel data model to analysis the impact ofintermediate service input to the competitiveness and product of manufacturing indeveloped countries. Conclusion can be drawn that developed countries’manufacturing intermediate service input has a significant positive impact inpromoting the competitiveness and output, also the degree of influence has greatlyimprove as compare to the previous studies. Each subdivision industry of producerservice differently has a positive impact in promoting the competitiveness andoutput. Secondly, comparison is made by the five developed countries and Chinathrough calculating the ratio of intermediate service input of2007. Results show thatthe ratio of producer service input is much lower than the developed, andmanufacturing’s demand for intermediate service is still insufficient which limits thedevelopment of producer service and the manufacturing structural upgrade. So it isimportant to speed up the tertialization in China.At last, this paper advance three policy suggestion to strengthen the interactionbetween producer service and manufacturing so that China would take actionsbefore manufacturing globally large-scale backflow.