An Study On The Industrial Convergence Affecting Manufacturing Industry Performance

Based on the theoretical analysis of the performance of manufacturing industry and industrial integration, this paper calculates the forward convergence and reverse convergence to measure the degree of industrial integration, and analysis how the industrial integration effects the performance of manufacturing industry through static comparative analysis and empirical research. With the input-output table data of 40 countries from WIOD database, this paper calculates the forward convergence and reverse convergence of 40 countries, and the forward convergence and reverse convergence of the Service Industry as well as the three major producer services(business services, transport, postal communication services) and Manufacturing Industry from the perspective of bidirectional integration, analyzing Chinese development and trends of industrial integration. Then this paper sets up panel model with 14 sub-sectors of manufacturing, and analysis the association between industry convergence and the performance of manufacturing industry. The empirical results show that the forward convergence and reverse convergence of the Service Industry and Manufacturing Industry have a significant effect on the performance of manufacturing industry. Although the forward convergence shows a better positive promoting on the performance of manufacturing industry than the reverse integration, as the constant adjustment of industrial structure, the power of the forward convergence becomes lower, and the power of the reverse convergence enhances.