Research On The Impact Of Producer Services Opening On Sophistication Of China’s Manufacturing Exports

Since the reform and opening up,China has achieved rapid development of export trade and economy by virtue of its comparative advantages such as cheap labor and natural resources.However,manufacturing industry,as an important pillar of national economic development,still faces the development dilemma of "low-end lock".China’s manufacturing export sophisticated content fails to achieve the same level of improvement as export trade and economic development,and the practical problem that China has a big but not strong manufacturing power is very prominent.Producer services can be used as intermediate inputs to embed advanced factors of production in manufacturing,which has a profound impact on sophistication of manufacturing exports improving,global value chain climb and economic growth.Therefore,the role of producer services can’t be ignored if China wants to enhance sophistication of manufacturing exports and to raise the manufacturing power.In this context,it is particularly important to explore what role producer services opening plays in sophistication of China’s manufacturing exports.Based on this,starting from FDI in producer services,this paper focuses on the role of producer services opening in sophistication of China’s manufacturing exports.This paper first sorts out relevant studies on service industry opening,sophistication of exports and the impact of service industry opening on sophistication of manufacturing exports,and then reviews the literature to lay a foundation for the research content and direction of this paper.Secondly,based on the existing academic research,this paper makes a theoretical analysis of the influence mechanism of producer services opening on sophistication of China’s manufacturing exports.Then with using the amount of foreign direct investment which is commonly used in academic research,this paper innovates the measurement index of producer services opening on the basic of FDI Regulatory Restrictiveness Index.On this basis,using the methods of Zhang Yan et al.(2013)and Arnold et al.(2016)for reference,the opening permeability index of producer services is constructed to reflect the impact of producer services opening on manufacturing sectors.At the same time,with reference to the method of Hausmann et al.(2007),sophistication of China’s manufacturing exports is measured and analyzed.Thirdly,by referring to the research of Dai Xiang(201 1),this paper constructs an econometric model for empirical study.Besides,this paper carries out the robustness test and heterogeneity analysis on the results.In the heterogeneity analysis,the manufacturing industry is divided into labor-intensive manufacturing industry,capital-intensive manufacturing industry and technology-intensive manufacturing industry according to factor intensity,and the different impacts of producer services opening on the three types of China’s manufacturing industry are discussed.Finally,this paper summarizes research conclusions and put forward suggestions that China should develop the producer services,and expand the opening level of producer services.At the same time,China should pay attention to the introduction and cultivation of talents,and intensify efforts to introduce foreign direct investment and improve manufacturing export technology complexity,to achieve the transformation from "made in China" to "intelligent manufacturing in China".The results show that producer services opening in China is enlarging,and the impact of producer services opening on the manufacturing industry is deepening.Sophistication of China’s manufacturing exports is significantly improved,and the export structure is gradually optimized.But there are industry differences.Based on both actual utilized FDI amount and FDI Regulatory Restrictiveness Index,the empirical results show that producer services opening can significantly improve sophistication of China’s manufacturing exports.Heterogeneity analysis results show that the producer services opening plays a significant role in promoting sophistication of labor-intensive manufacturing,capital-intensive manufacturing and technology-intensive manufacturing exports.But the degree of promoting are not identical,and producer services opening has the strongest effect on capital-intensive manufacturing.