The Impact Of Service Trade Barriers On Manufacturing’s Participation In Global Value Chain Specialization

The international production and specialization pattern of global value chain(GVC)is a typical feature of current economic globalization.It is an urgent goal for countries all over the world that manufacturing industry participate in GVC specialization more deeply.Manufacturing servitization is an effective means to realize the transformation and upgrading of manufacturing industry,improve the international competitiveness,and climb up the high-end value chain.In the meantime,trade in services has developed rapidly.Various protection measures for trade in services are also emerging one after another.Compared with tariffs,anti-dumping and other means,the barriers to trade in services they cause are more hidden and diverse.Based on the previous fact,this paper demonstrates the effect of service trade barriers on manufacturing’s participation in GVC specialization.The paper analyzes the theoretical basis that service trade barriers affect manufacturing’s participation in GVC specialization from the effects of technological innovation,production costs,and resource allocation,and proposes that service trade barriers affect the manufacturing industry’s participation in GVC specialization through total factor productivity and intermediate product prices.This paper measures the service trade barriers of various countries by means of the tariff equivalent,and uses the WWYZ method and the UIBE global value chain database to measure the manufacturing GVC participation.An econometric model is constructed to empirically analyze the relationship between service trade barriers and manufacturing’s participation in GVC specialization,and draws conclusions and puts forward corresponding suggestions.After in-depth study of this paper,the following results are concluded: Firstly,the existence of service trade barriers has an adverse effect on manufacturing’s participation in GVC specialization.Service trade barriers will reduce the degree of manufacturing’s participation in global value chains specialization,and hinder the improvement of manufacturing’s status in the global value chain;secondly,service trade barriers have a heterogeneous effect on the manufacturing’s participation of the upstream and downstream in GVC specialization.From added value supply’s viewpoint,the negative effect of service trade barriers on the upstream GVC participation of the manufacturing is greater and more prominent.From added value demand’viewpoint,the negative effect of service trade barriers on the downstream GVC participation of the manufacturing is not prominent enough.Dividing the service sector according to factor intensity,the effect of trade barriers on technology-intensive service industries on manufacturing’s participation in GVC specialization is greater than that of capital-intensive service industries and labor-intensive service industries.If GVC participation is divided into simple participation and complex participation,service trade barrier has a more prominent adverse effect on manufacturing’s participation in simple GVC specialization than manufacturing’s participation in GVC complex specialization;thirdly,service trade barriers affect manufacturing’s participation in GVC specialization through two channels: reducing total factor productivity and increasing the price of intermediate goods.On the one hand,the existence of service trade barriers leads to the low utilization rate of resource endowments of enterprises,reducing total factor productivity,and on the other hand,it hinders the free competition of the service sector,resulting in high prices of service factors,and through the input-output effect,it increases the prices of intermediate inputs in manufacturing.The decrease in total factor productivity and the increase in the price of intermediate inputs will weaken the international competitiveness of manufacturing enterprises,which will adversely affect their participation in global value chains specialization.