A new route to the rapid growth of the service sector: rise of the standard of living

2019 ◽  
Vol 23 (4) ◽  
Author(s):  
Harutaka Takahashi ◽  
Kansho Piotr Otsubo
Keyword(s):  
Steady State ◽  
Structural Change ◽  
Rapid Growth ◽  
Service Sector ◽  
Structural Changes ◽  
Manufacturing Sector ◽  
Value Added ◽  
Standard Of Living ◽  
Living Standard ◽  
Intensity Effect

Abstract In the present study, we set up a continuous-time two-sector optimal growth model with services and manufacturing goods and then examine structural change: the rapid growth of the service sector. Earlier studies of structural changes can be separated into two categories: preference-driven and technology-driven. Here we introduce a new and distinct category of structural change: consumption externality identified as rise of the living standard. A key assumption is that (1) a representative consumer has a non-homothetic Stone–Geary type utility function with respect to manufacturing goods and that (2) its subsistence level will be regarded as the standard of living and will be affected by the average consumption of manufacturing goods, which also affects the consumption level of services. We also assume that the manufacturing sector is more capital-intensive than the service sector, which takes an important role in our proofs. Results show that a steady state equilibrium exists that is globally stable as well as saddle-point stable. Then, given certain production parameters in a steady state, there exists optimal steady state where the value-added and employment shares by service sector will dominate those of the manufacturing sector under the condition that external effects of the service sector dominates capital-intensity effect of the manufacturing sector. In other words, through the transition process, the service sector will dominate the manufacturing sector in the steady state.

Implementation of lean in IT SME company: an Italian case

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Marco Torri ◽  
Kaustav Kundu ◽  
Stefano Frecassetti ◽  
Matteo Rossini
Keyword(s):  
Manufacturing Industry ◽  
Service Sector ◽  
Manufacturing Sector ◽  
Single Case ◽  
Value Added ◽  
Lean Implementation ◽  
Content Type ◽  
Italian Case ◽  
Lean Practices

Purpose In spite of huge advancement of Lean in the manufacturing sector, its advantage in the service sector is not fully investigated. The purpose of this paper is to cover this gap in particular for the information technology (IT) sector through the implementation of the Lean philosophy in a small- and medium-sized enterprise (SME), operating in the IT sector. Design/methodology/approach A case study is conducted and following the A3 model, Lean is deployed in the case company. Data were collected through on-site interviews, waste sources were identified and then countermeasures for their reduction were proposed and adopted. Findings This study reveals that the implementation of the Lean practices in an SME operating in the IT sector offers good operative and financial results, thanks to the higher productivity obtained through the reduction of non-value-added activities. Research limitations/implications This paper reports a single case study, not enough to generalize the results. Moreover, more Lean tools and practices should be tested in IT companies to assess their effectiveness. Practical implications This paper increments the knowledge base for the application of Lean and A3 model outside the manufacturing industry. This paper should assist practitioners and consultants who have the desire to understand a better way of Lean implementation in fast-growing IT industry and in SME. Originality/value Research on Lean implementation in an SME company and in IT sector is scarce. This study aims to assess the efficiency of the adoption of Lean practices following the A3 model. The results could be highly valuable for similar companies (dimension or sector), especially those that are facing transition situations in terms of size and at the same time want to improve their operations performance, efficiency and avoid waste.

scholarly journals Sectoral Volatility, Development, and Governance: A Case Study of Pakistan

2006 ◽  
Vol 45 (4II) ◽  
pp. 797-817
Author(s):  
Toseef Azid ◽  
Naeem Khaliq ◽  
Muhammad Jamil
Keyword(s):  
Growth Rate ◽  
Structural Change ◽  
Service Sector ◽  
Structural Changes ◽  
Agricultural Sector ◽  
Green Revolution ◽  
Rate Of Growth ◽  
Agriculture Industry ◽  
The Future

Development of overall economy of any country largely depends upon the characteristics of different prominent sectors such as agriculture, industry, services, etc. Sharp structural change in prominent sectors are experienced by the Pakistan’s economy during the last four decades, in which industrial and service sector have exhibited an extra ordinary rate of growth, while the agricultural sector did not shown that rate of growth which was experienced during the time of green revolution. Due to these structural changes in the prominent sectors volatility of growth rate has been experienced by the economy. To the extent that most of the recent volatility in growth rate of GDP can be attributed to the increasing share of the some volatility of the some prominent sectors, the analysis of their volatility can be useful in providing some enlightenment on the factors behind this phenomenon and its implications for the formulation of the policy in the future.

scholarly journals Can Sectoral Re-allocation Explain the Jobless Growth? Empirical Evidence from Pakistan

2010 ◽  
Vol 49 (4II) ◽  
pp. 705-718 ◽  
Author(s):  
Azad Haider
Keyword(s):  
Structural Change ◽  
Empirical Evidence ◽  
Structural Changes ◽  
Manufacturing Sector ◽  
Industrial Sector ◽  
Foreign Technology ◽  
Industrial Sectors ◽  
Jobless Growth

The present paper discuss the nature of structural changes in employment to understand jobless growth in Pakistan for the period spanning over 1967-2008. In our work (elsewhere)1 analysing Pakistan at sectoral level to find underlying factors generating jobless growth, we found that Jobless growth in manufacturing sector was anticipated. Industrial sector has a significant importance in any economy across the glob. Recent changes in the use of capital—based foreign technology has resulted in substitution of labour with non-labour inputs such as capital. Employment shifts between industrial sectors are often witnessed as indicators of Structural change in an economy. In this paper we are more interested in the nature of structural change that took place in Pakistan economy over 1967-2008. We set to analyse four commonly used measures of sectoral reallocation proposed by Lilien (1982), Groshen and Potter (2003), Rissman (1997), and Aaronson, Rissman and Sullivan (2004). Findings of our work are suggesting that the economy of Pakistan underwent structural change during periods of recession and recovery. However, it does appear that structural changes were more pronounced at the time of 1969 recession than that of 1991 recession. A plausible explanation for this result might be significant shifts in employment from agriculture towards services sectors. We conclude, based on the evidence from our study, that sectoral reallocation is one of the major causes of jobless growth in Pakistan.

Informality and structural change: evidences from microenterprises in India's unorganised manufacturing sector

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shromona Ganguly
Keyword(s):  
Structural Change ◽  
Small Firm ◽  
Small Firms ◽  
Structural Changes ◽  
Manufacturing Sector ◽  
Labour Productivity ◽  
Capital Intensity ◽  
World Market ◽  
Productivity Analysis ◽  
Content Type

PurposeThis article analyses the structural change in microenterprises located at India's unorganised manufacturing sector in terms of output mix, choice of technique and productivity during the last few decades.Design/methodology/approachBased on data collected from a quinquennial survey of unorganised firms, this study attempts productivity analysis by using the growth accounting technique.FindingsThe paper finds that there is a significant structural change which has occurred in the small firm sector in Indian manufacturing. The share of capital-intensive industries has increased substantially in recent years. Further, though small firms are more labour intensive, the labour productivity and total productivity of these firms are very low. The falling labour productivity and rising capital intensity indicates replacement of labour with capital in Indian small firm sector.Practical implicationsLow productivity of the sector is a cause for concern and this needs to be addressed by making the sector more competitive in the world market. To achieve this, policies should be designed so that small firms reach the efficient scale of production.Originality/valueThis is the first paper which examines structural changes in the Indian MSME sector. The findings have strong implications for creation of a viable ecosystem of entrepreneurship in the country.

scholarly journals Die invloed van inligtingstegnologie op werkverskaffing in die Suid-Afrikaanse finansiële sektor

1992 ◽  
Vol 23 (1) ◽  
pp. 16-20
Author(s):  
Gideon S. Hom ◽  
Charles V.R. Wait
Keyword(s):  
Information Technology ◽  
South African ◽  
Service Sector ◽  
Manufacturing Sector ◽  
Value Added ◽  
Telecommunication Networks ◽  
Production Functions ◽  
Insurance Companies ◽  
Building Society ◽  
Building Societies

The influence or information technology on the provision of employment in the South African financial sectorThe higher levels of productivity in the manufacturing sector, as a result of the automation and other significant changes in production functions, often lead to fears of higher levels of unemployment, as certain types of labour could become redundant. The application of information technology in the form of computers, data banks and telecommunication networks has, to a great extent, contributed to the automation of routine functions, as well as to the integration of various production functions. The danger exists that a great number of workers released from the manufacturing sector are not always trained and suitable for employment in the service sector. In addition, there may not be sufficient employment opportunities to accommodate these workers. The influence of information technology on employment should, however, be considered in terms of the net effect of the three distinguishing effects of information technology on an economy, namely the process, product and organization effects. In South Africa, employment and value added increased in the building society and banking fields during the period 1980-89. Those increases are attributed specifically to the product effect. Since the eighties, banks, building societies and insurance companies have all started to market new and more products that are directly linked to information technology.

Structural Change and Growth of Manufacturing Industries in Punjab: Post-Reforms Analysis

2020 ◽  
pp. 389-396
Keyword(s):  
Structural Change ◽  
Large Scale ◽  
Structural Changes ◽  
Manufacturing Sector ◽  
Small Scale ◽  
Rapid Decline ◽  
Optimum Level ◽  
Current Crisis ◽  
Employment Opportunities ◽  
Unskilled Labour

After the economic reforms of July 1991, the process of structural change led to jumping from the primary sector of the economy to tertiary by surpassing the secondary sector in India and Punjab in particular. Indeed, this process led to a rapid decline in the capacity of the manufacturing sector to offer jobs and the limited scope of the modern services sector to absorb relatively unskilled labour that was displaced from agriculture, which resulted in uneven growth of the economy, and increased unemployment. The study analysed these structural changes and its implications on the growth of production and employment of the manufacturing sector in Punjab. It was found that since the 1990s, the growth of manufacturing sector in Punjab was stagnant, whereas the trends in production and employment were declining. So, to achieve the optimum level of employment opportunities and mitigate the current crisis looming in the state of Punjab, there is a need to design a mechanism for encouraging investments in manufacturing sector particularly, in small scale industries as these industries have a greater advantage over medium/large scale units, because it uses local inputs, creates more employment opportunities and needs less start-up capital than the latter.

scholarly journals Global Transformation of the Living Standards of Population in the Context of Spatial Transformations

2021 ◽  
Vol 92 ◽  
pp. 07049
Author(s):  
Yulia Polozhentseva
Keyword(s):  
Comparative Analysis ◽  
Value Added ◽  
Standard Of Living ◽  
Living Standard ◽  
Economic Space ◽  
The World ◽  
World Economic ◽  
Main Components ◽  
Global Indicators

Research background: The world is constantly changing, increasing the efficiency of economic processes and raising the standard of living of the population, but this development has an uneven tendency. The global transformation of socio-economic development provides an opportunity for the state to use all available potential in order to increase the level and quality of life of the population. Purpose of the article: The main purpose of the publication is to study the dynamics of the development of the living standard of the population, to conduct a comparative analysis of the global indicators characterizing it. Methods: The article provides a comparative analysis of countries, which makes it possible to structure the main components of the living standard of the population; the results of the rating assessment of world indices characterizing the standard of living of the population are systematized based on the methods of scientific knowledge, comparative and statistical analysis. Findings & Value added: The analysis of the dynamics of the main indicators of the standard of living of the population made it possible to identify the main trends in the influence of these indicators on the level of the country’s development. Based on the comparison and analysis of world indicators, the place of Russia in the world economic space has been determined and an analysis of their dynamics has been carried out. Measures have been systematized to regulate the development of the standard of living of the population, aimed at eliminating crisis situations and imbalances in their development.

scholarly journals Predicting the German Economy: Headline Survey Indices Under Test

2021 ◽  
Author(s):  
Robert Lehmann ◽  
Magnus Reif
Keyword(s):  
Gross Domestic Product ◽  
Private Sector ◽  
Service Sector ◽  
Predictive Power ◽  
Manufacturing Sector ◽  
German Economy ◽  
Value Added ◽  
Leading Indicators ◽  
European Research ◽  
Out Of Sample

AbstractThis analysis investigates the predictive power of the headline indices of the four most important German survey providers. We conduct an out-of-sample, real-time forecast experiment for growth of total and private sector gross domestic product and growth of gross value added in both the manufacturing and the service sector. All providers publish valuable leading indicators for both GDP measures, with some advantages for the ifo indicators and the Economic Sentiment Indicator, respectively. For the manufacturing sector, indicators provided by the ifo Institute are clearly superior. For the service sector, all indicators prove to have a similar nowcasting performance, whereas the Economic Sentiment Services of the Centre for European Research is preferable for one quarter-ahead predictions.

scholarly journals On the Priorities of Comparative Advantage of Agro-industry Commodities: the way towards Economic Transformation

2019 ◽  
Vol 6 (1) ◽  
pp. 13
Author(s):  
Yagoub Elryah
Keyword(s):  
Economic Development ◽  
Structural Change ◽  
Negative Impact ◽  
Manufacturing Sector ◽  
Value Added ◽  
Industrial Sector ◽  
Economic Transformation ◽  
Total Output ◽  
Total Employment ◽  
New Structural Economics

Economic development in Sudan has been facing more challenges than ever before in 2011 after South Sudan gets independence, where Sudan lost 75% from oil revenues. As a result, Sudan underwent structural reform that favored the concentrating in non-oil sector. Considering that agriculture has been largely contributing to the GDP, it seems that the main drivers’ of economic growth. One of the most important questions regarding the New Structural Economics framework is (a) why industrialization becomes one the most determinants of country’s economic development, (b) has Sudan’s economic structure change over the years from 1980-2015, and (c) what the nature of that change? The purpose of this work is to identify the priorities of agro-industry commodities that Sudan has to focus on. It develops theoretical framework to investigate the sectoral composition trends of output and employment, and discusses these on the New Structural Economics framework. This study adopted two empirical models to analyze the collected data, which are obtained from different sources. Many of the hypotheses were supported. Major findings of this study are as follows. The analysis of RCA and PAM revealed that Sudan had lower costs in producing of agricultural and agro-industries commodities, except textiles manufacturing. The share of industrial sector in total employment and total output has declined during 2001 and 2015 period. Further analysis reveals that structural change has a negative impact on Sudan’s economy and growth of labor productivity, the share of service in output has steadily increased, reflecting reallocation of employment away from agriculture towards service and trade activities. This study finds evidence of negative structural change on Sudan’s economy and the share of value added manufacturing sector has decreased dramatically.

scholarly journals Output, Value Added and Employment in the Small Scale Textile Industry

1975 ◽  
Vol 14 (1) ◽  
pp. 120-134
Author(s):  
Seemin Anwar
Keyword(s):  
Textile Industry ◽  
Large Scale ◽  
Structural Changes ◽  
Manufacturing Sector ◽  
National Income ◽  
Value Added ◽  
National Product ◽  
Small Scale ◽  
National Accounts ◽  
Rate Of Increase

The small scale manufacturing sector is in many ways the step-child of Pakistan's national income accounts. A number of sample surveys of the output and employment characteristics of small industries have been conducted, but no attempt has been made to apply these surveys, in a systematic fashion, to the measurement of the growth of output of this sector. In the absence of better information, compilers of Pakistan's national accounts simply assume that the small scale sector's contribution to the national product grows at the same rate as the population. However, given the rapid structural changes in large scale industry and the sharp fluctuations in the past decade in the rate of increase in the gross national product, it is unlikely that the small scale sector grew at such a uniform rate. The small scale manufacturing sector encompasses a wide array of highly differentiated economic activities and separate estimates of the value added annually by each of these activities is not feasible, in large part because the establishments in this sector rarely keep systematic records even for major items such as sales or employment. Even if firms kept records, it would be extremely difficult to monitor the thousands of existing establishments, much less keep track of firms leaving or entering the sector. Thus, any effort at sampling or regular census-taking in the small scale sector is likely to provide insufficient information from which to construct an annual index of production.

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