Service liberalization and productivity in high-tech firms: Evidence from China

Xuchao Li; Jing Zhao; Ruomeng Yang

doi:10.1111/roie.12745

Service liberalization and productivity in high-tech firms: Evidence from China

Xuchao Li, Jing Zhao^*, Ruomeng Yang

^*Corresponding author for this work

College of Business

Research output: Journal Publications and Reviews › RGC 21 - Publication in refereed journal › peer-review

3 Citations (Scopus)

Abstract

This article studies the relationship between service liberalization and the productivity of high-tech manufacturing. Examining the sudden relaxation of FDI regulation in several service sectors in China, this article finds that service liberalization improves high-tech firms' TFP. The effect is greater in non-SOEs, firms with a higher degree of service dependence, and firms located in regions with better institutional environments. Furthermore, after service liberalization, high-tech firms of all sizes have more outsourcing service expenditures and spend less on intermediate inputs. Only large-sized high-tech firms increase their R&D expenditures to improve production efficiency. © 2024 John Wiley & Sons Ltd.

Original language	English
Pages (from-to)	1607-1644
Journal	Review of International Economics
Volume	32
Issue number	4
Online published	25 Mar 2024
DOIs	https://doi.org/10.1111/roie.12745
Publication status	Published - Sept 2024

Funding

National Natural Science General FundProject, Grant/Award Number: 72273097

Research Keywords

high-tech manufacturing
service liberalization
TFP

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1111/roie.12745

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title = "Service liberalization and productivity in high-tech firms: Evidence from China",

abstract = "This article studies the relationship between service liberalization and the productivity of high-tech manufacturing. Examining the sudden relaxation of FDI regulation in several service sectors in China, this article finds that service liberalization improves high-tech firms' TFP. The effect is greater in non-SOEs, firms with a higher degree of service dependence, and firms located in regions with better institutional environments. Furthermore, after service liberalization, high-tech firms of all sizes have more outsourcing service expenditures and spend less on intermediate inputs. Only large-sized high-tech firms increase their R&D expenditures to improve production efficiency. {\textcopyright} 2024 John Wiley & Sons Ltd.",

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N2 - This article studies the relationship between service liberalization and the productivity of high-tech manufacturing. Examining the sudden relaxation of FDI regulation in several service sectors in China, this article finds that service liberalization improves high-tech firms' TFP. The effect is greater in non-SOEs, firms with a higher degree of service dependence, and firms located in regions with better institutional environments. Furthermore, after service liberalization, high-tech firms of all sizes have more outsourcing service expenditures and spend less on intermediate inputs. Only large-sized high-tech firms increase their R&D expenditures to improve production efficiency. © 2024 John Wiley & Sons Ltd.

AB - This article studies the relationship between service liberalization and the productivity of high-tech manufacturing. Examining the sudden relaxation of FDI regulation in several service sectors in China, this article finds that service liberalization improves high-tech firms' TFP. The effect is greater in non-SOEs, firms with a higher degree of service dependence, and firms located in regions with better institutional environments. Furthermore, after service liberalization, high-tech firms of all sizes have more outsourcing service expenditures and spend less on intermediate inputs. Only large-sized high-tech firms increase their R&D expenditures to improve production efficiency. © 2024 John Wiley & Sons Ltd.

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KW - service liberalization

KW - TFP

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DO - 10.1111/roie.12745

M3 - RGC 21 - Publication in refereed journal

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VL - 32

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EP - 1644

JO - Review of International Economics

JF - Review of International Economics

IS - 4

ER -

Service liberalization and productivity in high-tech firms: Evidence from China

Abstract

Funding

Research Keywords

UN SDGs

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