Scandinavian Working Papers in Business Administration

Working Papers,
Örebro University, School of Business

No 2015:1: Servification of Firms and Trade Policy Implications

Magnus Lodefalk ()
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Magnus Lodefalk: Örebro University School of Business, Postal: Örebro University, School of Business, SE - 701 82 ÖREBRO, Sweden

Abstract: In the OECD countries, the decline of manufacturing and its employment implications have long been matters of concern. Recently, policymakers in several countries have set out to achieve reindustrialization. The servicification of firms is related to these concerns and aspirations. However, servicification and particularly its role in trade policy have received limited attention. I review micro-level evidence and discuss implications. I find that imported, domestic and exported services are all important to contemporary firm competitiveness and participation in international value chains. Therefore, historic policymaking divides between trade in manufactures and services, between export and import interests, and among modes of supply are becoming less relevant. I conclude by suggesting potential steps forward.

Keywords: Servicification; services; manufacturing; deindustrialization; offshoring; onshoring; trade; trade policy; GATT; WTO; Mode 4

JEL-codes: F13; F15; L16; L24; L60; O14

44 pages, First version: January 12, 2015. Revised: May 17, 2016.

Note: Previous title: "Servification of Manufacturing Firms Makes Divides in Trade Policy-Making Antiquated"

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