Service Economy and Service have become an important component of modern economy, the output value and employment structures have accounted for more than 70% in the share of developed countries. But Service,Service industry and Service Economy is the edge and subsidiary of Economics which without a corresponding of status and content. Services are only supplementary or subsidiary of Manufacturing in industrial structure theory of the new classical economics, and Services are the "residual" of Agriculture and Manufacturing. The contrast between Economic reality and economic theory is the meaning and purpose of this study lies.After simple review in Service Economy, and the difficulties defines in the intension of "service", Articles have a study along the two main in the services productivity and the service industry's "productivity" which means the role and contribution of economic development. Based on two categories of Services--individual or B2C (consumer) services and business or B2B (producer) services.Based on the study, Baumol model describes the problem of service productivity lag; Using Feenstra, Gold et al model to analyze the relationship between deepen in division of labor and the evolution of services; The article analyzed the business business/B2B service industry and the national industrial structure under the international division of labor by transaction cost theory, comparative advantage, value chain theory, outsourcing economics; The use of Grossman, Hart and Myerson of the principal-agent model, simulate and analysis Business/B2B service by the services continue to externalize from internal production, development and influencing factors; The study simulate and analysis the personal/B2C services industry and the impact factors of the scale of operations and feasibility by the queuing model of Cachon and Harker; The article analysis the affection per capita income and China Service Industry by econometric tools.This analysis consists of four parts:Part I, Chapter 3,4, on the productivity of service issues.Productivity of research is derived from the Baumol cost-disease model, the major attempts is to explore the many contentious of the services productivity:"Solow productivity paradox" shows that the accuracy of services output statistics should be improved? the objectivity on theory of Baumol cost disease model and so on. Compared the productivity measurement method between Kendrick, Solow, Denison, Jorgenson et al, found that different measurement methods of productivity differences that may arise, and the Matilde Mas, Javier Quesada's econometric model analysis that low level of productivity in ICT industry itself and the positive spillover effects of external economic related industries----"Productivity" level is high but the productivity is very low. The characteristics of ICT industry' productivity is on behalf of a number of services' scenarios.Individual/B2C service sector productivity analysis shows that productivity of service is the concept under "open" environment, that means service productivity is heavily dependent on the demand factors----strength of demand and economic density. It is very different meaning with industrial productivity under "closed" system of supply capacity of the estimates. Because the data is missing in the productivity of service sector, article have a development level in service is indirectly instead of services productivity, analysis the relationship between development of service industries and income levels, found a positive correlation relationship between the two but non-linear, and showed two distinct stages.This article attempts to open the black box of services "productivity" for the angle to Business/B2B services. The studies have shown that two "outsourcing" boom promote and develop the Business/B2B service. While the productivity levels of expanding business/B2B services sector are still low, however, Business/B2B services activities which are knowledge-intensive and frequent innovation have a greatly promote to other departments in improving productivity levels, positive external economic effects that means its high "productivity."Part II, Chapter 5,6, Background of the international division of Business/B2B service problems.The products and services under the global economic integration and international division of labor refinement, greatly promote the growth in Business/B2B service, "Smile curve" effect makes the major value-added activity of the product value chain transfer to Business/B2B service activities. The role of service sector's in the localization of economic activity, was such a secondary role as supplementary,support,cooperation and support for products value, now has increased as the principal creators in products value. In support of ICT and other industries, production processes to achieve a "fragmentation", product value chain is "slice" or a combination of separation, different "fragments" of the process performance the characteristics of different resource endowments. Multinational corporations in accordance with the principles of comparative advantage of low value-added "snippets"------processing and assembly processes "outsourcing" transferred out, they only engaged in high value-added "process"-----R&D,design,marketing,sale and other Business/B2B service activities, achieve production allocation around world, but also to promote the overall prosperity of the developed countries services industry and the industrial structure of the "service-oriented."Outsourcing has become the most important form of organization under the environment of new international division of labor, facilitate the international division of labor is from the intra-industry trade into the product/process trade era. The Business/B2B service activities with the characteristics of knowledge-intensive and innovation were embedded the "service" in the different "segments" to the product value chain throughout by outsourcing. made a great contribution to the creation in value of the product. The "fragmentation" of service activities or processes in service industry bring the growth of service outsourcing, promote the development of international trade in services.Part III, Chapter 7-8, the use of models to analyze Business/B2B services and Personal/B2C servicesIn this paper, the principal-agent model of Grossman, Hart (1983) and Myerson (1983) was used to simulation the production,evolution and development of outsourcing, have the conclusions that "outsourcing" of Knowledge-intensive service activities was affected by multiple factors e.g the level of development of the business/B2B services enterprises,the market competition status of the principal's product,intellectual property protection. The game model queuing of Cachon, Harker (2002) analysis also shows that personal/B2C services of service enterprises with ICT make service "production" activities "outsourced" to the customer, implement service virtualization product (that is, the virtual service), will greatly enhance the productivity of personal/B2C services business, to achieve personal/B2C services industry and large-scale operations, prevent individuals/B2C services Baumol "cost disease" occurred.Part IV, Chapter 9, empirical analysis and conlusionIn this paper, empirical data in services of China show, although China's service sector output and employment levels below the world average, also lower than most developing countries with similar income levels with China. But compared to other developing countries, China's deeper integration into the global division of labor, labor-intensive aspects of the manufacturing process is currently has a comparative advantage and trade interests in the area. Relatively high in China "industrial" level that is formation a complementary interaction pattern with Europe and other developed countries and the industrial "services". Industrialized countries were once achieve a situation of the history of the industrial structure, can not draw the conclusions slow development of China's service industry. But the global output of manufactured goods production and the status of great power status means to further enhance the value of the proportion of the industrial sector seems difficult to sustain, developming service industries to become irreplaceable choice. |