Trends In Labor Productivity In The Service Sector And Their Explanations

After China's reform and opening up,economic development has experienced rapid development for nearly 30 years and gradually grown into the world's second largest economy.With the rapid development of the economy,China's industrial structure has also undergone tremendous changes.One of its outstanding manifestations is that the proportion of added value and employment in service industry has been greatly increased,the proportion of added value in service industry has increased from 24.60% in 1978 to 51.6% in 2017,and the share of employment in service industry has increased from 12.20% in 1978 to 44.91% in 2017.The structure of service industry,employment effect,efficiency improvement and other issues have also become a common concern of all walks of life.Generally speaking,the so-called Baumol's cost disease in economics has also appeared in the process of rapid development of China's service industry.That is to say,in the process of rapid expansion of employment share and scale of service industry,its labor productivity has not shown an upward trend.However,in the process of rapid development of China's service industry,what is the extent of Baumol's cost disease in the service industry? Does the cause accord with the mechanism explanation of Baumol-Fuchs hypothesis? The empirical verification of this hypothesis will not only help to test the Baumol-Fuchs hypothesis itself,but also help to understand the characteristics of the evolution of China's service industry.Firstly,this paper combs the theoretical basis of labor productivity and employment structure in service industry,and focuses on Baumol and Fuchs' explanation of the mechanism of labor productivity stagnation in service industry.On the basis of Baumol's theory,this paper first makes a statistical description of the scale of service industry,the change of total employment and labor productivity in China.The statistical results show that China's service industry There are obvious characteristics of Baumol's cost disease in the industry.But what is the extent and cause of this syndrome? Is it consistent with Baumol Fox hypothesis? On the basis of Baumol's model,this paper divides service industry into life and producer services,and establishes a three-sector expansion model of Baumol's unbalanced growth based on the perspective of the internal structure of service industry,and carries out an empirical test with the relevant data of China's service industry from 2004 to 2017.The relevant conclusions of the empirical study are:(1)Baumol of China's service industry.Cost disease is mainly caused by the passive expansion of life service industry;(2)The direct reason for the emergence of Baumol cost disease is the slow increase of labor productivity in life service industry,which is largely caused by the characteristics of life service products;(3)the development of producer service industry can increase the labor productivity of its related industries and the whole service industry.High,is conducive to delay and reduce the "Baumol cost disease" effect.Based on the above conclusions,this paper puts forward the following suggestions:(1)actively develop producer services;(2)strengthen the relationship between producer services and other industries;(3)effectively improve the quality of life service industry practitioners;(4)improve the system construction and policy norms to build a good development environment for the development of service industry.