Servitization of Manufacturing and China's Power Status Upgrading of Global Value Network

24 Pages Posted: 9 Apr 2022

See all articles by Guangcan Huang

Guangcan Huang

Xi'an University of Posts and Telecommunications - School of Economics and Management; Northwest University - School of Economics and Management

Lili Ma

affiliation not provided to SSRN

Ziguang Xietian

affiliation not provided to SSRN

Xinxin Huang

affiliation not provided to SSRN

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Abstract

In the context of the great changes of the global value network pattern, the servitization of manufacturing has become an important strategy for the transformation and upgrading of multinational enterprises. China's manufacturing industry has been in the core area of the global value network, creating a lot of export value, but the quality of development needs to be improved. Especially, the servitization level and structure of China's manufacturing have a great space for development. The servitization level affects the international competitiveness of manufacturing enterprises, and their power status in the global value network depends on their international competitiveness to a large extent. Using value-added trade data, inter-country input-output tables and China's industrial economic data, this paper systematically studies the impact of servitization of manufacturing on the upgrading of power status in the global value network. The measurement results show that the servitization level of the manufacturing significantly improves the competitiveness of the export value-added, and then affects its core position in the global network. Heterogeneity studies show that both commercial and non-commercial servitization have positive impacts on the status of China's manufacturing in the global value network, but the difference is significant. The distance between service and production, and the development stage of service dominance are the main reasons for the difference. China's manufacturing enterprises should strengthen their own service-oriented transformation to improve the core competitiveness, and the government should innovate public service supply to carry out economic governance.

Keywords: Servitization of Manufacturing, Global Value Network, Power Status, International Competitiveness, Simultaneous Equations Model

Suggested Citation

Huang, Guangcan and Ma, Lili and Xietian, Ziguang and Huang, Xinxin, Servitization of Manufacturing and China's Power Status Upgrading of Global Value Network. Available at SSRN: https://ssrn.com/abstract=4079780 or http://dx.doi.org/10.2139/ssrn.4079780

Guangcan Huang (Contact Author)

Xi'an University of Posts and Telecommunications - School of Economics and Management ( email )

563, Chang'an South Road,
Yanta District
xi'an, Shaanxi 710061
China

Northwest University - School of Economics and Management ( email )

Xian, Shaanxi 029
China

Lili Ma

affiliation not provided to SSRN

Ziguang Xietian

affiliation not provided to SSRN ( email )

No Address Available

Xinxin Huang

affiliation not provided to SSRN ( email )

No Address Available

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