Research on the Interaction of China’s Knowledge-Intensive Business Services and Manufacturing Upgrading

Abstract

KIBS is a kind of advanced production factor which could increase the added value and the productivity of manufacturing in the global value chain by industry association effect. This paper empirically tests the dynamic relationship between KIBS and manufacturing upgrading by VAR model. The results show that there is a long-term dynamic equilibrium and causal relationship between KIBS and manufacturing. The positive effect of the former on the latter is obvious and long-lasting.

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“…Within the service industry, knowledge-intensive business services (KIBS) demonstrate particularly high growth rates, including in developing countries [Janger et al, 2017]. In China, the added value created in KIBS industries grew more than fivefold between 2004 and 2014 [Fang et al, 2016]. KIBS rank among the most innovative sectors in the European Union's Community Innovation Survey (CIS).…”

Drivers for innovation in KIBS: evidence from Russia

“…Zhou, Kautonen and Wei (2015) reported that innovation activity in Chinese manufacturing firms became more intensive when they simultaneously used services from KIBS companies specialised in R&D, IT, marketing and management consultancy. Similarly, Wei and Zhou (2016) and Fang, Zhao and Zhang (2016) reported that KIBS inputs enhanced innovation activity in Chinese manufacturing. Moreover, this effect also occurs if one restricts the analysis to the sample of small and medium-sized manufacturing enterprises (Zhou, Kautonen, Wang & Wang, 2017).…”