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Author(s): |
Wen Xiao, College of Economics, Zhejiang University, Hangzhou, Zhejiang, 310027
Wenjing Fan, College of Economics, Zhejiang University, Hangzhou, Zhejiang, 310027
Liyun Liu, College of Economics, Zhejiang University, Hangzhou, Zhejiang, 310027;College of Management, Zhejiang Chinese Medical University, Hangzhou, Zhejiang, 310053 |
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Abstract: |
Based on the framework of Markusen (1989) and Marrewijk (1997), this paper models the interaction of producer services and manufacturing, and analyzes the characteristics and factors of the interaction, especially their influences on the development of producer services. Theoretical model analysis demonstrates that, in the interaction with the manufacturing sector, the development of producer services is influenced by the share of services input in the manufacturing sector，the scale of direct labor input in manufacturing firms, the output elasticity and the fixed costs of the producer services, the elasticity of substitution between producer services. Meanwhile, the different interaction mechanisms between socially optimal equilibrium and monopolistic-competition equilibrium have different effects on the development of producer services.
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