Liu Chuan | Information and Communication Technology and Productivity Growth in the Value Chain
On the morning of December 4th, the 10th Annual Meeting of the China Council for the Study of International Trade (CTRG), hosted by the CTRG, organized by the Center for International Finance and Economics Research (CIFER) of the National Institute of Financial Research at Tsinghua University, and strongly supported by the School of Business of Shanghai University of Finance and Economics and the Shanghai Institute of International Finance and Economics, was successfully held. Liu Chuan, a doctoral student from Ruhr University Bochum, attended and shared his insights.He and his collaboratorsProfessor of Ruhr University BochumMarianne Saam's titleICT and Productivity Growth within Value Chains(Information and communication technologies and productivity growth in the value chain)The article.
Liu Chuan
Liu Chuan is a PhD student at Ruhr University Bochum. He began his PhD studies in the Department of Management and Economics at Ruhr University Bochum in 2017, while also working as a research and teaching assistant. His main research areas are structural transformation, production networks, and global value chains. Currently, his research focuses on macroeconomic models that consider input-output relationships.
In his presentation, Liu Chuan pointed out that since the mid-1990s, information and communication technologies (ICTs) have made significant contributions to labor productivity growth, primarily reflected in the improvement of total factor productivity in the ICT industry and the deepening of ICT capital in other sectors. Numerous studies have used growth accounting and econometric estimation methods to quantitatively analyze this contribution at the industry level. In this paper, Liu Chuan and his collaborators used a growth accounting method considering intermediate inputs to analyze the contribution of ICTs to labor productivity in the production of final products along the value chain. They utilized the world input-output tables from the WIOD database and ICT capital stock data from the EUKLEMS database.Liu Chuan and his collaboratorsIt calculates the contribution of all capital and labor factors applied to the production industry and intermediate inputs of the final product to labor productivity, particularly the contribution of information and communication technology capital.Liu Chuan and his collaboratorsThe study found that half of the capital deepening contribution of information and communication technology (ICT) to final products in the manufacturing sector comes from upstream industries, primarily knowledge-intensive service industries, and the majority of this contribution originates from the domestic rather than the foreign portion of the value chain. Additionally...Liu Chuan and his collaboratorsThe study found that the rapid growth of total factor productivity in the information and communication technology industry has a limited indirect contribution to the improvement of labor productivity in the final products of other industries.
Ma Hong
CTRG Vice Chairman and Associate Professor Ma Hong of the School of Economics and Management at Tsinghua University commented on Liu Chuan's article. He noted that while the article wasn't specifically about international trade, its approach was worth exploring. He raised several points: First, the article primarily used the growth calculation method, but many factors were not included. While it could decompose growth into several parts, it couldn't explain how much contributed to the change in Y. Second, the advantages and disadvantages of the two methods needed to be examined. If the study aimed to consider the impact, the contribution of total factor productivity (TFP) needed to be shown and how it could be incorporated into the production equation. Third, the article didn't address how computer service measurement was handled—was it a flow loss or a stock loss? Finally, Associate Professor Ma Hong raised his own question: since the research results focused more on the contribution of output growth than labor productivity, shouldn't the labor redistribution effect focus more on objective facts?
CTRG attendees and scholars