Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/222696 
Year of Publication: 
2019
Series/Report no.: 
ADBI Working Paper Series No. 929
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
Using a decomposition approach on data collected by the Asian Productivity Organization (APO) as well as World Input-Output data, we show that in most Asian economies the services sector makes the largest contribution to labor productivity. Furthermore, we find evidence of a major reallocation of labor from agriculture directly to services, bypassing the manufacturing sector. This finding challenges the traditional view that countries in their economic development need to have their workforce employed first in manufacturing before switching to services. Lastly, the paper studies how different skill levels contribute to labor productivity growth. We find that high-skilled workers have contributed most to overall labor productivity growth in developing Asia. In services, high-skilled workers have mainly driven labor productivity, indicating that upskilling and training are instrumental in services-led development.
Subjects: 
labor productivity
manufacturing
services
skills
JEL: 
O11
J21
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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