Understanding the Reasons for the Rapid Growth of Producer Services: Causing Factors and the Role of External Economies

다국어 초록 (Multilingual Abstract)

The rapid growth of producer services has attracted research interests in accordance with the growing role of these services in regional development. Even though it has been understood that a gap in the development level between the urban and rural area is closely related to the developmental level of producer services, but it has neglected to explain why producer service has grown so rapidly in the urban economy. The purpose of this study is to understand the reasons for the rapid growth of producer services, especially focusing on the causing factors and the role of external economies for the growth of these services. It has been clearly revealed that the growth of producer services is not determined by the lagging productivity of services or splintering service functions from manufacturing. That is rather closely related to structural changes in the economy such as organizations, markets, technologies and other social factors which are mostly developed in the urban area. Also, producer service growth is closely interrelated to the development of urbanization economies and agglomeration economies. Thus it is a cumulative effect between the development of urban external economies and the growth of producer services. Therefore, the promotion of a region to develop producer services is an essential and prior condition for regional growth, especially for the rural area.

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