Multiple trends of tertiarization: A comparative input–output analysis of the service sector expansion between Brazil and United States

Abstract

The service sector expansion has shown to be a multiple trend process, producing distinct sectorial compositions. The present paper aims to make a comparison between two large economies in different stages of development with an extensive service sector (Brazil and United States), by focusing on final and intermediary demand changes and sectorial productivity as well. Input–output matrices for Brazil and United States were used and two applications were carried out: structural decomposition analysis and total factor productivity. Main results are as follows. Firstly, the growth in services was fostered by several factors, among which household consumption assumes an important role for both countries. Second, inter-industrial linkages play a major role only for United States. Thirdly, there is now evidence of cost disease for Brazil. Finally, productivity is lower in Brazil, nonetheless labor productivity increased above the average in some service sectors.

Keywords

• Tertiarization
• Input–output
• Development