chapter  3
25 Pages

Intermediate services, economic restructuring, and urban transformation: Insights and prospects for China

ByTHOMAS A. HUTTON

Introduction: advanced services in comparative context Service industries, and more particularly specialized intermediate services (or advanced producer services (APS)) have among Western states emerged as the lead sectors of urban-regional economies since the 1970s, during the so-called postindustrial era. From playing essentially lubricating roles within manufacturing-based economies in the long era of the classic industrial city, circa 1850-1950, these specialized service industries (including banking, finance, and the full range of business services) perform propulsive functions in cities such as London, Paris, Milan, New York, Chicago, Los Angeles, Seattle, Toronto, and Sydney, among many others. These include the following first-order effects: (1) facilitating the flow of capital; (2) managing commodity trade flows between regions, states, and enterprises; (3) generating sales and revenues through export earnings (export base effects); (4) enhancing the efficiency of the production sector; (5) generating high-quality employment in professional, management, and technical occupations especially; and (6) contributing to competitive advantage in the case of cities and metropolitan regions having significant strengths in advanced producer services.