[PEN-L:2714] manufacturing vs. services

[dxk15@xxxxxxxxxxxxxxxxxx (dilek cetindamar karaomerlioglu)]

I really don't understand how to draw a line between services and
manufacturing and how it is used as if they are rival developments in an
economy. I am trying to find a way to express the sectorial differences and
understand the dynamic changes they are undergoing. If you share your
opinions, comments on the following questions with me, I will be happy.

1) it is widely told that the employment on services is increasing, and it
is declining in manufacturing. But don't many services, in fact, directly
related to production? For example, very crudely transportation (SIC 4);
trade (SIC 5); finance, insurance and real estate (SIC 6); and  business
services (SIC 75 & 87) may be defined as the complentary to manufacturing.
By adding these sectors to manufacturing, I found out that for example the
broadened manufacturing employment of Ohio has increased in the 1980's
instead of general belief that manufacturing sector lost employment. Then we
can comment that manufacturing is reshaped not lost its importance to services.

Moreover, there are some services which are not directly related to
manufacturing but themselves evolved into a new phase which became as if
they are manufacturer. For example, McDonalds shops reminds me factories,
since they are so much specialized and highly labor-intensive activities
(like assembly lines). So should we count them also manufacturers?

What about health services, don't they supply the reproduction of labour (an
input in manufacturing production) or repair of labour! (similar to the
maintenance of machines).

I read that the biggest input suppliers to GM(general motors) is insurance
companies, and the largest GM products is financial services(to sell its
cars, it gives financial aid to people). So what is the difference between
GM and a bank?

In short, I am not sure what kind of a criteria could be developed to
include which services in order to have a "broadened manufacturing sector"
(or a different name!)? For example, under "finance, insurance and real
state sector" is real estate connected to manufacturing? My answer is no, or
similary food stores under trade sector doesn't sound as manufacturing
related. So can there be some criteria for it?


2) In fact, perhaps we don't need to think of in terms of manufacturing and
services at all but as the whole economy. But, then, in terms of economic
policies, what should economists propose for economic development (favour
and support manufacturing against services?)?  How to respond the arguments
like [services increase, manufacturing dies, high-technology production is
good, rustbelt is dying, sunbelt is rising] ?


3) How is the surplus-value created in services and how can be measured? Is
there a surplus-value when a movie star earns millions of dollars only with
one movie? Is this a redistribution of surplus-value created somewhere???


before getting boring, let's stop.

dilek


Dilek Cetindamar Karaomerlioglu
The Center for Regional Economic Issues
Weatherhead School of Managament
Case Western Reserve University
311 Wickenden Hall
Cleveland, Ohio 44106

Email: dxk15@xxxxxxxxxxx