The Quiet Revolution in Services by Dani Rodrik
While economists debate whether industrialization can still play its traditional growth-promoting role in the current global and technological context, services have unexpectedly become an engine for economic development around the world. For developing and developed economies alike, the timing could not be better.
CAMBRIDGE—In 2023, the University of Chicago economists Chang-Tai Hsieh and Esteban Rossi-Hansberg published a study showing that services in the United States were undergoing a radical transformation. Digital technologies and organizational innovations in retail, hospitality, personal services, and medical services, they argued, had enabled some firms to become much more productive and expand their presence in local markets previously served by smaller, less efficient establishments. It was an “industrial revolution in services.”
