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Boosting productivity in Korea's service sector - OECD Economic Surveys: Korea 2008

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  • Boosting productivity in Korea's service sector - OECD Economic Surveys: Korea 2008
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  • Organization for Economic Cooperation and Development (OECD)


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Title Boosting productivity in Korea's service sector - OECD Economic Surveys: Korea 2008
Similar Titles
Material Type Others
Author(English)

OECD

Publisher

Organization for Economic Cooperation and Development (OECD)

Date 2008
Language English
File Type Link
Subject Economy < General

Abstract

Labour productivity growth in the service sector has been low relative to manufacturing. This is explained in part by weak competition in services resulting from strict product market regulation and the low level of import penetration and inflows of foreign direct investment (FDI). Increasing productivity growth in the service sector, which accounts for 67% of employment and 58% of value added in Korea, is essential to sustain high potential growth. The priority is to strengthen competition by eliminating domestic entry barriers, accelerating regulatory reform, upgrading competition policy and reducing barriers to trade and inflows of FDI. Another challenge is to enhance the performance and accelerate the restructuring of small and medium-sized enterprises, which account for over 90% of service-sector employment. Furthermore, it is essential to boost productivity in service industries with high growth potential, such as telecommunications and financial and business services.