Territorial Servitization and Manufacturing Productivity Growth in Mexico: A Spatial Panel Data Approach

Abstract

While most existing research on territorial servitization has focused on its potential to revitalize mature industrial regions, much less has been said about its potential to incentivize knowledge-driven changes in manufacturing across developing economies. This article contributes to this topic by analyzing evidence for territorial servitization processes in Mexico, adopting a spatial panel data model approach, which uncovers space-time patterns to local-regional servitization processes. Findings reveal servitization positively impacts manufacturing productivity. Results also signal the relevance of local industrial contexts, as well as firm conditions, as key factors to the presence of positive impacts on productivity due to KIBS-manufacturing linkages, or manufacturing servitization.