The growth of business services and the economic cycle

Abstract

Business services have become one of the most dynamic activities in modern economies. Their high growth rates in value added and employment support its outstanding position. The paper identifies short-term cyclical and long-term structural components in the business services growth. The relationship between business services and the economic cycle and the wide spectrum of reasons explaining structural growth are also analysed. The conclusions point out the importance of business services for economic progress of current economies. It seems that the structural component is more relevant than the cyclical one. The available data for some main OECD countries show that there is still a potential margin for further structural growth for business services. Some policies implications can be drawn from all this.