Servicification—defined as the services value added embodied in goods—has been studied mainly in manufacturing, but its role in agricultural exports is less understood. We measure servicification in agricultural exports and examine how it is associated with export performance, upstream linkages and upgrading-related proxies. Using trade-in-value-added accounting for 80 countries (1995–2022), we estimate two-way fixed-effects panel models with exporter-clustered standard errors. Higher servicification is associated with both larger and intermediate agricultural value-added exports within countries over time. Decompositions show that these relationships are driven by services produced domestically, which are a location-based measure that may include services supplied by foreign-owned affiliates operating locally. Foreign services value added is not systematically related to outcomes. Servicification is also associated with a smaller agriculture-to-economy value-added gap proxy, and embodied financial and Information and Communication Technology (ICT) services appear complementary. Labour-market results for a smaller subsample are suggestive of stronger links with skill-intensive employment shares at lower GDP per capita levels. Because reverse causality cannot be ruled out, the findings are interpreted as conditional associations that motivate future causal identification.
Roelfsema et al. (Thu,) studied this question.