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• Article | Research Policy | October 2020

  The Supply Chain Economy: A New Industry Categorization for Understanding Innovation in Services

  Mercedes Delgado and Karen G. Mills

  An active debate has centered on the importance of manufacturing for driving innovation in the U.S. economy. This paper offers an alternative framework that focuses on the role of suppliers of goods and services (the “supply chain economy”) in national performance. We identify three conceptual attributes of suppliers that make them important for innovation: they produce specialized inputs; have more downstream linkages with other industries; and benefit especially from co-locating with their customers, creating externalities. Using the 2002 Benchmark Input-Output Accounts, we estimate a new industry categorization that separates supply chain (SC) industries (i.e., those that sell primarily to businesses or government) from business-to-consumer (B2C) industries (i.e., those that sell primarily to consumers). We find that the supply chain economy is a distinct and large segment of the economy that includes primarily service providers. The SC industries, especially traded services, have higher average wages than B2C industries. The supply chain economy also has higher innovative activity as captured by the concentration of the vast majority of STEM jobs (primarily in traded services) and patents (in manufacturing). Finally, we find that employment in the economy has evolved from manufacturing into two distinct types of services (1998–2015): SC Traded Services (with the highest STEM intensity and wages) versus B2C Main Street (with the lowest STEM intensity and wages).

  Keywords: supply chain industries; business-to-consumer industries; services; innovation; Economy; Framework; Supply Chain; Service Operations; Innovation and Invention; Economic Growth; United States;

  Citation:

  Delgado, Mercedes, and Karen G. Mills. "The Supply Chain Economy: A New Industry Categorization for Understanding Innovation in Services." Research Policy 49, no. 8 (October 2020).  View Details

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• Teaching Note | HBS Case Collection | September 2020

  First Aid Beauty Teaching Note

  Karen G. Mills and Annie Dang

  Teaching Note for HBS No. 319-082.

  Keywords: entrepreneurship; venture capital; term sheets; Decision Choices and Conditions; preferred shares; common stock; Beauty and Cosmetics Industry;

  Citation:

  Mills, Karen G., and Annie Dang. "First Aid Beauty Teaching Note." Harvard Business School Teaching Note 321-013, September 2020.  View Details

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• Background Note | HBS Case Collection | May 2019 (Revised September 2020)

  Demographic Changes for the Future of Work in Japan

  Joseph B. Fuller, Koji Everard and Naoko Jinjo

  Citation:

  Fuller, Joseph B., Koji Everard, and Naoko Jinjo. "Demographic Changes for the Future of Work in Japan." Harvard Business School Background Note 319-113, May 2019. (Revised September 2020.)  View Details

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