Focus on Expanding Service Consumption from the Characteristics of Service Products
2026-06-17
Expanding service consumption is an effective way for China's economy to improve quality and efficiency, and to smooth the domestic circulation. However, if we only discuss how to promote service consumption in terms of overall quantity, it is often difficult to delve into deeper issues. The fundamental reason why services are different from general goods is the particularity of their product attributes - the attributes of posterior and trust products not only shape the interaction between their supply and demand sides, but also determine the specific form of market failure they encounter, which in turn affects the direction of public policy efforts. Therefore, returning to the basic characteristics of service products and re examining the policy logic of expanding service consumption from a theoretical perspective is an indispensable foundational task.
Post inspection product attributes and reputation mechanism
The classification of products cannot be separated from Nelson's "search product experience product" dichotomy, as well as Darby and Kani's further expansion of the concept of "trust product". This classification reveals fundamental differences in the availability of information for different products before, during, and after purchase, which directly determine whether market mechanisms can operate smoothly. The tangible goods produced by the manufacturing industry are mostly typical search products: buyers can form more accurate quality expectations through various means before payment, so price reductions can often effectively expand sales. Service products are different. Due to their two basic characteristics of intangibility and synchronous production and consumption, the production and consumption processes of services are highly coupled in time and space. Consumers find it difficult to make accurate evaluations of service quality before purchasing, and can only form judgments after real experiences - this is exactly the meaning of "experience products" or more accurately, "post experience products".
The posterior product attributes profoundly influence the logic of service consumption decisions. Firstly, the price elasticity of service demand is usually significantly lower than that of manufacturing products. Consumers make multidimensional trade-offs between service price, quality, experience, environment, and process, and price reductions often mean a reduction in factor inputs, which may trigger doubts about quality. Secondly, information economics has long pointed out that in the posterior goods market, if the seller's information advantage is not effectively constrained, the "lemon market" phenomenon will emerge - high-quality services will exit due to the inability to be identified in advance, while low-quality services will occupy the market for a long time through information asymmetry, thus forming a reverse selection equilibrium of "bad money driving out good money". Thirdly, for the posterior product, induced advertising is more effective than informational advertising, which theoretically explains why the service consumption field is more prone to false recommendations, exaggerated advertising, online "planting grass" and offline "stepping on thunder" and other chaos.
The policy logic derived from this is very clear - to expand service consumption, it is necessary to pay attention to reducing the posterior risk of services to consumers, and the core mechanism is reputation. The reputation mechanism essentially transforms consumers' posterior information into public information that other consumers can refer to in advance, aggregating dispersed individual experiences into a market order infrastructure with public goods properties. However, precisely because of its public goods nature, the reputation mechanism is highly susceptible to erosion by free riders - the essence of behaviors such as brushing orders, false comments, and algorithm manipulation is the privatization and pollution of public goods. Therefore, purifying the service consumption environment and establishing a sound service consumption credit system are not simply market supervision affairs, but rather repairing a basic system with public goods characteristics.
Trust attributes and third-party signals
If the problem of post inspection products can be alleviated through the accumulation of consumer experience and the construction of reputation mechanisms, the issue of trust products is much more difficult. Professional services with high knowledge intensity, such as law, accounting, healthcare, education, and psychological counseling, are not only difficult to judge before consumption, but also difficult to accurately evaluate by consumers after consumption. Service providers have a natural advantage in providing quality information, while consumers voluntarily give up verification due to a lack of knowledge and technical expertise, or because the marginal cost of obtaining information exceeds its marginal value. At this point, information asymmetry extends from 'before' to 'after', and even if consumers complete a transaction, they cannot determine whether they are receiving high-quality or low-quality service.
The impact of trust attributes on market equilibrium is quite subtle. On the one hand, once consumers establish a trust relationship with specific service providers, they will form a strong consumption inertia - consumers are willing to avoid the cheapest services to avoid low-quality risks, so that prices are positively correlated with demand within a certain range. This provides a micro foundation for the high-quality development pattern of the service industry with "high quality and good price". On the other hand, the establishment of trust relationships requires a significant investment of specialized capital, and this relationship is quite fragile in an imperfect institutional environment. When there is a lack of regulation, the fees for high-quality and low-quality services often converge, and the phenomenon of overcharging for low-quality services is widespread. Service providers also lack incentives to continuously improve their quality. This is a typical form of failure in the trust product market.
Solving the issue of trust products from an institutional perspective cannot rely solely on the spontaneous evolution of the market. Due to the inability of consumers to independently complete quality assessments, the market's demand for trust signals must be supplied by third parties, and the credibility of third-party signals relies on a fair and transparent institutional environment and a complete judicial system as support. In this sense, the common function of promoting third-party service quality evaluation, establishing a sound service standard system, and improving and revising key standards related to personal health and property safety is to inject public information into the trust product market that consumers cannot obtain solely on their own. In addition, as a special trust signal, service brands can condense long-term accumulated quality commitments into easily recognizable symbols, which is equivalent to transforming the trust product into a search product. Therefore, building a Chinese service brand system with international influence is not only a micro approach to industrial upgrading, but also an institutional means to alleviate the failure of the trust product market.
Three main policy lines for expanding service consumption
Following the theoretical framework mentioned above, the policy approach of expanding service consumption naturally presents three interrelated main lines, which collectively point towards the improvement of the institutional environment. One is the systematic governance of information order. The attributes of the posterior product determine the public good status of the reputation mechanism. Therefore, efforts should be made to crack down on false advertising in key areas such as catering, tourism, and beauty industry, regulate the behavior of platforms in content review, algorithm recommendation, and targeted advertising, create unified rules for online rating and comment systems, establish regular monitoring and severe punishment mechanisms for violations such as brushing traffic, fake comments, and "moving" comments, and put reputation as a public good on a healthy track.
The second is the coordinated construction of credit system and rights protection mechanism. We should promote the public list of service quality information and the system of integrity archives, use big data technology to enrich the information sources of the credit system, encourage third-party credit evaluation, and improve the incentive and restraint mechanisms for enterprise trustworthiness; In response to the contradictions caused by the prepayment system, we will deepen reforms, open up channels for consumer complaints, and reduce the cost of safeguarding rights. These systems help to transform the individual accumulation of posterior information into credit capital shared by the whole society, and transform private signals in the trust goods market into public signals provided by third parties.
The third is the construction of the standard system and the long-term cultivation of the brand. We should implement a project to create high-quality services, guide enterprises to strengthen their brand awareness, develop a series of "China Service" standards, and promote voluntary certification pilot programs; At the same time, we will improve the legal system and mechanism for standardization, establish a mechanism for the revision and service inspection of key standards, support key enterprises to lead or participate in the revision of international and national standards, and cultivate service industry group standards that benchmark international advanced levels. The theoretical logic of these works is consistent - gradually transforming trust products into search products through standardization and branding, fundamentally reducing consumers' information screening costs.
In summary, expanding service consumption cannot simply rely on stimulus and subsidies. Only by placing service consumption in the economic perspective of the interaction between service product characteristics and institutional environment, can policy design avoid the fragmented tendency of treating the head and feet, and provide a solid micro foundation and institutional guarantee for promoting high-quality development of the service industry and smoothing the domestic circulation. (Outlook New Era)
Author: Liu Yi (director and researcher of the Service Economy and Internet Development Research Office of the Institute of Financial Strategy, Chinese Academy of Social Sciences)
Edit:Luoyu Responsible editor:Zhoushu
Source:cssn.cn
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