New strategic approaches to gaining from emerging advanced manufacturing markets

Abstract

Advanced Manufacturing (AM) markets are a major factor of modern global growth which to a large extent determines countries’ competitiveness. This article discusses the structure and dynamics of the development of advanced manufacturing markets, as well as the specifics of the policies of the countries strengthening their positions in these markets, based on the analysis of international trade in products using advanced manufacturing technologies. The study shows that in the last decade there has been a noticeable structural shift in AM: Industry 4.0 is growing faster, and the key growth driver is the biotechnology market. Large innovative economies — USA, France, Japan — are being displaced from AM markets, while new industrialized countries — Korea, Taiwan, and fast-growing China — are becoming leaders. The new AM markets — Industry 4.0 — are characterized by a high concentration of knowledge in universities combined with a high activity of start-ups, while the relatively traditional AM markets — Industry 3.0 — show a higher concentration of production. The position of countries in Industry 4.0 markets is significantly related to the monopoly of new knowledge and the opportunities for its rapid commercialization in start-ups, while in Industry 3.0 markets the processes of leading firms’ specialization and use of scale are already more significant, and the research environment is becoming more competitive. Strengthening and/or optimizing the positions on AM markets becomes the most important challenge for modern industrial policy. On the one hand, the choice of target markets determines significant alternatives in industrial policy (e.g., betting on the creation of new knowledge or on the spread of advanced technology), on the other hand, the sensitivity of progress to the complementarity of changes forms the demand for a comprehensive industrial policy, combining elements of science and technology, innovation, investment, and human capital development policies.