The Light and Shadow of the Fourth Industrial Revolution

Abstract

GDP growth of OECD member countries has gradually declined during the past 20 years, and advanced economies are expected to see relatively flat growth in the coming years. Among GDP growth factors, total factor productivity (TFP) is also declining in the 21st Century. Meanwhile, distribution of outcome from economic growth seems to be unfair and impartial. For example, in the U.S., the share of all income held by the top one percent wealthy class has been steadily growing since the mid-1970s, on the other hand, ordinary middle-class people feel that they can't expect a prosperous life for their children. Under such circumstances, many people believe that the Fourth Industrial Revolution should lead economic growth by creating new value and industry through interconnections between physical systems and digital Big Data, deriving from further development of disruptive and innovative technologies such as artificial intelligence, robotics and IoT. The Fourth Industrial Revolution is expected to reshape the economic, social and cultural context in which we live, and we might expect dazzling results. In a world where people, goods, information and money can freely travel back and forth, we have to establish an orderly system based upon international common rules and regulations. However, in the context of rising income disparity and continued decline of middle-class status, people feel strong distrust of existing politics and political leaders. As a consequence, anti-globalism, nationalism and unilateralism are emerging, and credence to common values such as liberalism, democracy and market economy is weakening. Today, technical innovation is progressing at a dizzying speed, and industry, government and academia across the globe should cooperatively and sincerely explore necessary action programs to govern new disruptive technologies in advance so that we can establish stable, sustainable and inclusive development of our society. Unless many hurdles are overcome through real global collaboration, many innovative ideas will be swept away, or implemented with serious negative side effects. We must tackle the truly challenging tasks in order to change the mindset of the middle class towards the expectation of a positive future for their children.