This paper examines the semiconductor’s industry growing importance
as a strategic technology in the modern industrial system and in contemporary war
-
fare. It also analyzes this industry’s evolution in China and the Chinese semiconduc-
tor industrial policy over the last years. We review the Chinese interpretation of the
‘revolution in military affairs’ and China’s perception of its backwardness as well as
the possibilities of catch-up and evolution in the most sophisticated segments of this
productive chain through domestic firms and indigenous innovation.
This document compares the advanced manufacturing technology strategies, policies, and performances of China and the United States. It finds that China has risen rapidly in this area in recent decades through large government investments in education, research, and advanced manufacturing. While the US used to lead in areas like R&D spending and talent-driven innovation, China has progressed up the maturity path through reforms and is now the most competitive global manufacturer, outpacing countries like Germany and the US. The strategies, policies, and priorities around manufacturing process, technology adoption, new product development, and supply chain management in Asia including China show higher levels of implementation and focus on continuous improvement compared to North America.
U.S. Policy in Response to Scientific and Technology Advances in India and ChinaDevon Bull
This document provides a summary of U.S. policy responses to scientific and technological advances in India and China. It discusses the economic histories and systems of the U.S., China, and India. While the U.S. historically led in innovation, China and India have rapidly increased investment in research and development in recent decades. However, the U.S. still spends the most on R&D and has the most researchers. The document recommends policies like increasing STEM education funding and protecting intellectual property to help the U.S. maintain its competitive advantage in an increasingly competitive global innovation landscape.
The document discusses the transfer of technology (TT) from developed to developing countries and its potential effects. It makes three key points:
1) TT is most likely to result in "immiserizing growth" for least developed countries that produce goods not substitutable with developed countries' goods and have very inefficient domestic technology. However, upgrading specialization and comparative advantages can mitigate negative trade impacts.
2) For developing countries to benefit from globalization and foreign technology, they must improve infrastructure/skills to change specialization patterns. If costs of creating new industries are very high, immiserizing growth cannot be ruled out.
3) Countries like China have climbed the ladder of comparative advantages by reallocating labor
The United States has the largest and most technologically advanced economy in the world. While it only accounts for 4% of the global population, its GDP makes up 26% of total world output. The US has highly developed services, manufacturing, and agricultural sectors. It also has powerful natural resources, infrastructure, and a well-educated workforce. The economy grew steadily in the 1990s but experienced a recession in the early 2000s due to the technology sector crash. Major industries include machinery/engineering, agriculture, education, insurance, and energy/power.
Electricity crisis and manufacturing productivity in nigeria (1980 2008)Alexander Decker
This document summarizes a study that evaluated the impact of electricity crisis on manufacturing productivity in Nigeria from 1980-2008. The study found that:
1) Electricity generation during this period negatively impacted manufacturing productivity growth due to unnecessary government spending on non-productive sectors.
2) Capacity utilization had a positive relationship with manufacturing productivity, while government capital expenditure and electricity generation had negative relationships.
3) Inadequate and irregular electricity supply increased production costs and reduced manufacturing productivity in Nigeria.
The performance of manufacturing sector and utilization capacity in nigeriaorlhawahlay
This document is a research paper on the performance of Nigeria's manufacturing sector and capacity utilization between 1985-2009. It aims to assess capacity utilization in the manufacturing sector and identify factors influencing it. The paper finds that capacity utilization has declined in Nigeria, currently around 45%, due to challenges like poor infrastructure, high costs, and macroeconomic instability. Regression analysis indicates that inflation reduces capacity utilization while exchange rates, loans, and per capita income positively impact utilization. The paper concludes Nigeria must address infrastructure, costs, and policies to restore the manufacturing sector.
The document discusses China's competitive threat to Latin American countries. It notes that some Latin American countries worry about the threat due to China's low labor costs compared to countries like Mexico. The document then discusses different perspectives on whether trade should be viewed as competitive or beneficial. It analyzes trade data between 1990-2002 to measure the competitive threat between China and Latin American countries in different industry sectors. It finds that Mexico, Chile, Costa Rica and El Salvador face the greatest potential threat from China.
The Future of U.S. Manufacturing: A Change ManifestoCognizant
The document discusses factors that could lead to a resurgence of US manufacturing, including rising costs in China, the potential benefits of co-locating production and R&D, and the strengths of US manufacturing like productivity, innovation, and skilled workforce. It argues US manufacturing is well-positioned for growth if companies invest in new technologies and policymakers address issues like taxes and regulations.
This document compares the advanced manufacturing technology strategies, policies, and performances of China and the United States. It finds that China has risen rapidly in this area in recent decades through large government investments in education, research, and advanced manufacturing. While the US used to lead in areas like R&D spending and talent-driven innovation, China has progressed up the maturity path through reforms and is now the most competitive global manufacturer, outpacing countries like Germany and the US. The strategies, policies, and priorities around manufacturing process, technology adoption, new product development, and supply chain management in Asia including China show higher levels of implementation and focus on continuous improvement compared to North America.
U.S. Policy in Response to Scientific and Technology Advances in India and ChinaDevon Bull
This document provides a summary of U.S. policy responses to scientific and technological advances in India and China. It discusses the economic histories and systems of the U.S., China, and India. While the U.S. historically led in innovation, China and India have rapidly increased investment in research and development in recent decades. However, the U.S. still spends the most on R&D and has the most researchers. The document recommends policies like increasing STEM education funding and protecting intellectual property to help the U.S. maintain its competitive advantage in an increasingly competitive global innovation landscape.
The document discusses the transfer of technology (TT) from developed to developing countries and its potential effects. It makes three key points:
1) TT is most likely to result in "immiserizing growth" for least developed countries that produce goods not substitutable with developed countries' goods and have very inefficient domestic technology. However, upgrading specialization and comparative advantages can mitigate negative trade impacts.
2) For developing countries to benefit from globalization and foreign technology, they must improve infrastructure/skills to change specialization patterns. If costs of creating new industries are very high, immiserizing growth cannot be ruled out.
3) Countries like China have climbed the ladder of comparative advantages by reallocating labor
The United States has the largest and most technologically advanced economy in the world. While it only accounts for 4% of the global population, its GDP makes up 26% of total world output. The US has highly developed services, manufacturing, and agricultural sectors. It also has powerful natural resources, infrastructure, and a well-educated workforce. The economy grew steadily in the 1990s but experienced a recession in the early 2000s due to the technology sector crash. Major industries include machinery/engineering, agriculture, education, insurance, and energy/power.
Electricity crisis and manufacturing productivity in nigeria (1980 2008)Alexander Decker
This document summarizes a study that evaluated the impact of electricity crisis on manufacturing productivity in Nigeria from 1980-2008. The study found that:
1) Electricity generation during this period negatively impacted manufacturing productivity growth due to unnecessary government spending on non-productive sectors.
2) Capacity utilization had a positive relationship with manufacturing productivity, while government capital expenditure and electricity generation had negative relationships.
3) Inadequate and irregular electricity supply increased production costs and reduced manufacturing productivity in Nigeria.
The performance of manufacturing sector and utilization capacity in nigeriaorlhawahlay
This document is a research paper on the performance of Nigeria's manufacturing sector and capacity utilization between 1985-2009. It aims to assess capacity utilization in the manufacturing sector and identify factors influencing it. The paper finds that capacity utilization has declined in Nigeria, currently around 45%, due to challenges like poor infrastructure, high costs, and macroeconomic instability. Regression analysis indicates that inflation reduces capacity utilization while exchange rates, loans, and per capita income positively impact utilization. The paper concludes Nigeria must address infrastructure, costs, and policies to restore the manufacturing sector.
The document discusses China's competitive threat to Latin American countries. It notes that some Latin American countries worry about the threat due to China's low labor costs compared to countries like Mexico. The document then discusses different perspectives on whether trade should be viewed as competitive or beneficial. It analyzes trade data between 1990-2002 to measure the competitive threat between China and Latin American countries in different industry sectors. It finds that Mexico, Chile, Costa Rica and El Salvador face the greatest potential threat from China.
The Future of U.S. Manufacturing: A Change ManifestoCognizant
The document discusses factors that could lead to a resurgence of US manufacturing, including rising costs in China, the potential benefits of co-locating production and R&D, and the strengths of US manufacturing like productivity, innovation, and skilled workforce. It argues US manufacturing is well-positioned for growth if companies invest in new technologies and policymakers address issues like taxes and regulations.
OECD expert workshop on the measurement of public procurement of innovation. ...STIEAS
The document summarizes findings from a study examining the impact of public procurement on private sector innovation using US federal procurement data from 1999-2009. The main findings are:
1) Private sector R&D employment responds positively to increases in the technological content of public procurement contracts, as measured by the share of procurement spending in high-tech industries.
2) This suggests that shifts in the composition of government procurement toward more innovative, high-tech goods and services can stimulate private sector innovation.
3) Policymakers should consider how changes in the industry focus of public procurement may influence private sector R&D, in addition to traditional support programs like grants and tax credits. Public procurement can act as an effective, if
1. The document discusses technological and organizational change in the Italian cotton textile industry from the 1970s-1980s.
2. During this time, the industry underwent a process of modernization in response to increased global competition and changes in consumer demand, adopting new technologies like shuttleless looms and open-end spinning.
3. The typical structure of specialized, family-owned small firms in Italy was functional for implementing early technological changes but risks delaying adoption of more complex new information technologies requiring deeper organizational changes.
The document discusses three levels of innovation - high level (breakthrough discoveries), mid level (implementation of discoveries), and ground level (context-specific innovations to commercialize products). It argues that while high level innovations are important, sustained prosperity relies on innovations at all levels working together over many years in a complex system. As an example, it outlines the multi-decade process by which the transistor was developed from an initial discovery into a ubiquitous technology through innovations at multiple levels. It concludes that policies should focus on sustaining innovation broadly rather than favoring any particular level or form.
Macroeconomic Variables and Manufacturing Sector Output in Nigeriaijtsrd
Management of macroencomic variables has been noted as instrumental to a well performing manufacturing sector. This study thus examined the effect of macroencomic variables on the manufacturing sector in Nigeria within a liberalised economic era of 1986 to 2018. The Autoregressive Distributive Lag model was employed for data analysis. The results revealed that macroeconomic variables has 93 significant short run policy effect but no significant long run effects on manufacturing sector output in Nigeria. The endogenous dynamics of manufacturing sector previous year outputs exerted a significance influence on the macroeconomic variables long run relationship effect on current year. The explanatory variables suggested that money supply M2 , interest rate INTR and credit to private sector CPS exerted positive effects on manufacturing sector output at short term trends. The study thus posits that macroeconomic variables have varying levels of effects on the manufacturing sectors of Nigerian economy. The monetary authority should employ the monetary policy stance in a pattern that increases money supply in order to boost investment in manufacturing sector which would eventual bring about improved output to Nigeria. Dr. Loretta Anayo Ozuah "Macroeconomic Variables and Manufacturing Sector Output in Nigeria" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-2 , February 2021, URL: https://www.ijtsrd.com/papers/ijtsrd38420.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/38420/macroeconomic-variables-and-manufacturing-sector-output-in-nigeria/dr-loretta-anayo-ozuah
11.growth of industrial production in selected indian manufacturing industriesAlexander Decker
This document analyzes the growth of industrial production in selected Indian manufacturing industries between 1979-2004 to determine if it was driven by productivity growth or input accumulation. The key findings are:
1) Output growth in industries like steel, aluminum, cement, fertilizer, chemicals, and paper was mainly driven by input accumulation rather than productivity growth.
2) The growth rate of total factor productivity declined in most industries, especially during the post-reforms period of 1991-2004.
3) Economic reforms in the 1990s may have contributed to the changing pattern from productivity-driven growth to input-accumulation driven growth in these key Indian manufacturing sectors.
Growth of industrial production in selected indian manufacturing industriesAlexander Decker
This document summarizes a research article that examines the sources of output growth (productivity growth vs. input accumulation) in selected Indian manufacturing industries from 1979-2004. The study finds that:
1) Output growth in the industries studied was mainly driven by inputs accumulation, while the contribution of productivity growth was minimal or negative.
2) The growth rate of total factor productivity declined over time, especially during the post-reforms period beginning in 1991.
3) The changing pattern of output growth may be due to economic liberalization policies undertaken in the 1990s.
The document discusses the current state and future challenges of the US Information Technology industry. It states that while the US remains a major player globally, its competitive advantage has diminished as other countries increase investments and capabilities. The IT industry faces challenges such as maintaining a strong workforce, increasing foreign competition, and balancing various policy issues. Government, industry and academia must work together to ensure the US retains leadership in this important sector.
This was presented by Micheal Khan at the Innovation Festival at Spier Wine Estate on 8 and 9 March 2010. The sponsor was Cape Biotech Trust to raise funds for the Southern African Innovation Network (SAINe).
Working capital management and the performance of selected quoted manufacturi...Alexander Decker
This study examines the relationship between working capital management and the performance of selected quoted manufacturing companies in Nigeria from 2000-2009. Secondary data was collected from annual reports of 60 companies and analyzed using descriptive and inferential statistics. The results showed that average collection period and average payment period were positively related to profitability, while inventory turnover days and cash conversion cycle were negatively related. This implies reducing cash conversion cycle, inventory days, and net trading cycle can increase profits, while increasing average collection and payment periods can also boost profits. In conclusion, efficient working capital management affects the performance of manufacturing firms in Nigeria.
The Economic Commission for Latin America (ECLA) was right: scale-free comple...FGV Brazil
The main purpose of this paper is to apply big-data and scale-free complex network techniques to the study of world trade, with a specific focus on the investigation of ECLA and structuralist ideas. A secondary objective is to illustrate the potentialities of the use of the new science of complex networks in economics, in what has been recently referred to as an econophysics research agenda. We work with a trade network of 101 countries and 762 products (SITC-4) which generated 1,756,224 trade links in 2013. The empirical results based on network analysis and computational methods reported here point in the direction of what ECLA economists used to argue; countries with higher income per capita concentrate in producing and exporting manufactured and complex goods at the center of the trade network; countries with lower income per capita specialize in producing and exporting non-complex commodities at the network’s periphery.
Date: 2017-03
Authors:
Gala, Paulo
Camargo, Jhean Steffan Martines de
Freitas, Elton
The Japanese government has pursued science and technology policies since the 1960s to support the country's knowledge-based economy as Japan has few natural resources. Major policies include heavy investment in university research, setting strategic priorities in fields like life sciences and nanotechnology, and promoting industry-academia collaboration. These policies have contributed to Japan's highly competitive high-tech industries and positive trade balance in technologies. The government provides resources for business partners to connect through trade fairs and databases.
The Chinese growth trajectory from a Post Keynesian-Structuralist-Development...pkconference
This document analyzes China's growth trajectory from 1978-2012 using a Post Keynesian-Structuralist-Developmental framework. It finds that China's 10% annual growth over 30 years was driven by strong domestic demand, particularly investment. China strengthened interindustry linkages to build a diversified domestic production structure less constrained by balance of payments. Exports grew to enable imports for development while economic reforms integrated China into global markets at its own pace. The analysis uses input-output data to show China's transformation to investment-driven and export-oriented industry while consolidating growth sectors domestically.
This document discusses a model of technology evolution that considers how demand heterogeneity impacts product and process innovation over the technology lifecycle. The model suggests that differing consumer needs and willingness to pay influence whether firms focus on improving product functionality or lowering costs early on. Later, as the technology surpasses market needs, competition drives increasing performance at stable prices. This possible late stage has not been thoroughly explored but can be seen in electronics. The model is analyzed via computer simulation to explore how demand factors shape the traditional pattern of innovation over a technology's lifetime.
Determinants of Business Performance in the Nigerian Manufacturing Sectorijtsrd
This document summarizes a study that examined the determinants of business performance in Nigeria's manufacturing sector between 1980-2018. The study used secondary data from the Central Bank of Nigeria and an econometric model to analyze the impact of various macroeconomic variables (financial intermediation, infrastructure, market size, exchange rate, interest rate, and inflation rate) on business performance. The results found that financial intermediation, infrastructure, and market size had a positive impact on manufacturing, while exchange rate, interest rate, and inflation had a negative impact. All variables conformed to the study's expectations except infrastructure and inflation rate, and most were statistically significant, indicating they are good determinants of business performance in Nigerian manufacturing. The study recommends over
This document discusses several topics related to economics and human resources, including:
1. It outlines different economic systems and compares factors like controlled, capitalist, planned, and market-based systems.
2. It also discusses indicators used to measure economic performance and human development, such as GDP, GNP, GNH, and HDI.
3. Key concepts in economics are defined, like needs and wants, supply and demand, and different types of goods and factors of production.
Challenges Adversely Affecting the Performance of the Manufacturing Sector of...Dr. Amarjeet Singh
The manufacturing sector of Ghana is bedeviled with many challenges, both external and internal, ranging from poor regulatory environment to inadequate level of skilled labour. Manufacturing firms in Ghana were surveyed, using a sample size of 120, based on purposive sampling. The study was poised to determine those variables that were available and those that were not available in the firms and were a setback. In addition a rating scale was used to determine those that were more critical and could adversely affect the performance of the sector. The results revealed there were high rent costs (84.2%) and influx of foreign products (87.5%) as well as inadequate level of skilled labour (77.5). The study was also intended to determine which variable was critically challenging and its absence could affect the performance of the sector. Clearly, poor regulatory environment was ranked the highest on the part of external challenges while inadequate skilled labour was rank the highest on the part of internal challenges. It is therefore recommended that skills development should be the priority of manufacturing firms, with the aim of closing manufacturing skills gap. Further, the government should make conscious attempt to regulate the influx of foreign products into the country.
FASHION-DRIVEN TEXTILES AS A CRYSTAL OF A NEW STREAM FOR STAKEHOLDER CAPITALI...IJMIT JOURNAL
Fashion reflects changes in socio-economic and cultural life which, in turn, changes fashion, and apparel boosts such change. Thus, in response to a shift in people’s preferences from economic functionality to supra-functionality beyond an economic value, the fashion industry has been gaining momentum worldwide.
In the digital economy, the fashion industry is in the midst of global dynamic change stimulating volatility, velocity, variety and dynamism, which necessitate a digital solution.
Digital business leader Amazon has succeeded in constructing an R&D-driven disruptive businesss model. This can be attributed to a virtuous cycle among user-driven innovation, advancement of the Internet, co-emergence of soft innovation resources, and activation of a self-propagating function leading to supra-functionality satisfying user preferences.
Given a timely digital solution, the fashion industry reinforces this cycle which, in turn, advances the solution. Thus, broad stakeholder involvement betting on a higher level of R&D expecting the future prospects of the industry can be expected.
Based on a co-evolution analysis of the development trajectories of Amazon and the fashion industry, an insightful suggestion paving the way to stakeholder capitalism, essential for global business leaders, is thus provided.
This document summarizes a study examining the impact of regional integration on productivity in Brazil and Mexico. The study uses firm-level data from 1996-1999 in Brazil and 1993-1999 in Mexico to estimate total factor productivity growth. It finds that outward-oriented industries and firms exhibited faster productivity growth in both countries. Productivity growth was driven more by reallocation of resources to more efficient producers than by within-firm productivity gains. Trade and foreign direct investment were found to have a generally positive impact on productivity, with some differences between Brazil and Mexico.
This report analyzes cloud computing export markets for U.S. companies. It finds that the cloud computing industry continues to see healthy global expansion. The top three markets identified are Canada, Japan, and the United Kingdom based on factors like export data, policy environment, infrastructure, and adoption rates. Overall the industry faces challenges around data privacy but also opportunities in hybrid cloud solutions and increased business acceptance of cloud technologies.
A Special Study of Emerging Global Trends in Advanced ManufacturingSujeet TAMBE
This document summarizes a study on emerging global trends in advanced manufacturing. It identifies five converging trends driving advanced manufacturing, including the ubiquitous role of IT, reliance on modeling and simulation, accelerated innovation in global supply chains, rapid changeability in response to customers, and support for sustainable manufacturing. Emerging trends in semiconductors include continued silicon scaling and diversification of materials. Advanced materials and additive manufacturing also show potential. The study examines factors enabling advanced manufacturing and provides future scenarios over 20 years for semiconductors, advanced materials, additive manufacturing, and synthetic biology. It aims to understand trends, enabling factors, and future scenarios in these technologies and advanced manufacturing overall.
Framework for understanding quantum computing use cases from a multidisciplin...Anastasija Nikiforova
This presentation is a supplementary material for the article "Framework for understanding quantum computing use cases from a multidisciplinary perspective and future research directions" (Ukpabi, D.C., Karjaluoto, H., Botticher, A., Nikiforova, A., Petrescu, D.I., Schindler, P., Valtenbergs, V., Lehmann, L., & Yakaryılmaz, A) available at https://arxiv.org/ftp/arxiv/papers/2212/2212.13909.pdf. THe presentation, however, was delivered for QWorld Quantum Science Days 2023 | May 29-31.
OECD expert workshop on the measurement of public procurement of innovation. ...STIEAS
The document summarizes findings from a study examining the impact of public procurement on private sector innovation using US federal procurement data from 1999-2009. The main findings are:
1) Private sector R&D employment responds positively to increases in the technological content of public procurement contracts, as measured by the share of procurement spending in high-tech industries.
2) This suggests that shifts in the composition of government procurement toward more innovative, high-tech goods and services can stimulate private sector innovation.
3) Policymakers should consider how changes in the industry focus of public procurement may influence private sector R&D, in addition to traditional support programs like grants and tax credits. Public procurement can act as an effective, if
1. The document discusses technological and organizational change in the Italian cotton textile industry from the 1970s-1980s.
2. During this time, the industry underwent a process of modernization in response to increased global competition and changes in consumer demand, adopting new technologies like shuttleless looms and open-end spinning.
3. The typical structure of specialized, family-owned small firms in Italy was functional for implementing early technological changes but risks delaying adoption of more complex new information technologies requiring deeper organizational changes.
The document discusses three levels of innovation - high level (breakthrough discoveries), mid level (implementation of discoveries), and ground level (context-specific innovations to commercialize products). It argues that while high level innovations are important, sustained prosperity relies on innovations at all levels working together over many years in a complex system. As an example, it outlines the multi-decade process by which the transistor was developed from an initial discovery into a ubiquitous technology through innovations at multiple levels. It concludes that policies should focus on sustaining innovation broadly rather than favoring any particular level or form.
Macroeconomic Variables and Manufacturing Sector Output in Nigeriaijtsrd
Management of macroencomic variables has been noted as instrumental to a well performing manufacturing sector. This study thus examined the effect of macroencomic variables on the manufacturing sector in Nigeria within a liberalised economic era of 1986 to 2018. The Autoregressive Distributive Lag model was employed for data analysis. The results revealed that macroeconomic variables has 93 significant short run policy effect but no significant long run effects on manufacturing sector output in Nigeria. The endogenous dynamics of manufacturing sector previous year outputs exerted a significance influence on the macroeconomic variables long run relationship effect on current year. The explanatory variables suggested that money supply M2 , interest rate INTR and credit to private sector CPS exerted positive effects on manufacturing sector output at short term trends. The study thus posits that macroeconomic variables have varying levels of effects on the manufacturing sectors of Nigerian economy. The monetary authority should employ the monetary policy stance in a pattern that increases money supply in order to boost investment in manufacturing sector which would eventual bring about improved output to Nigeria. Dr. Loretta Anayo Ozuah "Macroeconomic Variables and Manufacturing Sector Output in Nigeria" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-2 , February 2021, URL: https://www.ijtsrd.com/papers/ijtsrd38420.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/38420/macroeconomic-variables-and-manufacturing-sector-output-in-nigeria/dr-loretta-anayo-ozuah
11.growth of industrial production in selected indian manufacturing industriesAlexander Decker
This document analyzes the growth of industrial production in selected Indian manufacturing industries between 1979-2004 to determine if it was driven by productivity growth or input accumulation. The key findings are:
1) Output growth in industries like steel, aluminum, cement, fertilizer, chemicals, and paper was mainly driven by input accumulation rather than productivity growth.
2) The growth rate of total factor productivity declined in most industries, especially during the post-reforms period of 1991-2004.
3) Economic reforms in the 1990s may have contributed to the changing pattern from productivity-driven growth to input-accumulation driven growth in these key Indian manufacturing sectors.
Growth of industrial production in selected indian manufacturing industriesAlexander Decker
This document summarizes a research article that examines the sources of output growth (productivity growth vs. input accumulation) in selected Indian manufacturing industries from 1979-2004. The study finds that:
1) Output growth in the industries studied was mainly driven by inputs accumulation, while the contribution of productivity growth was minimal or negative.
2) The growth rate of total factor productivity declined over time, especially during the post-reforms period beginning in 1991.
3) The changing pattern of output growth may be due to economic liberalization policies undertaken in the 1990s.
The document discusses the current state and future challenges of the US Information Technology industry. It states that while the US remains a major player globally, its competitive advantage has diminished as other countries increase investments and capabilities. The IT industry faces challenges such as maintaining a strong workforce, increasing foreign competition, and balancing various policy issues. Government, industry and academia must work together to ensure the US retains leadership in this important sector.
This was presented by Micheal Khan at the Innovation Festival at Spier Wine Estate on 8 and 9 March 2010. The sponsor was Cape Biotech Trust to raise funds for the Southern African Innovation Network (SAINe).
Working capital management and the performance of selected quoted manufacturi...Alexander Decker
This study examines the relationship between working capital management and the performance of selected quoted manufacturing companies in Nigeria from 2000-2009. Secondary data was collected from annual reports of 60 companies and analyzed using descriptive and inferential statistics. The results showed that average collection period and average payment period were positively related to profitability, while inventory turnover days and cash conversion cycle were negatively related. This implies reducing cash conversion cycle, inventory days, and net trading cycle can increase profits, while increasing average collection and payment periods can also boost profits. In conclusion, efficient working capital management affects the performance of manufacturing firms in Nigeria.
The Economic Commission for Latin America (ECLA) was right: scale-free comple...FGV Brazil
The main purpose of this paper is to apply big-data and scale-free complex network techniques to the study of world trade, with a specific focus on the investigation of ECLA and structuralist ideas. A secondary objective is to illustrate the potentialities of the use of the new science of complex networks in economics, in what has been recently referred to as an econophysics research agenda. We work with a trade network of 101 countries and 762 products (SITC-4) which generated 1,756,224 trade links in 2013. The empirical results based on network analysis and computational methods reported here point in the direction of what ECLA economists used to argue; countries with higher income per capita concentrate in producing and exporting manufactured and complex goods at the center of the trade network; countries with lower income per capita specialize in producing and exporting non-complex commodities at the network’s periphery.
Date: 2017-03
Authors:
Gala, Paulo
Camargo, Jhean Steffan Martines de
Freitas, Elton
The Japanese government has pursued science and technology policies since the 1960s to support the country's knowledge-based economy as Japan has few natural resources. Major policies include heavy investment in university research, setting strategic priorities in fields like life sciences and nanotechnology, and promoting industry-academia collaboration. These policies have contributed to Japan's highly competitive high-tech industries and positive trade balance in technologies. The government provides resources for business partners to connect through trade fairs and databases.
The Chinese growth trajectory from a Post Keynesian-Structuralist-Development...pkconference
This document analyzes China's growth trajectory from 1978-2012 using a Post Keynesian-Structuralist-Developmental framework. It finds that China's 10% annual growth over 30 years was driven by strong domestic demand, particularly investment. China strengthened interindustry linkages to build a diversified domestic production structure less constrained by balance of payments. Exports grew to enable imports for development while economic reforms integrated China into global markets at its own pace. The analysis uses input-output data to show China's transformation to investment-driven and export-oriented industry while consolidating growth sectors domestically.
This document discusses a model of technology evolution that considers how demand heterogeneity impacts product and process innovation over the technology lifecycle. The model suggests that differing consumer needs and willingness to pay influence whether firms focus on improving product functionality or lowering costs early on. Later, as the technology surpasses market needs, competition drives increasing performance at stable prices. This possible late stage has not been thoroughly explored but can be seen in electronics. The model is analyzed via computer simulation to explore how demand factors shape the traditional pattern of innovation over a technology's lifetime.
Determinants of Business Performance in the Nigerian Manufacturing Sectorijtsrd
This document summarizes a study that examined the determinants of business performance in Nigeria's manufacturing sector between 1980-2018. The study used secondary data from the Central Bank of Nigeria and an econometric model to analyze the impact of various macroeconomic variables (financial intermediation, infrastructure, market size, exchange rate, interest rate, and inflation rate) on business performance. The results found that financial intermediation, infrastructure, and market size had a positive impact on manufacturing, while exchange rate, interest rate, and inflation had a negative impact. All variables conformed to the study's expectations except infrastructure and inflation rate, and most were statistically significant, indicating they are good determinants of business performance in Nigerian manufacturing. The study recommends over
This document discusses several topics related to economics and human resources, including:
1. It outlines different economic systems and compares factors like controlled, capitalist, planned, and market-based systems.
2. It also discusses indicators used to measure economic performance and human development, such as GDP, GNP, GNH, and HDI.
3. Key concepts in economics are defined, like needs and wants, supply and demand, and different types of goods and factors of production.
Challenges Adversely Affecting the Performance of the Manufacturing Sector of...Dr. Amarjeet Singh
The manufacturing sector of Ghana is bedeviled with many challenges, both external and internal, ranging from poor regulatory environment to inadequate level of skilled labour. Manufacturing firms in Ghana were surveyed, using a sample size of 120, based on purposive sampling. The study was poised to determine those variables that were available and those that were not available in the firms and were a setback. In addition a rating scale was used to determine those that were more critical and could adversely affect the performance of the sector. The results revealed there were high rent costs (84.2%) and influx of foreign products (87.5%) as well as inadequate level of skilled labour (77.5). The study was also intended to determine which variable was critically challenging and its absence could affect the performance of the sector. Clearly, poor regulatory environment was ranked the highest on the part of external challenges while inadequate skilled labour was rank the highest on the part of internal challenges. It is therefore recommended that skills development should be the priority of manufacturing firms, with the aim of closing manufacturing skills gap. Further, the government should make conscious attempt to regulate the influx of foreign products into the country.
FASHION-DRIVEN TEXTILES AS A CRYSTAL OF A NEW STREAM FOR STAKEHOLDER CAPITALI...IJMIT JOURNAL
Fashion reflects changes in socio-economic and cultural life which, in turn, changes fashion, and apparel boosts such change. Thus, in response to a shift in people’s preferences from economic functionality to supra-functionality beyond an economic value, the fashion industry has been gaining momentum worldwide.
In the digital economy, the fashion industry is in the midst of global dynamic change stimulating volatility, velocity, variety and dynamism, which necessitate a digital solution.
Digital business leader Amazon has succeeded in constructing an R&D-driven disruptive businesss model. This can be attributed to a virtuous cycle among user-driven innovation, advancement of the Internet, co-emergence of soft innovation resources, and activation of a self-propagating function leading to supra-functionality satisfying user preferences.
Given a timely digital solution, the fashion industry reinforces this cycle which, in turn, advances the solution. Thus, broad stakeholder involvement betting on a higher level of R&D expecting the future prospects of the industry can be expected.
Based on a co-evolution analysis of the development trajectories of Amazon and the fashion industry, an insightful suggestion paving the way to stakeholder capitalism, essential for global business leaders, is thus provided.
This document summarizes a study examining the impact of regional integration on productivity in Brazil and Mexico. The study uses firm-level data from 1996-1999 in Brazil and 1993-1999 in Mexico to estimate total factor productivity growth. It finds that outward-oriented industries and firms exhibited faster productivity growth in both countries. Productivity growth was driven more by reallocation of resources to more efficient producers than by within-firm productivity gains. Trade and foreign direct investment were found to have a generally positive impact on productivity, with some differences between Brazil and Mexico.
This report analyzes cloud computing export markets for U.S. companies. It finds that the cloud computing industry continues to see healthy global expansion. The top three markets identified are Canada, Japan, and the United Kingdom based on factors like export data, policy environment, infrastructure, and adoption rates. Overall the industry faces challenges around data privacy but also opportunities in hybrid cloud solutions and increased business acceptance of cloud technologies.
A Special Study of Emerging Global Trends in Advanced ManufacturingSujeet TAMBE
This document summarizes a study on emerging global trends in advanced manufacturing. It identifies five converging trends driving advanced manufacturing, including the ubiquitous role of IT, reliance on modeling and simulation, accelerated innovation in global supply chains, rapid changeability in response to customers, and support for sustainable manufacturing. Emerging trends in semiconductors include continued silicon scaling and diversification of materials. Advanced materials and additive manufacturing also show potential. The study examines factors enabling advanced manufacturing and provides future scenarios over 20 years for semiconductors, advanced materials, additive manufacturing, and synthetic biology. It aims to understand trends, enabling factors, and future scenarios in these technologies and advanced manufacturing overall.
Framework for understanding quantum computing use cases from a multidisciplin...Anastasija Nikiforova
This presentation is a supplementary material for the article "Framework for understanding quantum computing use cases from a multidisciplinary perspective and future research directions" (Ukpabi, D.C., Karjaluoto, H., Botticher, A., Nikiforova, A., Petrescu, D.I., Schindler, P., Valtenbergs, V., Lehmann, L., & Yakaryılmaz, A) available at https://arxiv.org/ftp/arxiv/papers/2212/2212.13909.pdf. THe presentation, however, was delivered for QWorld Quantum Science Days 2023 | May 29-31.
Evaluation of technology, trade, and inclusive development: Chinese experiencesAkhilesh Chandra Prabhakar
The present study begins by surveying, broadly supports the assertion that technology, trade, sustainability and
development-led globalization is the path in the Chinese context not adequately paid to attention except with very few
original or significant contributions. This research examines the existing pattern in the areas of trade, technology,
investment with a view to locate in the development context in the era of globalization. This study also investigates
theories of trade, technology movement under capitalist paradigm along with the empirical one. The survey broadly
supports the frequent, through usually undocumented, assertion that China’s socialist market paradigm was not
different from the capitalist mode of production as tended to neglect and to which they had made few if any original or
significant contributions. Alongside, this study used secondary data and analyzed, where the results confirmed that
foreign direct investment (FDI), trade and economic growth indicated the presence of long-run sustainable equilibrium
relationship between them but created income inequality gap widely among people. It is, thus, important for
policymakers to remove obstacles and improve the respective absorptive capacity in order to reap maximized positive
inclusive development with equality basis.
This document summarizes a research paper on China's experiences with technology, trade, and inclusive development in the context of globalization. The research examined China's patterns of trade, technology, and investment to analyze their impact on development. It found that while foreign direct investment, trade, and economic growth were in long-run equilibrium, they also created a wide income inequality gap. The researchers conclude it is important for policymakers to address obstacles and improve absorptive capacity to maximize inclusive development and equality.
This document discusses trends in advanced manufacturing processes. It identifies five key converging trends: 1) the ubiquitous role of information technology, 2) reliance on modeling and simulation, 3) acceleration of innovation in supply chain management, 4) rapid changeability in response to customer needs, and 5) acceptance of sustainable manufacturing. The document then provides further details on information technology and modeling/simulation as two major trends driving advanced manufacturing.
This document provides an overview of a paper presentation on trends in advanced manufacturing processes. It discusses five converging trends in advanced manufacturing: 1) the ubiquitous role of information technology, 2) reliance on modeling and simulation, 3) acceleration of innovation in supply chain management, 4) rapid changeability of manufacturing, and 5) support for sustainable manufacturing. It also describes several non-traditional or advanced manufacturing processes, including electrical discharge machining (EDM), wire EDM, and 3D printing.
A research report from Ericsson and Imperial College London provides an overview of the key technological drivers currently shaping the future of media production, distribution and consumption.
Technology transfer in a global economyDavid B. Audretsch .docxssuserf9c51d
Technology transfer in a global economy
David B. Audretsch • Erik E. Lehmann • Mike Wright
Published online: 6 December 2012
! Springer Science+Business Media New York 2012
Abstract The emergence of new technologies is acting both as a driving force and an
enabling factor to globalization. At the same time, these technologies are changing rapidly,
shortening the life cycles of products and the underlying processes, and raising technology
costs. Technology transfer from academic and scientific institutions has thus transformed
into a strategic variable for companies and nations to cope with these challenges in a global
economy. This article introduces the rationale for the special issue on the role of tech-
nology transfer in a global economy. The paper summarizes the main topics and themes
covered by a selection of papers and keynotes presented at the annual conference of the
Technology Transfer Society in 2011, as well as providing some pointers towards a future
research agenda.
D. B. Audretsch
Indiana University, Bloomington, IN 47405, USA
e-mail: [email protected]
D. B. Audretsch
WHU Otto Beisheim School of Business, 56179 Valendar, Germany
E. E. Lehmann (&)
Department of Business and Economics, Augsburg University, Universitaetsstr. 16,
86159 Augsburg, Germany
e-mail: [email protected]
E. E. Lehmann
Global Business Management (GBM), Augsburg and CisAlpino Center for Comparative Studies
in Europe (CCSE), Bergamo, Italy
M. Wright
Centre for Management Buy-out Research, Imperial College Business School,
Exhibition Road, London SW7 2AZ, UK
e-mail: [email protected]
M. Wright
University of Ghent, Ghent, Belgium
123
J Technol Transf (2014) 39:301–312
DOI 10.1007/s10961-012-9283-6
Keywords Academic entrepreneurship ! Entrepreneurship policy ! Global networks !
Global clusters ! Intellectual property rights ! Universities ! Technology transfer !
Science parks
JEL Classification N31 ! O30 ! O31
1 Introduction
Recent decades are often characterized as the era of globalization—never before has such a
web of linkages and interconnections existed, including a worldwide system of production,
distribution, new structures and relationships (Acs and Preston 1997). Globalization
stimulates competition worldwide, forcing government to adopt market-oriented policies,
both domestically and internationally. Competition pressures producers to continually
innovate, improve quality and cost effectiveness of existing products. At the same time,
firms can no longer acquire nor afford all the technological and human resources they need.
This inhibits their ability to foster flexible relationships with other firms, and most
importantly, institutions, like universities. The result has been an increasing trend of
research over the last 25 years involving technology and knowledge transfers from
academic institutions to private industry (see e.g. Siegel and Wright 2013 for a review).
A first wave of academic research on technology transfer and globalizatio ...
This document discusses the debate around how a country's regime type (democratic vs authoritarian) impacts which country it imports artificial intelligence technologies from. It analyzes data from Stanford, Carnegie Endowment, and the World Bank and finds that while US AI exports are driven by regime type, with more exports to wealthy democracies, Chinese AI exports are not driven by regime type and supply a broader range of countries regardless of regime type or GDP. It also finds that more countries import surveillance and policing AI from the US than China, debunking the view that China dominates those areas. Overall economic and military factors are stronger determinants of US exports, while no clear pattern emerges for Chinese exports.
Technology change & the rise of new industriesJeffrey Funk
Using an analysis of many existing and emerging industries, this book (to be published by Stanford University Press) shows how one can analyze the timing of new industry formation. It does this by analyzing the improvements in cost and performance that have enabled new technologies to become economically feasible.
IRJET- Appropriate Technology and Economic Development of the Emerging NationsIRJET Journal
This document discusses appropriate technology and its role in the economic development of emerging nations. It makes three key points:
1. Appropriate technology is technology that is suitable for the environmental, cultural, and economic conditions of a country. It emphasizes factors like affordability, local resources, job creation, and environmental sustainability.
2. Appropriate technology is important for emerging nations struggling with problems like poverty and unemployment. It allows them to develop technologies that enhance productivity without displacing large amounts of labor.
3. When adopted by emerging nations, appropriate technology can help achieve development goals by being tailored to local conditions and priorities like resource use, infrastructure constraints, and skill levels. This helps emerging countries grow their economies in a
This document discusses the future of work in the Middle East, North Africa, and Turkey (MENAT) region driven by three disruptive forces: the Industrial Internet, Advanced Manufacturing, and the Global Brain. It finds that these forces provide opportunities to diversify economies, strengthen supply chains, create jobs, and improve standards of living. However, governments and businesses will need to adapt by investing in infrastructure, education, and talent to fully capitalize on these opportunities and ensure inclusive growth.
This document summarizes the key points from a presentation by Dipak K. Roy at the ECCSSA Conference 2013. It discusses several challenges facing the global economy, including the rise of China, economic instability, resource depletion, and demographic shifts. It also examines issues in the US economy like slowing productivity and job growth concentrated in less productive service sectors. The document advocates for reforms in higher education, including addressing deficiencies in standards and curriculum, improving accountability, and making the introductory curriculum more quantitative. It highlights the importance of leadership focused on principles rather than politics to drive meaningful and lasting change.
This document provides an overview of technology transfer and technology transfer models. It discusses:
1. Technology transfer has become increasingly important due to globalization and economic liberalization. It allows firms to profit from their technological assets through external exploitation.
2. There are various definitions of technology transfer depending on the context. Broadly, it refers to the movement of technology, knowledge, skills, and capital from one entity to another.
3. Common modes of technology transfer include material transfer, design transfer, and capacity transfer. More recently, models have emerged that view technology transfer occurring between the stages of technology generation by the transferor and technology assimilation by the transferee.
This document provides an overview of the global textile and garments industry and the end of quotas under the Multi-Fibre Arrangement (MFA). Key points include:
- The textile and garment industry represents a significant portion of global trade, with developing countries producing half of textile and nearly three-quarters of clothing exports.
- Many developing countries are highly dependent on garment exports for jobs and revenues, making their economies vulnerable.
- The MFA imposed quotas on textile and clothing exports from low-cost countries into markets like the US and EU from the 1960s to 2004 in order to protect domestic industries. This distorted global trade patterns.
- With the expiration of the
Horizon Scan: ICT and the future of utilitiesEricsson
A new research report from Ericsson and Imperial College London examines the effects of ICT in reshaping the future of energy utilities markets.
ICT will play a fundamental role in the disruption of energy utility structures by enabling innovative methods of connection and coordination among community-based renewable energy installations.
Ubiquitous, affordable digital technologies create numerous new entry points into highly centralized and regulated energy markets, allowing both smaller entrants and consumers to seize power from established utility providers.
ICT systems, centered until now on supplying energy from just a handful of large producers, will soon need to balance supply from thousands of networked devices.
Integration of data across complex supply chains will create new opportunities for traceability, improved insurance models and reduced risk of accidents and environmental disasters.
These are some of the key transformational forces identified in the latest report in a series of horizon scans outlining the potential impacts of ICT on various industries. Based on in-depth research in collaboration with Imperial College London, the report identifies some of the major operating boundaries of current versus emerging utility industry structures and the role that digital technologies may play in crossing these thresholds.
First we recognize we need to have consistent overall planning of clusters. The planning and development of industrial zones has not been determined on a balanced basis by industry and region. This is the main cause of the weakness in the development of social infrastructure for the development of industrial zones. Second, we need suitable training programs qualified for laborers and select professional advisers for proper projects. Last but not least, we need adding "product" in the concept of "goods and services" (to "products, goods and services” to ensure adequate adjustment of all stages of the business process - consumption as well as not omitted for new objects arising in business processes such as digital services and digital products. Also, Adding new regulations on international cooperation in dispute settlement disputes between consumers and foreign organizations and individuals, in which, principles of cooperation, scope of cooperation between consumer protection agencies used in countries.
The book pinpoints that the digital future is exposed to the danger of chaotic, unregulated growth, which constitutes a challenge for countries that still operate according to traditional economic models, and that public thinking in the Arab region in facing challenges still follows the "reaction methodology" and temporary solutions with short-term prospects, and that this is confirmed by the current international indicators of its competitiveness. The book proposes that in order to address this, visions and efforts should be based on strategies driven by scientific methods, and with it the Arab countries must develop a clear understanding of the main challenges before jumping to seize opportunities.
The book shows that it is fundamental for policymakers and decision-makers to have precise and accurate understanding of the intricate details in digital transformation initiatives and the role that modern technologies can play in changing the rules and systems of current practices, and in how to develop digitized, more innovative business models with which to build resilient and sustainable social economies and systems.
The book also draws on the current data and indicators of the global economy and that they are pushing to form a worrying picture of weaknesses in Arab countries, which in turn may threaten the stability of the entire region, especially with regard to the "cognitive decline" and “increasing unemployment rates” and “poor economic performance"; and that these challenges call for dealing with it as key strategic indicators that require urgent action plans; with emphasis that these plans need to be designed to reflect different ways of thinking and adapted to the nature of the requirements and challenges of the 21st century and treat them as forces and positive factors.
The book highlights the importance of accelerating the implementation of a set of initial reform projects to encourage the development of more dynamic and developed digital business environments in the Arab region, in parallel with the development of educational systems and healthcare, and strengthening agricultural capabilities to achieve food security targets, and focus on economies based on industry and production, and promoting the development of Arab digital platforms to support e-commerce practices.
The report is based on the automation process in the emerging world. As the world is growing towards the automation process, all these industries are utilizing the benefits of automation in the working process. With the help of a new automation technique, the working procedures are performing very fast and effectively. To use automation we just need a computer or a system. Some artificial software tools are there that need to be installed in the computers so the machine can perform the task. It gives us the benefit of fast operations. So automation and digital technology also be a blessing for total countries as they could conduct to receive in productivity which is finally the driver of improvement Ragavendra. K. (2020). Automation Process in Emerging World and its importance. International Journal on Orange Technologies, 1(2), 55-61. Retrieved from https://journals.researchparks.org/index.php/IJOT/article/view/526 Pdf Url: https://journals.researchparks.org/index.php/IJOT/article/view/526/502 Paper Url: https://journals.researchparks.org/index.php/IJOT/article/view/526
Similar to CHINESE INDUSTRIAL POLICY IN THE GEOPOLITICS OF THE INFORMATION AGE: THE CASE OF SEMICONDUCTORS (20)
Atualmente, diversos economistas das mais variadas origens e tendências argumentam que o Banco Central deve imprimir dinheiro para financiar o déficit público e zerar a taxa básica de juros para fazer políticas monetárias não convencionais, chamadas lá fora de Quantitative Easing (QE) e que consistem na compra de ativos privados e talvez até divida pública de prazos mais longos.
1) O artigo discute a evolução do conceito de Lei de Say no pensamento econômico, desde a versão original de Jean Baptiste Say até as interpretações clássicas, neoclássicas e da escola de Cambridge.
2) A versão original de Say tratava da identidade entre produção e consumo, onde toda produção gera demanda equivalente através dos salários pagos e do poder de compra gerado. Isso pressupunha a neutralidade da moeda e ausência de entesouramento.
3) Posteriormente, interpretações cl
The purpose of this paper is to contribute to an interpretation of Ricardo’s theory of foreign trade following the lead of Sraffa ́s own 1930 critique of Ricardo ́s alleged error and recently developed by other Sraffians. We argue that Ricardo assumed that trade happened at natural prices in each country. And once we take the process of gravitation towards those prices into account it follows that : (i) Ricardo’s theory is not incomplete, but fully determined so there is no need for price elastic demand functions, contrary to what John Stuart Mill argued; and (ii) in the simple cases of the examples of chapter 7 of Ricardo ́s Principles, the terms of trade are determined by the ratio of the given actually traded levels of reciprocal effectual demands.
Taking into account the pull-push debate on the weight that external or internal factors have on the behavior of capital flows and country-risk premium of developing economies, the aim of this article is to assess empirically the extent by which the push factors, linked to global liquidity and interest rates, (compared to country-specific factors) play on the changes in the risk premium of a set of countries of the periphery, in the period 1999-2019. This done using the methodology of Principal Component Analysis, which can relate the information from different countries to its common sources. We also test for a structural change in the premium risk series in 2003, by means of structural break tests. We find that push factors do play the predominant role in explaining country risk changes of our selected peripherical countries and that there was indeed a substantial general reduction in country risk premia after 2003, confirming that the external constraints of the periphery were significantly loosened by more favorable conditions in the international economy in the more recent period. The results are in line both with the view that cycles in peripherical economies are broadly subordinated to global financial cycles, in but also that such external conditions substantially improved compared to the 1990s.
This document analyzes Brazilian National Treasury primary auctions from the 2000s using a Modern Monetary Theory interpretation. It finds that:
1) The Brazilian government was always able to sell its treasury bonds and was not pressured into higher interest rates by bond markets or rating downgrades.
2) Downgrades by international rating agencies did not cause persistent pressure on auction rates or changes in bond sales volumes.
3) The Central Bank ensured liquidity for treasury bonds through repo operations, maintaining interest rate targets and guaranteeing demand for government bonds.
Taking into account the pull-push debate on the weight that external or internal factors have on the behavior of capital flows and country-risk premium of developing economies, the aim of this article is to assess empirically the extent by which the push factors, linked to global liquidity and interest rates, (compared to country-specific factors) play on the changes in the risk premium of a set of countries of the periphery, in the period 1999-2019. This done using the methodology of Principal Component Analysis, which can relate the information from different countries to its common sources. We also test for a structural change in the premium risk series in 2003, by means of structural break tests. We find that push factors do play the predominant role in explaining country risk changes of our selected peripherical countries and that there was indeed a substantial general reduction in country risk premia after 2003, confirming that the external constraints of the periphery were significantly loosened by more favorable conditions in the international economy in the more recent period. The results are in line both with the view that cycles in peripherical economies are broadly subordinated to global financial cycles, in but also that such external conditions substantially improved compared to the 1990s.
This paper extends the analysis of Haavelmo (1945), which derived the multiplier effect of a balanced budget expansion of public spending on aggregate demand and output. We first generalize Haavelmo's results showing that a fiscal expansion can have positive effects of demand and output even in the case of a relatively small primary surplus and establishing the general principle that what matters for fiscal policy to be expansionary is that the propensity to spend of those taxed should be lower that of the government and the recipients of government transfers. We also show that endogenizing business investment as a propensity to invest makes the traditional balanced budget multiplier to become greater than one. Moreover, if this propensity to invest changes over time and adjusts capacity to demand as in the sraffian supermultiplier demand led growth model, the net tax rate that balances the budget will tend to be lower the higher is the rate of growth of government spending, even in the presence of other private autonomous expenditures.
This paper extends the analysis of Haavelmo (1945), which derived the multiplier effect of a balanced budget expansion of public spending on aggregate demand and output. We first generalize Haavelmo´s results showing that a fiscal expansion can have positive effects of demand and output even in the case of a relatively small primary surplus and establishing the general principle that what matters for fiscal policy to be expansionary is that the propensity to spend of those taxed should be lower that of the government and the recipients of government transfers. We also show that endogenizing business investment as a propensity to invest makes the traditional balanced budget multiplier to become greater than one. Moreover, if this propensity to invest changes over time and adjusts capacity to demand as in the sraffian supermultiplier demand led growth model, the net tax rate that balances the budget will tend to be lower the higher is the rate of growth of government spending, even in the presence of other private autonomous expenditures.
Thirlwall’s law, given by the ratio of the rate of growth of exports to the income elasticity of imports is a key result of Balance of Payments (BOP) constrained long run growth models with balanced trade. Some authors have extended the analysis to incorporate long run net capital flows. We provide a critical evaluation on these efforts and propose an alternative approach to deal with long run external debt sustainability, based on two key features. First, we treat the external debt to exports ratio as the relevant indicator for the analysis of external debt sustainability. Second, we include an external credit constraint in the form of a maximum acceptable level of this ratio. The main results that emerge are that sustainable long run capital flows can positively affect the long run level of output, but not the rate of growth compatible with the BOP constraint, as exports must ultimately tend to grow at the same rate as imports. Therefore, Thirlwall’s law still holds.
(1) O documento discute a análise de Lara Resende sobre as ideias da Teoria Monetária Moderna (MMT) e propõe um arcabouço teórico alternativo baseado na abordagem do excedente.
(2) A análise de Lara Resende aceita o modelo do Novo Consenso, mas reconhece que não há restrições monetárias ou fiscais. No entanto, suas implicações de política econômica não decorrem desse modelo.
(3) O arcabouço teórico alternativo propõe
1. O documento apresenta um modelo matemático para analisar sistemas econômicos representados por matrizes que indicam insumos e horas de trabalho necessárias para a produção.
2. É definido o conceito de matrizes redutíveis e irredutíveis e apresentados teoremas sobre propriedades de matrizes irredutíveis como tendo um autovalor máximo único.
3. Explica como representar sistemas de preços com e sem excedente usando esse modelo, encontrando soluções relacionadas a autovalores e autovetores das matriz
1) O documento é uma tese de doutorado apresentada à Universidade Federal do Rio de Janeiro que analisa o crescimento liderado pela demanda na economia norte-americana nos anos 2000 a partir da abordagem do supermultiplicador sraffiano com inflação de ativos.
2) No primeiro capítulo, a tese faz uma crítica à abordagem da macroeconomia dos três saldos proposta por W. Godley, argumentando que ela tem inconsistências contábeis.
3) Em seguida, a tese apresenta o arcabouço teórico do
1) O documento discute as contribuições teóricas de Piero Sraffa à teoria do valor e distribuição.
2) Sraffa propôs retomar a abordagem clássica do excedente e criticou a abordagem marginalista neoclássica.
3) Ele mostrou que há uma relação inversa entre salário real e taxa de lucro para qualquer número de bens, confirmando os resultados clássicos.
Este documento é uma dissertação de mestrado que analisa criticamente os modelos neo-kaleckianos sobre como a competitividade internacional influencia a taxa de crescimento de uma economia aberta. O autor argumenta que esses modelos restringem excessivamente a relação entre taxa de câmbio e distribuição de renda e omitem fontes alternativas de desvalorização cambial. Além disso, eles podem permitir déficits comerciais permanentes sem mecanismos de ajuste e sugerem que a desvalorização pode piorar o déficit comercial.
1) O documento discute modelos pós-keynesianos de crescimento e distribuição de renda, comparando-os com a teoria da distribuição de Cambridge.
2) Nos modelos iniciais, o nível de produção e utilização da capacidade dependem negativamente da parcela de lucros, enquanto a taxa de lucro realizada é constante.
3) A teoria de Cambridge argumenta que a parcela de lucros é determinada endogenamente no longo prazo, variando positivamente com o grau de utilização da capacidade.
(1) Keynes criticou a suposição neoclássica de que a taxa de juros é flexível, argumentando que ela é determinada monetariamente e não se ajusta automaticamente para manter o pleno emprego. (2) Sraffa criticou a ideia de que há sempre substituição entre fatores, mostrando que com capital heterogêneo a intensidade do uso de um fator não se correlaciona necessariamente com seu preço. (3) Ambas as críticas questionam se os mecanismos propostos pela teoria neoclássica são suficientes para garant
1) O documento discute a Hipótese de Estagnação Secular (HES) e suas inconsistências teóricas ao analisá-la a partir de perspectivas neoclássicas e heterodoxas da teoria do crescimento econômico.
2) A HES sugere que economias avançadas enfrentam tendência de estagnação devido a fatores como baixo crescimento populacional, tecnológico e da produtividade que limitam o investimento.
3) O documento mostra que a HES apresenta inconsistências tanto na abordagem neo
O objetivo deste trabalho é discutir as causas principais da interrupção, a partir de 2015,do processo de crescimento com inclusão social que ocorreu na economia brasileira a partir de meados dos anos 2000, processo que chamaremos de “Breve Era de Ouro” da economia brasileira em alusão ao processo semelhante, porém bem mais longo e intenso, que ocorreu nos países centrais depois da Segunda Guerra Mundial até o inicio da década de 70 do século passado. Nossa analise se baseia em duas hipóteses centrais. A primeira é de que, por uma série de razões estruturais operando tanto no lado da oferta quanto da demanda de trabalho, este processo gerou, a despeito das taxas de crescimento da economia não terem sido muito elevadas,uma “revolução indesejada” no mercado de trabalho brasileiro entre 2004 e 2014, que reforçou muito o poder de barganha dos trabalhadores (particularmente os menos qualificados).Esta “revolução indesejada” gerou uma tendência dos salários reais crescerem continuamente acima do crescimento da produtividade, o que acirrou progressivamente o conflito distributivo e reduziu as margens e taxas de lucros das empresas.
Vicinity Jobs’ data includes more than three million 2023 OJPs and thousands of skills. Most skills appear in less than 0.02% of job postings, so most postings rely on a small subset of commonly used terms, like teamwork.
Laura Adkins-Hackett, Economist, LMIC, and Sukriti Trehan, Data Scientist, LMIC, presented their research exploring trends in the skills listed in OJPs to develop a deeper understanding of in-demand skills. This research project uses pointwise mutual information and other methods to extract more information about common skills from the relationships between skills, occupations and regions.
Confirmation of Payee (CoP) is a vital security measure adopted by financial institutions and payment service providers. Its core purpose is to confirm that the recipient’s name matches the information provided by the sender during a banking transaction, ensuring that funds are transferred to the correct payment account.
Confirmation of Payee was built to tackle the increasing numbers of APP Fraud and in the landscape of UK banking, the spectre of APP fraud looms large. In 2022, over £1.2 billion was stolen by fraudsters through authorised and unauthorised fraud, equivalent to more than £2,300 every minute. This statistic emphasises the urgent need for robust security measures like CoP. While over £1.2 billion was stolen through fraud in 2022, there was an eight per cent reduction compared to 2021 which highlights the positive outcomes obtained from the implementation of Confirmation of Payee. The number of fraud cases across the UK also decreased by four per cent to nearly three million cases during the same period; latest statistics from UK Finance.
In essence, Confirmation of Payee plays a pivotal role in digital banking, guaranteeing the flawless execution of banking transactions. It stands as a guardian against fraud and misallocation, demonstrating the commitment of financial institutions to safeguard their clients’ assets. The next time you engage in a banking transaction, remember the invaluable role of CoP in ensuring the security of your financial interests.
For more details, you can visit https://technoxander.com.
Madhya Pradesh, the "Heart of India," boasts a rich tapestry of culture and heritage, from ancient dynasties to modern developments. Explore its land records, historical landmarks, and vibrant traditions. From agricultural expanses to urban growth, Madhya Pradesh offers a unique blend of the ancient and modern.
The Impact of Generative AI and 4th Industrial RevolutionPaolo Maresca
This infographic explores the transformative power of Generative AI, a key driver of the 4th Industrial Revolution. Discover how Generative AI is revolutionizing industries, accelerating innovation, and shaping the future of work.
South Dakota State University degree offer diploma Transcriptynfqplhm
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New Visa Rules for Tourists and Students in Thailand | Amit Kakkar Easy VisaAmit Kakkar
Discover essential details about Thailand's recent visa policy changes, tailored for tourists and students. Amit Kakkar Easy Visa provides a comprehensive overview of new requirements, application processes, and tips to ensure a smooth transition for all travelers.
Abhay Bhutada, the Managing Director of Poonawalla Fincorp Limited, is an accomplished leader with over 15 years of experience in commercial and retail lending. A Qualified Chartered Accountant, he has been pivotal in leveraging technology to enhance financial services. Starting his career at Bank of India, he later founded TAB Capital Limited and co-founded Poonawalla Finance Private Limited, emphasizing digital lending. Under his leadership, Poonawalla Fincorp achieved a 'AAA' credit rating, integrating acquisitions and emphasizing corporate governance. Actively involved in industry forums and CSR initiatives, Abhay has been recognized with awards like "Young Entrepreneur of India 2017" and "40 under 40 Most Influential Leader for 2020-21." Personally, he values mindfulness, enjoys gardening, yoga, and sees every day as an opportunity for growth and improvement.
In a tight labour market, job-seekers gain bargaining power and leverage it into greater job quality—at least, that’s the conventional wisdom.
Michael, LMIC Economist, presented findings that reveal a weakened relationship between labour market tightness and job quality indicators following the pandemic. Labour market tightness coincided with growth in real wages for only a portion of workers: those in low-wage jobs requiring little education. Several factors—including labour market composition, worker and employer behaviour, and labour market practices—have contributed to the absence of worker benefits. These will be investigated further in future work.
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck mari...Donc Test
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TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
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CHINESE INDUSTRIAL POLICY IN THE GEOPOLITICS OF THE INFORMATION AGE: THE CASE OF SEMICONDUCTORS
1. MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Revista de Economia Contemporânea (2018) 22(1): p. 1-28
(Journal of Contemporary Economics)
ISSN 1980-5527
http://dx.doi.org/10.1590/198055272216
elocation - e182216
www.ie.ufrj.br/revista | www.scielo.br/rec
CHINESE INDUSTRIAL POLICY IN THE
GEOPOLITICS OF THE INFORMATION AGE:
THE CASE OF SEMICONDUCTORS*1
Esther Majerowicza
Carlos Aguiar de Medeirosb
a
Adjunct Professor at the Department of Economics-UFRN.
b
Associate Professor at the IE-UFRJ.
Manuscript received on 7/15/2017 and accepted for publication on 09/03/20182
ABSTRACT: This paper examines the semiconductor’s industry growing importance
as a strategic technology in the modern industrial system and in contemporary war-
fare. It also analyzes this industry’s evolution in China and the Chinese semiconduc-
tor industrial policy over the last years. We review the Chinese interpretation of the
‘revolution in military affairs’ and China’s perception of its backwardness as well as
the possibilities of catch-up and evolution in the most sophisticated segments of this
productive chain through domestic firms and indigenous innovation.
KEYWORDS: China; industrial policy; semiconductors; strategic trade; technologi-
cal change.
JEL CODE: O2.
Corresponding author: Esther Majerowicz
Contact information: estherzinhamj@yahoo.com.br
* The authors thank the agencies CAPES and CNPq for the financial support, as well as Eduardo Gustini
Simões, Ricardo Paes Mamede and the anonymous reviewers for their valuable comments and sugges-
tions. All errors are our own.
All the contents of this journal, except where otherwise noted, is licensed under a Creative Commons Attribution
License.
2. 2
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
A POLÍTICA INDUSTRIAL CHINESA NA
GEOPOLÍTICA DA ERA DA INFORMAÇÃO:
O CASO DOS SEMICONDUTORES
RESUMO: Esse artigo examina a crescente importância da indústria de semicondu
tores como uma tecnologia estratégica no moderno sistema industrial e na guerra con
temporânea, além de analisar a evolução desta indústria na China, bem como a política
industrial chinesa em semicondutores seguida nos últimos anos. Revisa-se a interpre-
tação chinesa da “revolução nos assuntos militares” e a percepção de seu atraso tecno-
lógico e possibilidades de catch-up e de evolução nos segmentos mais sofisticados desta
cadeia produtiva através de firmas domésticas e tecnologia autóctone.
PALAVRAS-CHAVE: China; política industrial; semicondutores; comércio estraté-
gico; mudança tecnológica.
3. 3
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
1. INTRODUCTION
Across the centuries, the control over technical progress has been an essential di-
mension of national power. Manufacturing and military might depend on national
technical capabilities to produce and create new goods, infrastructure and weapons.
Public investment in science and technology and other governmental industrial poli-
cies aimed to induce private investment in new industries and technologies have been
the most persistent and predominant (although not necessarily acknowledged) lever
for innovation and technical progress. Consequently, they have also been the lever for
national competitive advantage creation among advanced countries. These countries
systematically and politically exert control over new technologies, particularly those
of dual use (civil/military), through secrecy and exclusivist policies, such as power
policy.
In their efforts of industrialization, developing countries aim to reduce their tech-
nological backwardness through state-led industrial policies and fast growing invest-
ment rate. Technological catch-up by domestic firms through borrowing technologies
in import substitution production or by joint ventures with transnational corporations
– in areas where the barriers for importing technologies were higher – has been a
common dimension of industrialization followed by fast growth in East Asian coun-
tries (homespun or export-led), and particularly in China since its opening to the
international market. These technological opportunities were higher when different
generations of technologies prevailed, favoring diffusion, and lower when cumulative-
ness concentrated innovation capacity in leading economies. Hence, industrialization
through copy and borrowing technologies is easier in mature technologies, in those
that property rights are not restrictive and where low labor costs are a competitive
advantage. Industrialization through imitation faces growing difficulties when the
technological gap decreases and the barriers for importing technologies are higher,
particularly in those of dual use. In order to keep following a route of technological
catch-up and preserve national autonomy, developing countries face the necessity to
create a new industrial policy centered on the development of indigenous technologies
exploited by competitive domestic companies in high-tech activities.
Liberalization and high trade growth took place in the world economy in the last
three decades before the 2008 great crisis. In this period, the US and other “head-
quarter” countries organized deep global value chains (GVC) through transnational
corporations (TNC) encompassing vast populations occupied in low wage countries,
in productive stages in which wages were an important competitive edge. GVC led by
TNC have reshaped the world division of labor. The emergence of vertical production
networks was possible due to the progress of information and communications tech-
4. 4
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
nologies, as well as by economic liberalization in developing countries. Participating
in this web led by TNC was considered, in many countries, the new industrial policy.
Since 2008, lower rates of GDP and international trade growth prevailed, and,
despite the predominance of liberal thought and systematic opposition to industrial
policy as a development lever, industrial policy has been “back in”. In the US, Ger-
many, France, Japan, and South Korea it never ceased to be a strong lever; in China,
industrial policy achieved a high importance since the last decade. The diffusion of
new technologies, particularly information and communication technologies (ICT)
and their huge impact on cyber-physical industrial systems, as well as in new genera-
tions of weapons and war tactics, create systematic challenges for national power.
Electronic equipment (including electrical machines) and ICT, the greatest drivers
for high-tech industrial production, have a common feature: they depend crucially on
semiconductors, a high-tech input that demands complex process equipment for its
production. Electronic devices, smartphones and computers – the most demanded
downstream final goods – have to a substantial extent their differentiation based on the
capacity and reliability of semiconductors they contain inside, and the same happens
with weapons and defense sensor systems. Modern technological superiority depends
heavily on ICT. The capital goods necessary to produce and process high-powered
semiconductors are the highest high-tech upstream stage of modern technology. Few
countries dominate this technology and few companies produce high performance
semiconductors. The interactions among semiconductor manufacturing equipment
suppliers, semiconductor producers and its users (electronics and ICT) form a crucial
base for successful innovation in modern technologies.
China is nowadays a major producer of electronic, ICT products, and the great-
est importer of integrated circuits (IC), expressing its success in the fabrication of
these final goods (in stages distant from innovation and in which mature technologies
predominate) and simultaneously its technological backwardness and distance from
state-of-the-art semiconductor technology. The Chinese government considers this
technological gap an economic and national security threat.
This paper examines the Chinese degree of backwardness in semiconductors and
China’s perception of its implications for technological development and for national
security, as well as the industrial policies in semiconductors aimed to reduce it by
developing indigenous innovation and evolving in the industry’s productive chain.
In addition to this introduction, this paper contains other five sections. The second
section reviews the Chinese interpretation of the “revolution in military affairs”, its
reliance on semiconductors of high performance, the predominance of the US semi-
conductor transnational and the security threats associated to IC. The third section
examines some new directions in the modern manufacturing system stimulated by
5. 5
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
ICT, highlighting the importance of the productive system’s integration for productive
efficiency and the Chinese analysis of its backwardness. The fourth section considers
the global semiconductor industry, China’s position and the US leadership based on
security concerns. The fifth section regards China’s backwardness and high import-
dependence, and some efforts to promote import substitution, create domestic lead-
ers, investment funds and other policies aimed to acquire technology. The sixth sec-
tion concludes the paper.
2. SEMICONDUCTORS AND CONTEMPORARY WARFARE
Semiconductors are vital for modern warfare in multiple fronts, ranging from modern
weapons and battlefield operations to cybersecurity. As ICT has been driving the revo-
lution in military affairs, chips became a building block of defense capability, being
the foundation of modern systems of battle management, weapons, navigation, com-
munication and space, deemed in modern military affairs as force multipliers (CHU,
2013). Whereas possessing leading-edge semiconductors not available to rivals can
entail military-edge (PCAST, 2017), guaranteeing semiconductors’ integrity is essen-
tial for the proper operations of modern weapons and those systems dependent on in-
formation that sustain national defense (CHU, 2013), including to prevent foes’ access
and control. Therefore, in semiconductors, detaining technological lead, preserving
integrity and guaranteeing supply availability are national security concerns. As China
is far from the state-of-the-art semiconductor technology and depends heavily on IC
imports, all these aspects are paramount to the country.
In preparing for “local wars under conditions of informatization”, the People’s Lib-
eration Army (PLA) devised a military strategy based on the concept of asymmetrical
warfare, which mobilizes means beyond those narrowly deemed military to prompt
attacks and defeat technologically superior adversaries, particularly through informa-
tion warfare (RAUD, 2016; CHU, 2013). China has a broad and singular approach
to information warfare, fusing into a single discipline the two aspects of ICT-related
warfare, developed apart in the US1
, namely, electronic and cyber warfare (DICKSON,
2017), focused respectively on electronic equipment and data; while extending beyond
ICT to encompass “human information processing and cognitive space” (RAUD, 2016,
p. 10). In ICT-related warfare, semiconductors are of utmost importance. They are also
1
“In the U.S. military, electronic warfare and cyber capabilities live in different military domains, deliv-
ered by operators who exist in different military units and who largely grew up in different career fields”
(DICKSON, 2017).
6. 6
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
a target of Chinese ‘Assassin’s Mace weapons’, which seek to neutralize technological
superiority and defeat adversaries in asymmetrical warfare by attacking their greatest
vulnerabilities (PILLSBURY, 2001). Hence, semiconductors are a key in its military
modernization and strategy, be it to overcome or to offset its technological inferiority,
in conventional or asymmetrical warfare.
Semiconductors underpin what was assessed in China’s 2015 white paper on mili-
tary strategy as the “new stage” of the world revolution in military affairs, encom-
passing: (i) the sophistication of “long-range, precise, smart, stealthy, and unmanned
weapons”; (ii) the affirmation of cyber-space and outer space as the “new command-
ing heights in strategic competition”; (iii) the rapid evolution of the war form “to infor-
mationization”; and (iv) the military restructuring pursued by world powers, both in
its material and ideal dimensions (STATE COUNCIL, 2015a). In 2015, by the creation
of a new military branch, the Strategic Support Force, China demonstrated “the wea-
ponization of broad information capabilities, plus the weaponization of outer space”,
moving beyond its Assassin’s Mace program towards “fifth-generation warfare con-
cepts” (FISHER apud PHILIPP, 2017).
Furthermore, the core of contemporary hard military power, precision-guided
weapons2
, has its accuracy and reliability – and arguably feasibility – contingent on
semiconductor technology (CHU, 2013). Semiconductor technological lead can con-
substantiate superiority not only in precision force, but also in electronic warfare
(EW), which involves “the use of electromagnetic and directed energy to control the
electromagnetic spectrum or attack the enemy” (DoD, 2017, p. 80). Leading-edge
semiconductors’ usage in EW entails jamming communications and radars, compro-
mising command and control and improving stealth.
For instance, in 2016, the Department of Advanced Research Project Agency
(DARPA) announced a new chip (an analog to digital converter) funded by the agency
and developed in partnership with the US firm Global Foundries, described as having
“a processing speed nearly ten times that of commercially available, state-of-the-art
alternatives” (DARPA, 2016). Such technological advantage would provide anti-jam-
ming capabilities to overcome threats as seen in the conflict in Ukraine, where the
separatists employed EW against drones and communications “seriously hindering
battlefield operations for their opponent” (GIBBONS-NEFF, 2016)3
.
2
Includes “cruise missiles, ICBM [intercontinental ballistic missiles], and submarine-launched missiles”
(CHU, 2013, p. 39).
3
DARPA stresses that semiconductor technology advancements enabled “three major systems” under de-
velopment across the electromagnetic spectrum: the Navy’s “Next Generation Jammer”, to deceive radars
and protect assets; the “Air and Missile Defense Radar”, to search and track ballistic missiles; and the
“Space Fence”, augmenting small orbiting objects’ detection (DARPA, 2015).
7. 7
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
Whilst jamming blocks the functioning of devices, directed-energy weapons can
destroy semiconductors necessary for electronics’ operation. These weapons seek to
emulate the electromagnetic pulse (EMP) accompanying a nuclear explosion, which
can irreversibly destroy semiconductors without being “generally meant to kill peo-
ple” (SCHIESEL, 2003). Even if military and space chips are protected from nuclear
EMP through radiation-hardening, developments in directed-energy weapons oper-
ating in diverse ranges of the electromagnetic spectrum may render them vulnerable.
Furthermore, as most semiconductors used in a country are not radiation-hardened,
“EMP strikes may ‘deafen’ and ‘blind’ an entire country” (CHU, 2013, p. 44). In 2017,
China reported a breakthrough in directed-energy weapons: a high-power microwave
weapon that can destruct electronics by compromising IC, for instance, in tanks, mis-
siles or satellites; an Assassin’s Mace that granted the researcher behind it a first prize
National Science and Technology Progress Award (KANIA, 2017).
EMP strikes are not the only semiconductor-level threat. Inserting Trojan horses
in IC during design or fabrication can compromise not only weapons’ proper opera-
tion through performance restrictions and a diverse array of programmable failures,
as kill switches, but also cybersecurity by providing a back door to outsiders bypassing
all higher security levels. According to Schwartau (apud CHU, 2013), hypothetically,
malicious circuitry could be inserted in military systems sold to US customers by the
CIA/Pentagon, for instance, to trigger failure in a predetermined timeframe, to devi-
ate course or even to self-destroy after used4
. IC’s Trojans can also target consumer
electronics and critical infrastructure.
Security threats associated to IC have been the focus of a growing US concern, as
the US production and the global industry have been moving to China. Previously,
the industry’s globalization occurred mainly among military allies, since the major
global players are Japan, South Korea, Taiwan and Europe, besides the US. The US
Intelligence Advanced Research Projects Activity, in 2011, launched the Trusted IC
program (IARPA, 2011) to minimize the risks associated to foreign manufactured IC.
According to the Senate Committee on the US Military Forces (CAS, 2011), an inves-
tigation on counterfeit electronic parts in parcel of the supply chain of the Department
of Defense found 1.800 suspected cases, wherefrom a sample was tracked, 70% leading
to China. Apparently, counterfeits generally come from e-waste5
.
4
In 2017, in the aftermath of Xi Jinping’s visit to the US during rising tensions with North Korea, the lat-
ter’s failed missile test has prompted strong speculations on possible US sabotage (SANGER and BROAD,
2017).
5
“In an illustrative case, used and remarked semiconductors were sold as new by a Chinese firm, and they
were installed in unfreeze modules of a reconnaissance airship. The problem was detected during a flight
test” (ITA, 2016, p.27)
8. 8
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
While the US have security concerns on imported semiconductors from China,
even if the latter produces just a small share of global sales; the US semiconductor
giants’ (Intel and Qualcomm, along with the late IBM semiconductor division and Ap-
ple’s recently expanding one) have been directly implicated in the Global Surveillance
Program PRISM, unveiled by Edward Snowden. China, heavily reliant on imports,
mostly from the US and Japan, has a major vulnerability that the CCP set to tackle
through ambitious industrial policies.
3. SEMICONDUCTORS AND MANUFACTURING MODERNIZATION
It [the role of the IC industry] is similar to the role that the steel industry played in
supporting China’s earlier economic development […] We are now in the informa-
tion era […] If China is unable to develop its IC industry, then the national goal of
transforming our development model and industry structure will face a litany of
problems. (YE TIANCHUN, 2014, p. 2)
As high-tech building blocks of ICT products, semiconductors are fundamental for
downstream competitiveness in ICT, but also beyond. According to China’s Minister of
Industry and Information Technology, Miao Wei: “the scale and level of a country’s IC
development has become an important measurement of a country’s national competi-
tiveness and overall strength” (2014, p. 1). If semiconductors are at the ICT industry’s
heart, their economic importance become even more critical when informatization of
manufacturing and associated services is deemed by planners as the key to their overall
manufacturing (and economic) upgrade strategy, ultimately aimed at becoming the
world’s manufacturing leader by mid-century. The first step to this strategic goal was
launched in 2015, the ‘Made in China 2025’ (MIC, 2025) plan or ‘Manufacturing 2025’.
The plan characterizes that “the deep integration of next generation IT into manu-
facturing is triggering far-reaching industrial transformation”, a process that would
involve an industrial revolution, for “intelligent manufacturing, such as intelligent
equipment and plants based on cyber-physical systems [CPS], is creating a new manu-
facture revolution” (STATE COUNCIL, 2015, p. 3). In this spirit, the plan focuses on
raising China’s capacity in innovation, industrial quality and performance, while hav-
ing “the integration of the next-generation IT into manufacturing the main thread, in-
telligent manufacturing the main priority” and setting targets for industrial broadband
penetration, digital R&D and design tool penetration and key process control rate.
Therefore, semiconductors constitute a building block for China’s new comprehensive
manufacturing strategy.
9. 9
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
Implementing sensors and IC on objects enable them, respectively, to perceive the
environment, generating constant data status and position, and to compute and com-
municate the latter through the internet, promoting the digitalization and networking
of the physical elements in the Internet of Things (IoT). The information flow gener-
ated by the diffusion of the IoT requires network and communication infrastructure
as well as big data analytics, imposing the necessity for cloud computing. Also relying
on semiconductors for the sensing, computing and connecting – despite networking
not necessarily occurring through the Internet –, CPS encompass a virtual counterpart
of machines and objects to simulate the operations of physical elements. Instead of
merely monitoring objects through sensors, CPS have further emphasis on control,
acting upon the environment, being especially used in critical infrastructure: “CPSs
perform automated or partially automated control of physical equipment in manufac-
turing and chemical plants, electric utilities, distribution and transportation systems
and many other industries” (COLBERT, 2017, p. 41)
Both CPS and the IoT are at the core of what has been proclaimed as the fourth
industrial revolution, such as proposed by the Working Group of Germany’s govern-
mental “strategic initiative” Industrie 4.0 (KAGERMAN et al., 2013). Whether a fourth
industrial revolution is on course is beyond our scope6
. Of utmost importance is that
the concept is being instrumentally mobilized by major states in the pursuit of com-
prehensive industrial policies to defend or, in China’s case, to subvert the hierarchical
status quo in global manufacturing production and value appropriation in a context
of increased global competition. Undoubtedly, the widespread integration of ICT into
manufacturing and associate services, especially by the digitalization of physical ele-
ments, is at those projects’ core, extending the revolutionary effects of ICT on produc-
tion further than already experienced over the last decades.
The current stream of modernization in manufacturing and associate services is
characterized by the diffusion of information systems and the incorporation of pro-
ductive organizational strategies enabled by ICT technologies. The central question
for productive efficiency appears as its increasing dependence on the productive sys-
tem’s integration. “Smart” factories, cities and grid are enabled by semiconductors’ im-
plementation over physical structures, increasing their efficiency, yet exposing critical
civilian infrastructure to remote cyber threats.
Over the last years, China has become the world’s major consumption market for
semiconductors, particularly for IC, in consonance with its consolidation as the main
electronics’ producer and exporter, largely resulting from typical vertical specializa-
tion in CGV led/integrated by foreign TNCs. Nevertheless, semiconductor local pro-
6
For a critical perspective on the fourth industrial revolution’s discourse, see Pfeiffer (2017).
10. 10
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
duction and Chinese technological capabilities in IC still lag significantly behind its
consumption and the technological frontier, creating obstacles for the development
of Chinese-based high-end ICT goods. The lack of integration and complementarity
of China’s manufacturing structure has its ultimate manifestation in the enormous IC
domestic production-consumption gap met by imports. For these reasons, IC became
China’s main net import, surpassing crude oil. Considering the increased demands
posed by the manufacturing upgrade strategy of the world’s factory over IC’s provi-
sion, China’s position as the main semiconductor consumer is prone to strengthen.
Addressing these shortfalls in terms of production and technology is an emergency
task for the CCP to assure the overall success of its manufacturing and economic strat-
egy, as well as the security of intelligent factories, cities and grid.
IC, therefore, are a crucial element in the MIC’s “Four Foundations” or fundamen-
tal industrial capabilities, one of them being “essential spare parts and components”,
whose “weak industry foundation […] restrains Chinese manufacturing innovation
and quality improvement” (STATE COUNCIL, 2015, p. 16). In these parts and in ad-
vanced materials, MIC 2025 pursues increasing the domestic sourcing to 40% by 2020
and 70% by 2025. Not by chance, when assessing the need for achieving “breakthrough
in major areas”, the first sector that appears on MIC 2025 is “integrated circuits and
special equipment” in the area of “next generation IT”. Pursuing improvements that go
from design and intellectual property in design tools to mastering advanced packag-
ing and cultivating key manufacturing equipment providers, the plan seeks to achieve
“breakthroughs in core chips that are related to national information and network
security and complete electronic machine development to improve the adoption of
domestic chips” (STATE COUNCIL, 2015, p. 22). Notwithstanding, MIC 2025 is not
China’s only policy for IC, as discussed in section 5.
4. THE GLOBAL SEMICONDUCTOR INDUSTRY AND THE CHINESE POSITION7
The semiconductor industry8
is one of the world’s most capital-intensive, with high
R&D expenditures and fast technological progress9
. The extraordinary decline in
computer prices is greatly explained by the collapse of semiconductors’ prices with
simultaneous capacity improvement. This achievement was strongly based on tech-
7
This section is partially based on Majerowicz (2015).
8
Semiconductor devices represented a U$ 339 billion market in 2016 (SIA, 2017).
9
An IC state-of-the-art manufacturing facility (fab) costed between U$5 to 10 billion in 2016 (SIA, 2016a);
whereas the global industry-wide ratio of R&D expenditures to sales averaged 16% in the 2000-2014
period (ICINSIGHTS, 2016).
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MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
nical progress in machines used in semiconductors’ production. Thus, the modern
industrial system is formed by three high-tech sectors, semiconductors, machines
at upstream and computers (and other users, as smartphones and industrial control
systems) at downstream, with military demand for specific achievements in weapons
performance and features largely contributing to its rise while exerting pressure over
and supporting the system for technological progress, particularly through mission-
oriented projects. This system is split into different segments and stages according to
the scale, financial and technological barriers. In this system, only the US, Japan and
Germany headed all of its sectors and, therefore, are the ICT integrators. Notwith-
standing, when military demand is accounted for, the US appear as the single full ICT
integrator.
Whereas China is having great success in developing the downstream high-tech
sector, the control over the pace of technological progress in the modern industrial
system is strongly dependent on semiconductors and machines at upstream. This is
highlighted by Ye Tianchun: “China has vigorously developed its IT industry, but we
still import huge amounts of chips and equipment from abroad, and the pulse of de-
velopment is in the hands of other people” (2014, p. 2). The few countries that con-
trol technological progress and integrate the modern industrial system contrast with
the diversity of those involved in semiconductor production, many being mere sites
for TNC’s operations. Currently highly fragmented, the semiconductor industry was
one of the first to become global. The large variety of semiconductors components is
subsumed in two industrial segments: IC and optoelectronics-sensor-discrete devices.
Integrated circuits or chips, the “brains” of electronics, form the bulk of the semicon-
ductor market.
The IC value chain is divided in five stages: conception; design; the front-end of
fabrication or merely fabrication; assembly, packaging and testing (AP&T), the back-
end of fabrication; and customer services (GUTIERREZ and LEAL, 2004). Concep-
tion and design are skilled labor-intensive. Initially executed manually, they started
being performed using IC’s project software, the electronic design automation (EDA)
tools, in the early 1980s.
Fabrication is characterized by the intense usage of machinery. Front-end plants
(fabs) impose very high capital requirements – involving manufacturing operations
among the world’s most complexes – and “constant facility improvement to keep up
with technological advances”, while “successful manufacturers require high capacity
utilization (90 percent) and large-scale operations” (SIA, 2016a, p. 5).
Finally, AP&T, the simplest productive phase, is unskilled labor-intensive, “al-
though still relatively technologically sophisticated” (GAO, 2006, p. 4). According to
Gartner, in the global industry only 6% of workers employed in the back-end had
12. 12
MAJEROWICZ, E.; MEDEIROS, C.A. Chinese industrial policy in the geopolitics of the information age: the case of semiconductors
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engineering diplomas, contrasting to 24% in fabrication and 85% of higher educated
workers in design (WANG and WANG apud MAYS, 2013). Despite automation in
AP&T and advanced packaging technologies, fabrication’s high sophistication degree
makes back-end machinery look relatively cheap.
Originally, all enterprises were integrated device manufacturers (IDM), compris-
ing the entire productive process. IDM remain important contemporarily, and the
industry’s leaders, Intel and Samsung, are both IDM. The IC industry’s strategic sta-
tus informed its delocalization process, which, roughly, preserved in the headquarter
economies the higher value-added stages associated to technological development and
control, and the fabrication of products in the technological frontier. The fragmenta-
tion of the IC value chain started with AP&T delocalization to Asia. In the wake of
this intra-firm offshoring process, a new enterprise type emerged, the semiconductor
assembly and test services (SATS), commercializing their productive capacity and en-
abling back-end activities’ outsourcing.
The most significant value chain fragmentation, revolutionizing the industry’s en-
trepreneurial organization, occurred only with the advent of EDA tools. They enabled
fabrication’s detachment from design, affirmed by the emergence of fabless – firms
without fabs and AP&T plants –, pure-play foundries – enterprises detaining fabs that
commercialize their productive capacity to others – and design houses (MILLARD et
al., 2012).
Considerations for relocating front-end are distinct from back-end. In fabs, labor
is just 5% to 10% of total costs (SYKES and YINUG, 2006). Front-end offshoring
tends to occur in less sophisticated ICs, maintaining home those plants with the lat-
est process technologies and most sophisticated products, while in AP&T offshoring
generalizes despite the product. IDMs’ recalcitrance to offshore the most advanced
fabs, sometimes limited/prohibited by governments, can be related to fabrication’s
importance to innovation and to technological learning in IC. Regarding the design
segment and R&D, whereas delocalization may respond to talent availability and to
cheaper skilled labor, the proximity to consumers is an important parameter, enabling
to better respond to client specifications and adapt products to particular markets.
R&D labs holding fabs that run new process technologies, however, are prone to re-
main home.
To integrate in this GVC beyond assembly, a latecomer must count with domestic
efforts to develop fabrication as well as significant talents and skilled laborers avail-
ability to carry on design, whereas having a sizeable domestic market may open in-
tegration roads unavailable to small economies. Initially assembly sites, some Asian
economies, notably South Korea and Taiwan, managed to move-up in the value chain,
whilst others, such as Malaysia, have not. China’s main roles to the global industry
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contemporarily are of prime consumer and assembler of ICs, with foreign firms’ pre-
dominating in both supply to and production in China.
Although global, the semiconductor industry is controlled by a handful of mili-
tary allied economies. The role of military requirements and support were particularly
important to the industry’s rise and geographical dispersion. Industrial policy and
strategic trade were fundamental for its birth in the US and the subsequent entrance
of the major world market players. They were also paramount to defend industrial
leadership in periods of increased international competition. In the semiconductor
industry’s evolution, governmental support has been decisive.
Despite US commercial firms inventing the transistor in 1947, and the IC, proto-
typed in 1958 (Texas Instruments) and produced for commercialization in 1961 (Fair-
child) (MILLARD et al., 2012), the US governmental support, particularly from the
military, was vital for the industry creation. The government provided the essential
parameters for the rise of semiconductor supply and demand. It posited and prioritized
a technological necessity, funded initial R&D and the first pilot production, assisted
R&D and production engineering, and assured military procurement at lucrative
prices (NRC, 2012; RASIAH, 2010; MORRIS, 1990). Initially, R&D came to serve the
need for radar precision in the Second World War against Germany, funded mainly by
the US Signal Corps, whereas public funding extended beyond to encompass 40%-45%
of the US industry R&D from late 1950s to early 1970s (NRC, 2012; RASIAH, 2010).
Morris (1990) points the assured military market as “perhaps the most crucial
factor in the development of the industry” (p. 73). Guaranteeing demand at lucrative
prices stimulated private firms’ pursuit of IC development and provided the market for
semiconductors that industrial and commercial consumers could not at stages of high
unit costs, while giving enough demand extent for generating productive economies
of scale in the 1960s, necessary to reduce prices and boost industrial/commercial de-
mand (MORRIS, 1990; NRC, 2012). Such advantage was unavailable to firms in other
countries, which also suffered from their governments’ “comparatively little support”
(MORRIS, 1990, p. 73).
However, the US would face challenges from Japan. Successful industrial policies
allied to the unilateral openness of the US market to Japan, extending to the Japanese
the conditions for productive economies of scale, led Japan to the industry’s leadership
in the 1980s. The US share of worldwide semiconductor market declined from 60%,
in the early 1970s, to 51% in 1982, and 35% in 1989. At the same time, Japan’s rose re-
spectively from 15% to 35% and to 51% (JOHNSON, 1991). First felt by the late 1950s,
in the form of consumer electronics’ imports, Japan’s competition prompted US semi-
conductor firms’ response by offshoring assembling to low wage countries in the early
1960s (MORRIS, 1990), especially to Asia, kick-starting the formation of the GVC.
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Counting with long-term bank loans at low interest rates, a protected market and
a well-funded research consortium led by the government, Japanese firms developed
as IDM (NRC, 2012; BINGHAM, 1998). Japan entered and dominated the leading-
edge memory market, in which low technological cumulativeness due to “technologi-
cal discontinuities between generations” and mass production made it more prone to
technological catch-up10
(CHANG et al., 2015, p. 27), whereas the latter feature made
this segment a driver for process technology in the industry (NRC, 2012). Generally
in a same keiretsu, semiconductor firms close ties with semiconductor manufacturing
equipment (SME) suppliers were crucial for building a strong SME industry, which be-
came the world leader. Differently, US semiconductor firms constantly changed sup-
pliers and transferred the costs of demand volatility to the latter (BINGHAM, 1998).
The US semiconductor industry called for government support through the lob-
bying and public relations of the Semiconductor Industry Association (BINGHAM,
1998). Meanwhile “a defense task force warned, in 1987, that a dependence on foreign
suppliers for state-of-the-art chips for weapons was an ‘unacceptable situation’ because
it would undermine the U.S. military strategy of maintaining technological superi-
ority” (NRC, 2012, p. 325). As a result, the US created SEMATECH, a government-
industry R&D consortium, half-funded by DARPA and involving major US firms. By
a legislative rule, excepting “precompetitive” research from anti-trust laws (BING-
HAM, 1998), SEMATECH developed an industry-wide detailed coordinating tech-
nological roadmap for accelerating the adoption of new technologies. Moreover, the
US pushed Japan to open its market through the bilateral first Semiconductor Trade
Agreement (1986-1991), also aimed to ban and monitor Japanese “dumping practices”
(OTA, 1991). US firms were targeted to climb from 9% to 20% of Japan’s domestic
market (JOHNSON, 1991), while the US declared that “dumping practices” continued
in 1987, imposing sanctions that were followed by Japan reducing dynamic random
access memory (DRAM) production and prices increasing (OTA, 1991).
By the early 1990s, the US was able to regain leadership, though not without costs.
Many of its large firms had exited the DRAM market, maintaining just Micron as a top
player, and losing its commercial firms in the critical/highest technological SME, the
photolithography tools, whose persistent improvements enabled IC manufacturers to
decrease chips’ size, while augmenting their performance and functionalities (ATTA
and SLUSARCZUK, 2012).
Nevertheless, the US actively enabled the conditions for the emergence of compet-
itors to Japan. By handling the Japanese government and repressing its semiconductor
10
Contrasting to high cumulativeness and small-batched production in logic favoring Intel dominance
(CHANG et al., 2015).
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industry, a space was created for the ascertaining of South Korean chaebols in memory
chips, with Samsung becoming the segments’ dominant enterprise. To counter Can-
non and Nikon, the US government allowed US firms’ acquisition by and partner-
ship with Dutch ASML, transferring to the latter the most advanced photolithography
technologies and providing access to US national defense laboratories (ATTA and
SLUSARCZUK, 2012). ASML became the segment’s world leading enterprise, while
providing early access to the newest photolithography tools to US firms11
. Current
progresses in photolithography tools by ASML are still contingent on US governmen-
tal labs’ developed technology. Although the US lost its commercial leg, they can still
operate as system integrators insofar as they dictate technological change in such cru-
cial equipment.
Starting in the mid-1960s, Korea and Taiwan became sites for TNC semiconduc-
tor assembling, particularly US’, supported by policies to attract FDI and to increase
exports (OTA, 1991). Whereas during the 1970s industrial policies aimed to foster
an indigenous semiconductor industry in Korea, they more importantly gave rise to
the economically concentrated and dominant chaebols in electronics. The latter would
target entering in the DRAM market in the 1980s, to which scale and vast financial
resources were imperative (KIM, 1996).
To escape DRAM’s intense competition, Taiwanese industrial policy targeted cus-
tomized chips to which design capabilities were essential (OTA, 1991). The main strat-
egy of Taiwan was to establish the public Electronic Research and Service Organiza-
tion (ERSO), which would partner with foreign firms to acquire technology, and help
create private domestic firms which would receive technology from ERSO. The Radio
Corporation of America partnership with ERSO was cornerstone to the creation of the
United Microelectronics Corporation, and the subsequent partnership with Philips to
TSMC.
While SATS had already emerged in Taiwan, allowing TNC to externalize assem-
bling, TSMC, created in 1987, was the first foundry fully commercializing its produc-
tive capacity, without developing/selling their own IC. Such foundries’ consolidation
enabled fabless’ proliferation, which could then enter the industry circumventing the
entry costs of fabs. Moreover, to deal with excess demand and particular lines of inte-
grated circuits, IDM started to outsource to foundries (GAO, 2006).
11
“Manufacturers, however, can make only one or two leading-edge tools per month. The highest profit
margins for IC products come immediately after an advance occurs in lithography technology. Once the
improved lithography tools become more widely available, the ICs they produce become commodity
items with thin margins. […] Tool suppliers use this as leverage to reward their largest and most loyal
customers” (ATTA and SLUSARKZUC, 2012).
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In 2016, among the forecasted top-20 semiconductor firms in sales revenues, the US
held eight enterprises, including world leader Intel; Japan, Europe and Taiwan had three
each (TSMC as 3rd
); Korea had two (Samsung as 2nd
); and Singapore had one; whereas
12 firms were IDM, five fabless and three foundries (ICINSIGHTS, 2016c). While China
held no position, especially for lacking a large IDM, it became the main semiconductor
consumption market, representing 60.6% of the global market12
in 2016 (PWC, 2017a),
and the major semiconductor assembly base, the lowest value-added stage. These facts
emanate from China’s capacity to attract FDI in the unskilled labor-intensive assembling
of both electronics and semiconductors. However, since mid-2000s, China has had do-
mestic firms among the top 10 of each GVC’s segment (fabless, foundries and SATS).
Figure 1 – Market shares of global semiconductor sales of final
devices by headquarter seller (IDM and fabless only)
South Korea
Japan
Taiwan
China
US
EU
2013 2014 2015 2016
51% 50% 48%51%
16% 17% 17% 17%
14% 12% 11% 11%
9% 8% 9% 10%
6% 7% 6% 7%
4% 4% 4% 5%
Sources: Authors’ elaboration based on data extracted from SIA
(2014, 2016, 2017) and ITA (2016).
In 2016, considering only the sales of final semiconductor devices (fabless/IDM)
Chinese headquartered firms held a mere 5% of the world semiconductor market
(SIA, 2017). Although responsive when their leadership was threatened, the US largely
condescended to Japan’s and later Korea’s and Taiwan’s industrial policies – counting
with US market unilateral openness and technological transfer – for their geopolitical
alliance and role as bases for US military containment of Chinese influence on the
region. Since 1989, the US has kept export controls to China. The Wassenaar Arrange-
ment has served the US practice of limiting SME exports to China at least at two gen-
erations behind US state-of-the-art (GAO, 2002; LI, 2016). Taiwan has severely lim-
ited the scope of semiconductor Taiwanese companies’ and citizens’ activities in the
mainland13
, focusing until recently in prohibitions to outward investments, especially
12
Estimates based on Chinese statistics, different form international standards, see PwC (2016).
13
See Chu (2013).
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in design and manufacturing. Nonetheless, due to the mainland’s market importance,
Taiwan increasingly relaxed restrictions; while global competition has made US export
controls circumvented by acquisition from Europe and Japan (MAYS, 2013).
China’s ambition to have a world-class semiconductor industry and the vast funds
and multiple tools being mobilized for it represent an economic and military threat to
the US and the major players. If China acquires a dominant market share, US commer-
cial threats are unlikely to be effective in disarming its industrial policy and repressing
its industry, as China is the largest semiconductor market and the US its largest supplier.
5. CHINESE IC INDUSTRIAL POLICY
China had an auto-sufficient but technologically backward semiconductor industry,
granted strategic status in the Maoist period, with the creation of the Electronic Indus-
try Ministry (RASIAH et al., 2008). The country pursued, until 1980, the autonomous
development of semiconductor technology for military use, developing its first semicon-
ductor in 1956 and its first IC in 1964, with R&D undertook by state labs and IC manu-
facturing by state-owned factories (LI, 2016). When reform and opening took place,
China was far behind the international semiconductor mainstream: “Being backward
and incompatible with the mainstream standard, the indigenously developed technology
was gradually abandoned” (LI, 2016, p. 196). In regards to manufacturing process tech-
nology, China was five generations behind the US state-of-the-art in 1986 (GAO, 2002).
Through the 1980s and 1990s, China tried a series of policies to develop the semi-
conductor industry, including importing entire production lines by state-owned en-
terprises (SOE). As the Chinese consumption market for semiconductors started to
grow beyond its productive capabilities, triggering TNC’s interests, the CCP allowed
their entrance through joint-ventures with SOE (LI, 2016). In 1989, China produced
114 million IC units and consumed 300 to 400 million; in 1995, this gap was of 4.5 bil-
lion units, representing U$ 1.7 billion (SIMON 1992 apud LI, 2016; SIMON,1996 apud
LI, 2016). In this context, China launched Project 909, which included the attempt to
build as an IDM a new indigenous firm Shanghai Hua Hong Group in joint-venture
with Japanese NEC in 1997, a frustrated attempt as the firm failed to become an IDM
and established as a foundry (LI, 2016).
It was only in the 2000s that China would become deeply integrated into the semi-
conductor GVC, in the context of its World Trade Organization accession. Successive
industrial policies have been implemented since 2000, with varying degrees of success
over each GVC segment. Overall, these policies contributed to increase China’s par-
ticipation in the semiconductor industry’s revenues from 2% to 17.8% of the global
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industry from 2000 to 2016 (Figure 2). Such a significant participation in the global in-
dustry, compared to the mere 5% held in 2016 by China-based firms in the world sales
of final devices, on the one hand, reveals the importance of foreign firms in China’s
semiconductor production; one the other hand, it accounts for the contribution of
SATS and foundries for the overall industry revenues.
The inaugural policy landmark was the 2000 State Council Rule 18, which fos-
tered the entrance of foreign-owned semiconductor firms, reduced SOE’ role and pro-
vided tax incentives (ERNST, 2015). The Rule promoted favorable tax treatment to
IC domestic firms, considered as those located in China, encompassing foreign firms
(PWC, 2004), as well as government investment in R&D, education and infrastructure
(CS, 2016).
Chinese low unskilled labor costs acted as a strong magnet to global electronics’
manufacturers and semiconductor AP&T, the latter also attracted by electronics pro-
ducers’ proximity. Both productive migration trends carried uninterruptedly through-
out the 2010s. In 2009, China became the world’s main base for semiconductor AP&T
in factory floor space, ranking first in the 2010s also in facilities, production value and
employees (PWC, 2017, 2017a). All main IDM and SATS have AP&T plants in the
mainland. In 2017, China had three firms among the top 10 SATS worldwide: Jiangsu
Changjiang Electronics Technology (4th
), Tianshui Huatian Microelectronics (7th
) and
Tongfu Microelectronics (8th
) (PWC, 2017a). Therefore, the segment is a mature in-
dustry in China with globally competitive domestic firms in outsourced services.
Figure 2 – The Semiconductor Industry in China (2000/2016)
Semicondutor revenues (U$ bn)
a
As world share
OSD revenues (U$ bn)
IC revenues (U$ bn)
Semi AT&T (% of world
production value)
Semi fab (% world fab capacity)
IC desing revenues (U$ bn)
self-sufficiency ratio
self-sufficiency ratio
as % world fabless
2000 2003 2005 2007 2009
b
2011 2013
5 8.3 16.1 27.4 29.2 51.4 65.8
2% 5% 6% 9% 7.5% 9% 12%
2.8 4 7.5 11 12.9 21.5 25
- - - - - 106% 110%
2.2 4.2 8.6 16.5 16.2 29.9 40.8
19% 17% 19% 22% 19% 24% 27%
- 9% 12.6% 15% 20.3% 30.8% 40.8%
- 6.3% 7.4% 8.7% 9.6% 10.8% 10.9%
0.13 0.54 1.52 2.97 3.95 8.14 13.15
- 2.5% 4% 6% 7% 10% 17%
2015
89.3
16.2%
31.8
101%
57.5
33%
33%
12.7%
21.09
25%
2016
99
17.8%
33.7
101%
65.3
36%
36%
14.2%
24.75
27.4%
Notes: (1) Overscript (a) represents a series break in 2009 and (b) represents series breaks due to revised
industry statistics. (2) Semi stands for semiconductors; OSD, for opto-sensor-discrete; IC, for integrated
circuits; AP&T, for assembly, packaging and test. (3) Semiconductors is the aggregate of the OSD and IC
segments. (4) Self-sufficiency ratio is the ratio of production over consumption in China. (5) All data in-
clude both foreign and domestic firms. (6) IC design revenues for 2016 were obtained from PwC (2017a)
by multiplying the percentage of design revenues in overall industry revenues, while the percentage over
world fabless revenues was obtained dividing PwC data by ICinsights (2017) worldwide fabless revenues.
Source: PwC (2004, 2007, 2008, 2010, 2012, 2015, 2017, 2017a), ICinsights (2017)
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In the early 2000s, the 10th
Five Year Plan prioritized developing a domestic IC
foundry industry: “pure-play foundries SMIC and Grace (now Hua Hong Semicon-
ductor) were both founded in 2000 and XMC was founded in 2006” (ICINSIGHTS,
2016a). Including the opto-sensor-discrete segment, China’s share of world semicon-
ductor fab capacity grew from 1.5% in 2001 to 7.4% in 2005 (PWC, 2016). During
the period, few foreign IDM had fabs in China (PWC, 2006), and IC fabrication was
mainly propelled by governmental efforts in creating domestic foundries.
However, Chinese headquartered firms’ share of the pure-play world foundry
market peaked in 2006-2007 in 13.3% and dropped, stagnating around 8-9% in the
2010s, despite support since the 1990s (ICINSIGHTS, 2016b; CS, 2016). Chinese lead-
ing foundry SMIC has been for the last years consistently two generations behind the
leading-edge (ERNST, 2015). The main challenges to Chinese firms’ rapid entry would
be the high capital requirements and technological gap, acquiring/guaranteeing cus-
tomers to newly created capacity and developing across the IC ecosystem for imple-
menting new process technologies each two years (CS, 2016).
In the early 2000s, the design sector also started to develop, becoming the major
Chinese IC segment in revenues in 2016 (PWC, 2017a). The government stimulated the
emergence of fabless to create demand for homegrown foundries. Even if most of cur-
rent top domestic fabless were created in the 2001-2004 period (ICINSIGHTS, 2016a),
foreign firms then preponderated in China’s design sector, aiming to adapt products to
the growing domestic market (PWC, 2004). China’s fabless sector, particularly home-
grown firms, has bloomed since 200514
. As China became the main semiconductor
consumption market in 2005 (PWC, 2006) and has geared into becoming the largest
PC and smartphone markets (the latter the major demand driver for IC since 2011),
the CCP promoted the development of domestic electronics firms, as Huawei, Lenovo
and ZTE, while pursuing the implementation of domestic standards. Chinese 3G and
4G standards and the licensing policy to SOE telecom providers leveraged China’s large
domestic market to develop domestic IC design firms’ technical capabilities, particu-
larly benefiting Spreadtrum, RDA and Taiwanese Mediatek, while enabling the coun-
try now to “co-shape international mobile telecom standards” (ERNST, 2015, p. 29).
The pursuit of domestic standards was catalyzed in 2006 by the Medium and
Long-Term Plan for Science and Technology Development (2006-2020), in whose
core lies the concept of indigenous innovation and self-reliance rhetoric, aiming to
reduce technological dependency, especially on the US and Japan, seen as security
threats (ERNST, 2011). Indigenous innovation, however, does not equal to domestic
14
Growing from 2.5% to 27.7% of the world fabless market between 2003 and 2016 (Figure 2). This growth
also started to attract foreign foundries eager to tap the market, breaking a certain reluctance of IC manu-
facturers (and governments) to construct advanced fabs offshore.
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R&D, having an important role for technology import, as expressed in Chinese tele-
com standards, carrying huge chunks of foreign intellectual property. According to
Ernst (2011), indigenous innovation encompasses original innovation (patent lead-
ing, or just innovation), “integrated innovation” (similar to technology diversifica-
tion), and “re-innovation” (similar to incremental innovation), which “building on
imported technologies, ‘incremental innovation’ seeks to exploit as much as possible
the potential of a given “design”, by introducing relatively minor changes to an exist-
ing product or process” (p. 25). Regarding semiconductors, the Ministry of Industry
and Information Technology asserted in 2006 targets for self-sufficiency ratios in IC –
higher for those in information and national defense security than in communications
and digital household appliances –, as well as to “basically achieve self-sufficiency in
the supply of key products” (MIIT apud Ernst, 2011, p. 24).
Despite these policies, ensued by the 2011 State Council Rule 4 substituting 2000’s
Rule 18, the Chinese consumption-production gap skyrocketed (Graph 1). China’s
semiconductor consumption grew from 18.5% of the world market, in 2003, to 56.6%
in 2014 (PWC, 2017). The consumption-production gap rose from U$20.8 billion in
2003 to U$120.1 billion in 201415
(PWC, 2016). Despite this large gap, an expanding
demand is fundamental for entering other GVC segments beyond assembling. A re-
stricted domestic market was an important factor to Malaysia’s failure in significantly
developing manufacturing and R&D, when the country was the main world base for
semiconductor assembling, before China overtaking it.
Foreign firms captured most of the growth of China’s semiconductor consump-
tion market. In 2014, all top 10 suppliers of China’s market were foreign, namely, Intel,
Samsung, SK Hynix, Qualcomm, Toshiba, Texas Instruments, STMicroelectronics,
AMD, Freescale and Renesas (PWC, 2016). In this context, Snowden’s 2013 revelation
of PRISM, involving Intel and Qualcomm, might have catalyzed the promulgation of
the 2014 Guidelines for the Promotion of the Development of the National IC Indus-
try (hereafter, the Guidelines).
The 2014 Guidelines have set ambitious targets for China’s IC industry develop-
ment, aiming not to move-up/upgrading in the GVC – which implies the concomitant
entry/exit in higher/lower value-added productive stages –, but to promote import sub-
stitution, strengthening all stages. The central issue for China’s technological progress
and value appropriation is not merely GVC product “upgrading”. The mainland already
has significant insertion in all semiconductor GVC segments (Figure 2), largely mani-
festing that “vertical integration between multinational corporations has created an in-
dustry ecosystem, and Chinese domestic companies can only passively follow behind”,
whereas “high-level chips are mostly manufactured outside of China” (WEI, 2014, p. 4).
15
Even if the “self-sufficiency” ratio grew from 17% in 2003 to 29% in 2014 (PwC, 2016).
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Graph 1 – The Chinese IC gap (in U$ billion)
200
6,6
11,4 13,8 17,7
25
35
46,4
59,5
73,9
85,9 83,1
108,6
124,8
135,6
149
169,2 175,5
5,6 9,2 11,5 14,5 20,8 28,4
37,8
46,9
57,4
68 66,9
87,3
94,9
101,3
108,2
120,1 118
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
180
160
140
120
100
80
60
40
20
0
Consumption Production Consumption-production gap
Source: Adapted from PwC (2017a).
To reach the technological frontier and to vie for the control over the direction and
pace of technological progress – translated into higher than average profits and, there-
fore, larger shares of value appropriation in the CGV –, China seeks to domestically
integrate (i) all IC industrial stages along with (ii) the downstream and the upstream
high-tech sectors of the modern industrial system. In promoting the latter, the Guide-
lines have put greater emphasis at downstream, due to the sector’s advanced stage of
development compared to the incipient development upstream. One of the Guidelines’
basic principles is to “build an industrial chain consisting of ‘integrated circuit chips,
software, whole units, systems, and information services” (STATE COUNCIL, 2014,
p. 2).
China has identified the problem with IC insufficient production (production-
consumption gap) “as the critical roadblock to catching up and forging ahead across
a broad range of China’s leading industries” (ERNST, 2016, p. 9). Insufficient pro-
duction and technology are inextricably intertwined, in as much as the mastery of a
technology and innovation depend on the essential process of learning in production,
particularly in manufacturing sectors in which “manufacturability of new products
is the most critical step in the innovation chain” (CHANG and ANDREONI, 2016,
p. 20). Therefore, the Guidelines set targets for industry revenues and technology in
all industry segments, equipment and material. In 2020, China plans to achieve 2014’s
state-of-the-art manufacturing process technology in mass production (16nm/14nm),
international leading-edge in AP&T and in key design areas (smartphones/network
communication/cloud computing/IoT/big data) and to produce key equipment and
materials (STATE COUNCIL, 2014), whereas MIC 2025 set self-sufficiency ratios for
2020 in 40% and 70% for 2025.
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The ultimate goal is to achieve advanced international level in the IC industry’s
main stages by 2030, with few enterprises in the top global firms (STATE COUNCIL,
2014). The goals, however, are much less ambitious in equipment and materials, the
upstream sector, which is China’s most backward segment, the hardest to enter and yet
the most fundamental for controlling technological progress’ pace. In SME, just the
US, Japan and Europe are important global players. In Tianchun’s (2014) view “China
does not have to be competitive in all critical areas of equipment and materials – but
we must develop a few key products in order to give our industry the confidence to
engage in global technological cooperation and dialogue” (p. 3). Notwithstanding, he
recognizes that without the upstream sector China will be “unable to grasp the in-
dustry’s decision-making power” (p. 3), providing intelligibility to the export controls
these goods are still submitted to.
The Guidelines have already qualitatively improved Chinese smartphone suppli-
ers’ global competitive position by raising homegrown IC design capabilities (CHINA
DAILY, 2017). According to Ernst (2016), an adjustment was implemented to China’s
semiconductor industrial policy by the MIC 2025 and supporting policy documents,
with a view to diversify China’s semiconductor products aiming to fulfill the targets as
the demand-pull from smartphones decelerates, including a push to enter in memory
and industrial-end market semiconductors. China achieved its 2015 revenue target
and is likely to fulfill the 40% self-sufficiency ratio by 2020, for in 2016 the ratio was
36%, up from 17% in 2001 (PWC, 2017). Moreover, the production-consumption gap
shrunk absolutely in 2015-2016, which had only happened in 2009 since China’s GVC
integration (PWC, 2017a). Whereas technology targets are contingent to Chinese
firms, industry’s revenues and self-sufficiency ratios benefit from foreign firms’ opera-
tions. The latter play a key role in China’s strategy, providing technological transfers
and reducing its imports.
To those ends, China has created large public and private investment funds – the
latter with significant government influence –, expected to reach U$150 billion over
the next decade (PCAST, 2017). In 2014-2015, the central and local governments
set the National IC Fund and several regional funds, respectively. These resources
have been employed to integrate the IC chain – as Tsinghua Unigroup fund’s acqui-
sitions aiming to build an IDM ecosystem – and to pursue domestic consolidation
and investment in domestic leaders, with a view to increase firms’ capacity to engage
in large R&D expenditures, upgrade facilities and contour fabrication’s high capital
requirements and longer investment maturation (CS, 2016; EUCCC, 2017). Consoli-
dation also seeks to augment China’s market power vis-à-vis international suppliers
in the GVC.
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Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
Furthermore, the funds served an aggressive pursuit for foreign acquisitions16
,
seeking to obtain critical technology. Such road has been quickly blocked in the US
– by the Commission on Foreign Investment in the US –, South Korea, Taiwan and
growingly in the EU17
and Japan, the latter under substantial US pressure. However,
the blockage cannot impede technology import. Ernst (2016) highlights that at least
Tsinghua developed sophisticated strategies to acquire critical technology, while sev-
eral leading global firms would be betting on Chinese policies’ success: “in fact, U.S.
and other foreign firms are quite explicit that they might accede to Chinese demands
to transfer technology and form joint ventures with its firms, if only they could expand
or at least sustain their share of the China market” (p. 18-19).
In mediating the access of foreign firms to China’s market, the government has
been using a series of tools – such as procurement, security legislations, anti-monop-
oly law and propaganda – to acquire technology, disclose information, localize foreign
firms, reduce royalty payments and substitute domestic for foreign technology where
domestic capabilities exist. The use of these tools imbricates national security and eco-
nomic reasons. After PRISM revelation, the Chinese government has drafted/passed,
in 2015/2016, the National Security Law, the new banking and insurance regulations,
the Cybersecurity Law and the Antiterrorist Law, emphasizing the use of “secure and
controllable” technologies. By privileging and subsidizing domestic products and
technologies, these legislations/drafts have put under discussion the need for foreign
firms to locally store data, disclose software source-codes to the government, as well
as encryption keys in case of investigations and implement software and hardware
backdoors for governmental access, particularly in the banking and insurance sector
(MOZUR, 2015; DOU, 2016).
US tech giants have been put under legal and ideological pressure. Qualcomm was
fined in U$ 975 million in 2015 in the Chinese anti-monopoly law for higher than
average royalty rates and for forcing combined licensing (MCCORMICK, 2015). As a
result, the company paid the due, reduced royalties and later entered in a joint-venture
with a Chinese firm. In 2013, Cisco, IBM, Google, Qualcomm, Intel, Apple, Microsoft
and Oracle were named US’ eight “guardian warriors”, by the China Economic Week-
ly’s cover, which had discreetly infiltrated in the country (ROSEN and BAO, 2013). It
rapidly spread across the Chinese media with claims to the public for acquiring do-
16
Prior to 2013, China had made six investments in US semiconductor firms, totaling U$214 million; from
2013 to late 2016, the rumored, attempted and successful investments were 27, totaling U$37 billion
(RHODIUM GROUP apud EUCCC, 2017).
17
The European Union Commercial Chamber in China (2017) concerns with Chinese acquisitions points
to the Silex Microelectronics’ case, a Sweden semiconductor company that ultimately felt in the hands of
Beijing Navgness Integration, which subsequently entered in joint venture with the PLA.
24. 24
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Rev. Econ. Contemp., v. 22, n. 1, p. 1-28, jan./abr. 2018: e182216 DOI: 10.1590/198055272216
mestic products and technologies. Notwithstanding, there is a limit to these pressures
as China still lags significantly behind in IC production and technology, depending on
strategic partnerships with foreign firms to reduce its import dependency and absorb
technology as well as to modernize its military and its capacity to face asymmetrical
warfare.
Furthermore, Chinese technological achievements in the commercial sector are
explicitly pursued in the attempt to raise military capabilities, concerning especially
the US and Taiwan. China’s IC industrial policies alarmed and prompted countering
measures from major players. Without dispensing opposing Chinese “damaging” in-
dustrial policies, the US understand that maintaining its semiconductor leadership
cannot be sustained on that, and has called for pursuing “moon shots”, or ambitious
challenges coordinating the innovation system (PCAST, 2017).
6. CONCLUSION
Despite neoliberal policies and rhetoric being impinged upon the world by the US
and the EU over the last decades, industrial policy never was in question in strategic
sectors. Significant technological semiconductor advancements are a crucial dimen-
sion of economic and military power. China has advanced several important steps in
semiconductor production and in decreasing its dependency. Nonetheless, China is
still distant from meeting its consumption needs and the technological frontier in de-
sign and manufacturing. Despite circumventing US export controls in SME, imports
of state-of-the-art fab machinery were not made by Chinese headquartered firms (still
two generations behind the leading-edge). Rather, they were made to establish facili-
ties for companies as Intel and Samsung. In crucial SME, China is still much behind
Japan, the US and Europe. This becomes more critical as Chinese headquartered semi-
conductor manufacturing firms push to reach leading-edge, given the security aspects
referred before and the blockages derived from those goods subordinated to power
strategies (strategic trade). However, China has its domestic market as bargaining
power, the fact of being the major IC consumer and, consequently, the largest market
for the production of semiconductors and their equipment. The ongoing strategy aims
to take advantage of this technological opportunity, and it has already prompted stra-
tegic reactions from major players.
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