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Could China Be the Winner of the Next Industrial Revolution?

Author

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  • Lilla Sarolta Balogh

    (Magyar Nemzeti Bank)

Abstract

This paper attempts to give a comprehensive picture of China’s current position and prospects for growth in the next industrial revolution, assessing whether the country can emerge as one of the “global winners” of the coming transformation. We provide an overview based on a review of the literature on the main driving megatrends of the so-called Fourth Industrial Revolution and present the most important socioeconomic implications affecting China. We progress by analysing China’s current economic situation and growth prospects, reviewing secondary data. We find that to ensure a positive grow path, there is a need to enhance productivity via innovation, and we thus evaluate the innovative capacities of Chinese industry. We conclude that China is already a world leader in various industries based on consumer-focused, efficiency-driven innovation, and while Chinese players have not attained global competitiveness yet in engineering and science-based industries, if the country can follow its current path of development in promoting R&D, with no major systemic disturbances, it is only a matter of time before Chinese players will also emerge as world leaders in high-tech sectors.

Suggested Citation

  • Lilla Sarolta Balogh, 2017. "Could China Be the Winner of the Next Industrial Revolution?," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 16(Sepcial I), pages 73-100.
    • Handle: RePEc:mnb:finrev:v:16:y:2017:i:specialissue:p:73-100
    as

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    References listed on IDEAS

    as
    1. Uppenberg, Kristian, 2009. "Innovation and economic growth," EIB Papers 1/2009, European Investment Bank, Economics Department.
    2. Lee, Sang M. & Peterson, Suzanne J., 2000. "Culture, entrepreneurial orientation, and global competitiveness," Journal of World Business, Elsevier, vol. 35(4), pages 401-416, January.
    3. Altenburg, Tilman & Schmitz, Hubert & Stamm, Andreas, 2008. "Breakthrough China's and India's Transition from Production to Innovation," World Development, Elsevier, vol. 36(2), pages 325-344, February.
    4. Chenggang Xu, 2011. "The Fundamental Institutions of China's Reforms and Development," Journal of Economic Literature, American Economic Association, vol. 49(4), pages 1076-1151, December.
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    More about this item

    Keywords

    sustainable growth; education and research; fourth industrial revolution; innovation; China;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O00 - Economic Development, Innovation, Technological Change, and Growth - - General - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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