2. Industrial policy - a comparative international review A number of major world countries and economies, similarly like Singapore, are currently renewing their economic and industrial policy frameworks and strategies. This is driven by a new phase of global economic environment already at a distance from 2007-2009 financial crisis and the rising expectations of new technologies, in particular the new wave of automation and robotisation. They often are related to two similar, but not identical concepts: -
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the narrower concept of “Industry 4.0” (originating from Germany), mostly linked to changes in manufacturing as regards the expected further digitisation and robotisation as well as the possible re-localisation of manufacturing due to emergence of additive manufacturing (i.e. 3D printing) technologies. This concept has a more positive connotation (from the perspective of developed economies) of increasing employment due to the “re-shoring” of industrial production back to developed economies; the broader concept of the expected-to-be Fourth industrial revolution (most prominently known from the World Economic Forum), putting more emphasis on technological advances (in particular as regards artificial intelligence) enabling a broader application of automation technologies, including for services sector. This concept has a more negative connotation of automation of a very broad range of tasks (physical, cognitive or social) potentially leading to wide-spread job destruction.
However policy reflection to intervene as regards these new technologies (both for optimistic – i.e. growth enhancing and pessimistic – i.e. job destructing expectations) is not a replication of earlier thinking with regard to industrial policy. Quite the opposite, this new wave of thinking and policy action is termed as a new generation of industrial policy, moving beyond generic/horizontal/direct interventions in product or factor markets (subsidies, taxes, direct ownership) towards more complex composite policies, “that help build systems, create networks, develop institutions and align strategic priorities” (Warwick, K., 2013). This changing direction of industrial policy emphasises more the importance of intangible factors in pursuit of technological catch-up and economic development, be it promoting research and development activities; developing company networks and clusters; facilitating human capital formation or enhancing access to international trade, including through accessing complex valueadded chains in global production networks and upgrading the position companies and industries occupy in them (Warwick, K. and Nolan, A., 2014). The following sections will provide a concise overview of the latest industrial policy initiatives across major global economies, the growing importance of intangible capital and value chains perspective in generating productivity growth and fostering economic development, a summary of key analytical frameworks available in the literature (particularly as developed by international organisations) to deconstruct, classify and compare industrial, skills and workforce development policies, an overview of debates on industrial policy evaluation and then finally analysing the situation in Singapore from all those perspectives.
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