5 Economic growth and structural transformation

Rearrangement of the weights of large sectors within GDP is a well-documented phenomenon in the evolution of the economy. The weight of the agricultural sector has typically declined, the proportion of industry appeared as an inverted U-shaped curve, and the services sector showed steady growth. In the case of agriculture, both demand and supply effects contributed to the decline in the weight of this sector. Rapid expansion in productivity was observed in the sector, and the income elasticity of agricultural products (i.e. the proportion spent on agricultural products from one unit of additional income) was also low. Considering the weight of industry, the fall in prices caused by the expansion in productivity initially entailed an increase in sales revenue and thus a rise in the weight of the sector. However, as demand reacted less and less to the decline in prices, the economic weight of the sector started to decrease, and even the high income elasticity of industrial products could not offset this. In the case of services, productivity expansion was also relatively subdued, while the income elasticity of demand is also high, i.e. the weight of this sector increased. Looking ahead, we can formulate two important messages. Firstly, sectors in which prices are very high at the moment but decline quickly have great potential (e.g. electric vehicles). Secondly, the demand for goods which does not grow proportionately to the increase in income will represent a declining weight in production and employment. It is primarily the widespread penetration of the general purpose technology (GPT) typical of the given era that is responsible for the expansion in productivity. The appearance of GPTs is accompanied by two phenomena: Firstly, upon the introduction of a new technology, the expansion in productivity is typically slower. Secondly, with new combinations coming into existence, previous solutions and skills are crowded out and become redundant, and a process that destroys the previous structures, that is creative destruction, occurs in the innovation developments of market economies. Undoubtedly, the GPT of the current period is information and communication technology. The most important technologies of the near future are fundamentally related to electromobility, the storage of electric energy, means of communication and environmental protection. In addition, significant potential can be identified in the automation of working processes that represent higher knowledge in the case of the Internet of things, cloud computing, robotics and self-driving cars as well. According to certain analyses, wide application of artificial intelligence will change the economy and our everyday life to an extent that already means a new technological era. The European Commission designated six Key Enabling Technologies, the support of which will allow Europe to become one of the global leaders in innovation and to preserve this position. These six technologies are: advanced materials, nanotechnology, micro and nanoelectronics, industrial biotechnology, photonics and advanced manufacturing technologies. Common features of the key technologies are their high R&D intensity, they operate with rapid innovation cycles, they are capital intensive and require highly qualified labour. Hungary specialises in the production and export of technologies, but even compared to the V3 region it lags behind in patenting a number of key technologies. According to Grinin et al. (2017), the next 30–50 years will mostly be characterised by the economic cycle determined by the MANBRIC (medical, additive, nano-, bio-, robotics, IT and cognitive) technologies, and this field may become the general purpose technology of the global economy. The projection was formulated on the basis of the dynamics of patent statistics observed in past decades and the expected innovation requirement of medical technology improvements necessary for the health care of the ageing society. The main fields of innovation of the future were primarily corroborated by data for Far Eastern countries, where, in their opinion, the next technological change will start from