Innovation and Structural Transformation



Proposals should be submitted to the GReCEST Secretariat ( by the end of March 2017


Name of Working Group

Innovation and structural transformation

Thematic Leader

Keun lee, Center for Economic Catch-up, Korea

Group Members

Chan Wong in Univ. of Malaysia, and others.


Can the 4th Industrial Revolution open up a New Window of Opportunity

or reinforce the middle-income trap

Targeted Country/Region

MICs in Asia and  Latin America (and possible Africa)


Journal special issue; conferences and workshops, and some reports/books

Related Projects/Entities

[if applicable] Related group: GVC and Industrial Policy



Explain briefly what the working group plans to do to advance the shared objective of theGReCEST, that is, bridging the gap between research and practice to promote economic structural transformation (including scope and objective), any background information, and how the proposed activities will be implemented.


An emerging question and challenge today, with the arrival of the 4th Industrial Revolution (Schwab 2016)., is whether the next generation of less-developed economies can also use export-based manufacturing as a path to prosperity. The 4IR (4th Industrial revolution) refers to the new waves of innovations consisting of several technologies comprising 3D-printing, IoT, AI, VR, Smart car, big data, on-demand economy (sharing economy), and renewable energies.  Specifically, this very Asian development model also faces many challenges with the arrival of the 4IR, as follows; The Fourth Industrial Revolution is re-writing the rules of manufacturing. As the cost of automation plummets, low-cost labour is a less effective strategy to attract manufacturing investmen; As the 4IR takes hold, we see possibly the beginning of a trend towards re-shoring of manufacturing back to the rich world (eg Apple in the US and Adidas making shoes in Germany); Some observers expect global supply chains to become more regional and even national in order to reduce delivery times and to make manufacturing more responsive to local tastes and local demand conditions. This potentially reduces the economies of scale that can be achieved when producing for the whole world


This proposed project is to investigatethe possible impacts of the 4th IR (industrial revolution) on the upgrading and structural transformation of the middle income economies in Asia and Latin America (and possibly Africa). It will analyse the 4th Industrial Revolution (hereafter 4IR)-related big trends impacting manufacturing and the related services in the local context, and assess the current and future competitiveness of economies in view of these trends. It will suggest ideas and policies for how the region can position itself for the future (possibly a framework for analysis or a policy toolkit).


Describe brieflythe components of the proposed activities, the expected outputs of each component, and the indicators that are likely to be used to measure these outputs.

The research outcomes will evolve and be used in a series of dialogue and/or a set of workshops with the governments and firms in the region, using the on-going study to kick start important conversations about how to respond to these ideas. It would have broad relevance to all less-developed economies, and specific relevance to these Regions

3.  Timeline

State briefly the timeline of the proposed activities.

A seed project is going on already, with focus on ASEAN economies.

Can be expandable with more funding to cover more economies around the world, including Africa or Latin America.


4. Related Projects

Explain brieflyany possible linkage between the proposed activities and other projects.

Can work together withthe GVC and industrial policy group of the GReCest.



State briefly which institutions or experts (outside the GReCEST) are likely to be involved in the proposedactivities.

A Collaboration is going on with the World Economic Forum.  An initial seed funding is obtained from the Seoul National University.  A preliminary finding will be reported in the ASEAN regional meeting of the World Economic Forum in early May 2017.