For citation:
Dementiev, V. E. (2022). Technological Development and Structural Changes in National Economies. AlterEconomics, 19(1), 116-130. https://doi.org/10.31063/AlterEconomics/2022.19-1.7.
Abstract:
In the context of the industrial revolution, national governments’ ability to develop effective structural policies is becoming particularly relevant. The purpose of the article is to analyze the theoretical underpinnings of such policies. The main focus is made on the provisions of the «new structural economy» and the theory of long waves or Kondratiev cycles associated with the changing patterns of technological development. The study shows that an effective structural policy should take into account the increasing role of intellectual assets in the development of modern and traditional sectors of economy. Measures proposed within the framework of the «new structural economics» for catching-up economies are discussed in relation to five groups of industries. In the light of the risks that developing countries have to deal with in their pursuit of operational efficiency, the recommendation to move to the beginning or end of the value chain should not be perceived as a one-size-fits-all solution. Another question to be considered is the evolution of the sectoral structure of economy during the transition from one technological mode to another. National policy-makers should give due regard to the prospect that some industries belonging to the preceding technological mode will be included into the structure of the key industries in the new mode. Our analysis has also demonstrated an undulating change in the proportion of investments in intellectual assets within the general structure of investments in private fixed assets in some industries. It is argued that the growing tolerance of economic policy towards unprofitable firms, observed in crisis conditions, increases the inertia of economic development. As these firms manage to survive through the crisis, the growth of more productive companies is hindered and the overall dynamics of returns from factors of production suffers. Therefore, a structural policy should address not only intersectoral, but also intra-sectoral shifts in the use of resources, which may be a subject for further research.
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