What drives the capacity to integrate Industry 4.0 technologies? Evidence from European R&D projects

ABSTRACT

Industry 4.0 is a word that identifies innovative technologies, processes and products, typical of a Fourth Industrial Revolution characterised by a massive and pervasive use of interdependent digital technologies and the rise of cyber-physical spaces or smart factories. European Member States are committed to adapting their innovation systems in order to be able to benefit from Industry 4.0 and the European Commission is also facing the challenge of putting less advanced regions in a position to do so. However, little is known about the drivers of the capacity to compete in the domain of Industry 4.0 by integrating different enabling technologies at the regional level. On the basis of data on regional participation in the 7th European Framework Programme for research and technological development, we investigate the factors underlying the capacity to compete by integrating Industry 4.0 enabling technologies. The evidence shows that EU funding, centrality in research networks and interregional cooperation all play a significant role in technology integration, and these results have important policy implications.

KEYWORDS:

• Industry 4.0
• technological integration
• Smart specialisation
• European NUTS 2 regions
• Framework Programme

JEL Codes:

• O18
• O31
• O38
• R58

Acknowledgements

This work benefited from valuable input from Antonio Lopolito, Luca Rossi, Marco Pompili and the anonymous referees.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Alessandro Muscio http://orcid.org/0000-0001-5186-2522

Andrea Ciffolilli http://orcid.org/0000-0001-6738-4967

Notes

1 WEF (2016) The future of jobs. Employment, skills and workforce strategy for the Fourth Industrial Revolution. World Economic Forum: http://www3.weforum.org/docs/WEF_Future_of_Jobs.pdf. Accessed 26 May 2016

2 The nine enabling technologies identified in the Italian plan are: Advanced Manufacturing Solutions; Additive Manufacturing; Augmented Reality; Simulation; Horizontal/Vertical Integration; Industrial Internet; Cloud; Cyber-security; Big Data and Analytics.

3 NUTS, Nomenclature of Territorial Units for Statistics (or in French ‘Nomenclature des unités territoriales statistiques’) is a geocode standard developed and regulated by the European Union.

4 The HHID is zero when complete specialisation is reached and regions carry out projects only in one single area and is close to one with complete diversification when regions carry out projects in all available areas.

5 The SDI increases as specialisation decreases, reaching zero with absolute specialisation and with the upper bound meaning complete diversification.

6 Durbin-Wu-Hausman chi-sq test: 4.700 - Chi-sq(1) - P-value = 0.030, where H0: Regressor is exogenous.