Industry 4.0 in China : the interplay of innovation, employment, and housing dynamics

Abstract

The transition to Industry 4.0, marked by the integration of automation technologies into the fabric of industrial and socio-economic systems in China, is the research theme of this thesis. This study explores the complexities and implications of this transition, with a specific emphasis on the role of automation technologies. The research is motivated by the need to understand the evolution from Industry 3.0 to 4.0 and its implications. In addition to examining the factors influencing the adoption of these technologies, the paper also examines their broader socio-economic impacts, such as on employment dynamics and housing market conditions. The thesis is structured around four overall research questions. The first research investigates whether the transition to Industry 4.0 in China represents a path-dependent evolution or a radical shift, focusing on factors influencing technology diffusion across Chinese cities. The second research question explores whether technologically lagging countries can leverage imported products for Industry 4.0-related innovations. The third research question examines how diversity and specialization in industries affect a city’s capacity to integrate automation technologies. The fourth question studies the relationship between automation and housing prices, revealing the underlying economic dynamics. Employing a quantitative research methodology rooted in econometrics, the study analyses data from multiple sources, including the China Industrial Enterprise Database, China Customs Database, China Patent Application Database, the International Federation of Robotics, and the China Statistical Yearbook. In China, Industry 4.0 adoption is primarily influenced by technological and geographical proximity. Furthermore, the research indicates that imports can catalyse innovation at the level of city-industry. A variety of factors interact with robotic adoption in ways that affect employment differently, including industrial diversity and specialisation. Furthermore, robotics adoption is associated with an increase in local housing prices, with spillover effects on neighbouring cities. In summary, this thesis contributes significant insights into the dynamics of Industry 4.0 adoption, as well as its economic and social implications. For policymakers, urban planners, and industry stakeholders, these findings offer valuable perspectives, guiding strategies for technological adaptation and managing Industry 4.0 challenges.