Two-way linkages between innovation and human development: a study on southern-china clusters

Barbieri, Elisa (1,4); Pollio, Chiara (2,4); Rubini, Lauretta (3,4) (2019). 'Two-way linkages between innovation and human development: a study on Southern-China Clusters' Paper presented at the annual conference of the HDCA 2019, London, UK.

Abstract

Traditionally and in recent times, the international debate has identified industrial development as one of the drivers of economic growth and poverty alleviation (Haraguchi, 2017). Industrialization processes have also entered the international debate about sustainability, given their potential not only to foster growth, but also to promote innovation and decent jobs (European Commission, 2010). With these starting premises, Inclusive and Sustainable Development (ISID), intended as a process of industrialization providing fair involvement and rewards to large strata of global population (UNIDO, 2015), has been promoted as a leading strategy within the UN agencies, connecting social, environmental and economic aspects of development to achieve the Sustainable Development Goals (SDGs).

One of the most important mechanisms triggered by industrialization to achieve inclusive development rests in technology and innovation (also acknowledged in SDG 9). Even the economic success of a country relates to the extent to which structural changes, introducing larger shares of modern production in the economic context, are coupled with technological catch-up and the country’s ability to produce innovation (Lavopa and Szirmai, 2018). In this framework, new technologies and ICT are considered key tools to connect people and territories and empower large strata of the population (United Nations, 2018). Increased connectivity among people and among economic agents is proved to be correlated with gains in productivity and efficiency for economic and social systems (Siegel, 1983; Disney et al., 2004; Ollo-López and Aramendía-Muneta, 2012, only to cite some). It is also positively associated with social inclusion, by improving people’s access to goods and – both private and public – services, giving new answers to old needs and potentially enhancing human capabilities (Capriati, 2017; Osei-Frimpong et al., 2016; Gigler, 2011; Lyons, 2009; Balauskat et al., 2012). New communication technologies have become one of the most powerful tools for capability expansions and human flourishing, allowing for new forms of social, political and economic organization (Linders, 2012; Lechman & Marszk, 2015). They even show to be positively correlated with environmental sustainability (Gouvea et al., 2017). In other words, the benefits of ICT in the perspective of end-users, being them either people, companies or governments, have been extensively documented (Asongu & Le Roux, 2017; Kozma, 2005; Molony, 2009) and are recognized as essential tools for the Agenda 2030 for sustainable development (United Nations, 2018; Sachs, 2012).

However, while on the side of consumption the risks and the benefits associated with ICT are acknowledged, ICT is also a product: it is produced in specific places around the world, it represents a distinct manufacturing sector, and its production can come at some costs, both for the end users and for those directly engaged in the production processes (NLC, 2009; Hughes et al., 2017).

This said, our study focuses on ICT on the side of production. We analyze the experience of Dongguan city, in the Guangdong Province of China (Sub-national HDI equal to 0.784 in 2017 according to Global Data Lab). This relatively small prefecture[1] in Southern China[2] - has witnessed in few years an impressive growth in ICT production, becoming a world hub in this field (Wang and Lin, 2008; Zhou, 2013; Zhou et al., 2011). In 2016, one sixth of all the smartphone sold in the world was manufactured in this city[3]. The organization of ICT production, and in general of the whole manufacturing, in Dongguan is structured around industrial clusters. Dongguan’s industrial cluster have mainly developed under the influx of exogenous forces. Since the beginning, the main source of capital was FDI coming from neighbor areas that were interested in transforming the region in an export hub. The following industrial growth has attracted abundant inflows of migrant populations from rural areas (Yang, 2007; Yang and Liao, 2010; Shen and Tsai, 2016). Additionally, since 2000 they have gradually entered a provincial specialization and upgrading program – called the Specialized Towns program – aiming at fostering production and specialization upgrading of the clusters.

With this paper, we aim at analyzing the two-way relation between technological innovation and human development within the context of globally-relevant production clusters. Our aim is, then, twofold: on the one hand, we wish to investigate what distinctive social, economic and institutional features can enable ICT specialized cluster to promote human development. On the other hand, we want to investigate whether, in the context of a developing country, better performances in terms of human development and capabilities can enhance technological innovation and economic performance. We do so with a mixed-method approach: on the one hand, we build on qualitative information on Dongguan specialized towns, gathered through a number of fieldworks and interviews with top managers, policy-makers and relevant stakeholders in both provincial and local institutions. On the other, we use an original township-level dataset (2001-2015) including data on economic and industrial performances as well as social and demographic indicators. We study the interactions between innovation, industrial performances and human development by using a tailored version of the HDI (in line with the UNDP methodology), based on the available information at township level.

Therefore, with this study we aim at addressing the gap in the literature on analyzing human development in productive contexts, by focusing specifically on the linkages between innovation and human development within the context of industrial production of ICT, addressing particularly the mechanisms through which human development can foster innovation – which have been neglected so far.

Keywords: Human development; sustainable industrialization; China; Innovation; ICT.


[1] Prefectures represent the second administrative level (below the Provinces) of China (Di Tommaso et al., 2013).

[2] In 2015 (last available data) Dongguan's permanent population summed up to 8,254 million, while its land covers 2.460 square kilometres. Source: Guangdong Bureau of Statistics (2016).

[3] https://news.cgtn.com/news/3d557a4d32454464776c6d636a4e6e62684a4856/share_p.html

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