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Vertical Industry Development to Leverage Innovation: A Model for Leapfrogging Technology and Driving Competitiveness

Publication | June 2020
Vertical Industry Development to Leverage Innovation: A Model for Leapfrogging Technology and Driving Competitiveness

This paper proposes a development model that can help create, shape, and promote more innovative vertical industries. It explores success criteria and highlights lessons learned from four vertical industry development cases.

Innovation is key for developing countries to overcome the middle income trap. Yet, traditional mechanisms to develop national innovation systems, such as structural reforms and investments in research and development, can be insufficient and take a long time. Countries are looking for new approaches to leapfrog, increase competitiveness, and diversify the economy. The four cases presented in this paper provide an understanding of how a vertical industry development model using innovation challenges can be applied as an alternative.

Contents 

  • Introduction
  • Indonesia: Needs and Challenges of a Middle-Income Country
  • Innovation for Growth and Global Competitiveness
  • Case on Vertical Industry Development
  • Vertical Industry Development: A Five-Step Model
  • Alternative Paths to Vertical Industry Development
  • Appendix