This discussion paper examines the implications of innovative digital technologies on competitiveness, employment, equality, the international division of labor, and resource efficiency, focusing on digital production technologies in the manufacturing sector over a 10- to 15-year horizon. Key research questions include the impact of the digital revolution on industrialization and the relative positions of developed and developing countries in global competition, as well as the implications for industrial policy. The paper situates the discourse on digitalization within the evolving nature of industrialization, addressing issues like premature deindustrialization and the role of manufacturing in latecomer development. It highlights the increasing intersection between manufacturing and services, known as the servicification of manufacturing, driven by embedded services and new service-based business models. A detailed case study of Germany's "Industrie 4.0" strategy is included, along with a comparative analysis of similar initiatives in other countries and EU-level coordination efforts. The paper concludes with insights on the role of industrial policy in guiding the digital revolution toward socially beneficial outcomes, emphasizing the importance of technology foresight exercises. It also discusses the challenges faced by developing countries in the context of latecomer industrialization amidst the digital revolution.
