Structural Change – ADB – ADBI Innovation and Structural Transformation Database

Structural Change: Introduction

Structural changeA change in the composition of either employment or output (value added) of an economy. This is usually measured as a change in the shares of several sectors in employment or value added, e.g., the share of agriculture or the share of manufacturing.
identifies the movement of resources (capital and labor) towards new activities and the production of new goods and services.
Development requires a deep structural change of the economy, which implies both changes in lifestyle, and changes in the productive system.
This leads to changes in the shares of sectors in the economy in terms of employment, production and demand.

Structural change is measured through changes in the shares of sectors in the economy.
International trade (exports and imports) contributes to structural change, as it exposes the economy to international competition.
The database provides indicators for structural change in production and demand, and the role of
global value chainsThe production of a single commodity or service can be split into many small parts (this is referred to as fragmentation). When these small parts are performed by separate production locations and/or firms, the production process takes the form of a value chain, with many parties contributing value. When this chain is dispersed over various geographical locations, we speak of a global value chain (GVCs).
and the
fourth industrial revolutionA series of related radical innovative breakthroughs centered around automation and digitization technologies. By applying machine learning and large-scale connectivity, these technologies have a large impact on a broad range of existing fields, such as chemistry and mechanics.
in international trade

The broad sectors used in structural change analysis differ in terms of productivity levels and growth rates.
Structural change is considered successful when it leads to higher productivity.
The database uses seven broad sectors of the economy, reports for the period 1991 – 2019, and provides trends for employment, value added and labor productivity for these periods.
The database quantifies the role of structural change in productivity growth over the 1991-2019 period.