The purpose of this study is to analyze innovation growth policies in the United States, Europe, and Japan, and to draw policy implications for Korea. Accordingly, the report analyzes the characteristics of innovation growth paradigms and three important sectors of the 4th Industrial Revolution (smart factories, start-up ecosystems, and fintech).
   Chapter 2 first analyzes the US government policies on advanced manufacturing, IoT, AI, and Big Data. In addition to support from the federal government, private companies and laboratories are cooperating actively through consortiums such as the Industrial Internet Consortium (IIC), which operates several testbeds. The results of our analysis indicate that the link between government policies and private companies’ strategies is the core of US innovation growth. Second, the innovative growth paradigm in Germany has been changed from the “High-Tech Strategy” to the concept of “Industrie 4.0” and “AI Strategy.” The key to innovative growth in Germany is government-industry-academia cooperation realized through the introduction of use cases and the provision of testbeds. Third, the Japanese government is pursuing the vision of “Society 5.0” for the future of its society, a vision of a society that collects data through IoT technology and utilizes this big data through AI and robots. Japan is also implementing a policy called “Connected Industries” to secure competitiveness in the manufacturing industry by utilizing industrial data. Above all, the Japanese government has been putting efforts into improving the environment for big data utilization by modifying laws and supporting related projects.
   Chapter 3 describes the current status and policies related to smart factories in Germany and Japan. We explain the connection mechanisms and standards applied to smart factories in Germany such as the Open Platform Communications Unified Architecture (OPC UA) and umati, or universal machine tool interface, and present the exemplary cases of Siemens, Bosch and SAP. Furthermore, the Federal Ministry for Economic Affairs and Energy (BMWi) of Germany is utilizing Mittelstand 4.0 Competency Centers to support the digital transformation underlying smart factory projects in Germany. Japan is not yet at the stage of operating virtual factories, and is instead focusing on innovations in manufacturing processes. This innovation of manufacturing processes in Japan is characterized by digitalization, standardization, visualization, and automation, and industrial IoT platforms such as Mitsubishi Electric's Edgecross and Fanuc's FIELD systems have emerged for inter-factory and sectoral connectivity. Meanwhile, the Japanese government provides customized support by implementing public relations activities, dispatching experts, providing IoT tools, IoT taxation, and funding for IoT investment.
   In Chapter 4, we review current startup ecosystems and related policies in the United States, Japan and France. The startup ecosystem in the United States is characterized by synergistic effects of human capital, technological innovation, and venture capital. In terms of policy, the Obama administration supported the development of innovative technologies through the Startup America Initiative and the Jumpstart Our Business Startups Act. However, supporting policy has lost its momentum under the Trump administration, and regulations are expected to be tightened for companies in Silicon Valley. Recent features of the Japanese startup ecosystem can be summarized as the expansion of CVC investment and the increase of young entrepreneurs. Along with the J-Startup policy, the representative startup supporting policy in Japan to foster role model companies, the Japanese government is releasing data and guidelines to promote open innovation between large corporations, universities, research institutes and startups. In France, which is gaining recognition as a growing hub for tech startups, the government and the private sector are interacting actively through “La French Tech,” a government support plan, and Station F, a private startup campus. In 2019, the French government introduced a plan to enhance the competitiveness of the startup ecosystem by diversifying its policies, for instance by strengthening incentives and public relations support.
   Chapter 5 describes fintech trends and policies in the United States, Japan and the United Kingdom. The US government adopts a negative regulatory approach, and financial authorities examine legitimacy and provide guidelines to remove uncertainties in fintech services. Japan is encouraging the emergence of new fintech companies and services by introducing and amending relevant laws (the Banking Act, the Money Payment Act, and the Financial Instruments Transactions Act). The Financial Services Agency (FSA) is providing regulatory consultations through its Fintech Support Desk and Fintech Experimental Hub. Moreover, in terms of blockchain technology, Japan is strengthening its cooperation network by conducting joint research and round tables with overseas organizations. The UK, which is highly competitive in the financial industry, is actively supporting fintech by deferring regulations through a regulatory sandbox. The UK government is also establishing a fintech-friendly regulatory environment by hiring people with wide experience in the banking and fintech industries. Level 39, a fintech cluster, provides not only office space but also opportunities to network with investors and accelerators. In addition, the fact that successful fintech companies in the UK can easily enter overseas markets makes the UK more attractive for fintech companies.
   Following an analysis of the Korean government’s paradigm for innovative growth and policies related to smart factories, the startup ecosystem, and fintech, we compare these with major economies to draw the following policy implications. First, Korea should expand government R&D investment in 5G infrastructure and AI technology to build a hyper-connected intelligent society. It will also be critical to establish a whole-of-government agency to promote government-industry-academia cooperation and to provide test beds for innovative technologies. Second, we need to establish a clear and unified concept of smart factories and to build industrial IoT platforms. In addition, customized support that meets the needs of SMEs is required for SMEs to become smart factories. Third, with regard to the startup ecosystem, we could consider applying a comprehensive negative regulation system and promoting open innovation. Also, it is necessary to build an integrated support team for startups like the French Tech National Team in France. Fourth, deregulation should be carried out to foster the fintech industry in Korea. In addition, further efforts should be made to analyze successful overseas fintech business models and to review the adverse effects related to fintech. Meanwhile, it would be beneficial to review the legal system and pay more attention to strengthening domestic and international networks in order to revitalize fintech with a proper management system. Lastly, government authorities should adopt innovative approaches to improve financial regulation, as well as provide active and customized support including support for overseas expansion.