INDUSTRY 4.0 SIGNIFICANCE TO COMPETITION AND THE EU COMPETITION POLICY: A LITERATURE REVIEW

The coming fourth industrial revolution means many inevitable changes in firms’ competition and the challenges they pose to industrial and competition policies. Therefore, to examine how it is going to affect competition and competition policy, this paper reviews the related literature of industrial policy, industrial organization and new trade theory. For this purpose, employing the semi-systematic review method, the report explores the theoretical background of the Industry 4.0 policy carried out by the EU, how it affects its competition policy and what threats it imposes to competition between firms. We have come to conclusions that the fourth industrial revolution might be quite challenging for the sustainability of firm’s competition and the structure of industry and markets. However, the ‘soft’ EU industrial policy adequately addresses this problem by supporting SMEs with innovation and RD to ensure sustainable competition in the long term.