Exploring the Paths and Insights for Regional Industrial Upgrading Based on HFS Model

Abstract

Given economic globalization and the advancement of information technology, traditional industries face the risk of hollowing out. The rise of de-globalization has challenged China’s global economic activities and resulted in supply chain crises. To resolve the current industrial bottlenecks in the country, achieving industrial upgrading is the key. This article applies a HFS (Hardware-Firmware-Software) model inspired by processor systems to the production network framework. It investigates the activities driving industrial upgrading from the perspective of the labor division in value chains and proposes corresponding paths to the goal. By pursuing industrial upgrading, industrial reform can be conducted in areas with limited comparative advantages. This enables industries to move from relying on single advantages to leveraging their comprehensive strengths in competition.