Volume 44, Number 174,
July-September 2013
The Decline of the United States:
Global Historical Context
Alejandro Dabat and Paulo Leal
COMPETITIVE AND HEGEMONIC ASPECTS OF THE INTERNATIONAL DECLINE ( ...continuation )

Figure 3. Semiconductors: The Productive Capacity of the US as Compared to the World
Source: Semiconductor Industrial Association (2011).

This drop also occurred in the technological base of the electronics sector (microchips), which together with software, military and aerospace, constitutes the foundation of the techno-productive superiority of the nation. Microchip losses occurred not so much in global sales of national companies (which fell from 60% in 2000 to less than 50% in 2011), or in exports from the US (drop from 18% from 2006 to 2010, ITC), but rather in terms of the internal manufacturing capacity for microchips (fab plants in industry jargon) (see Table 4). This last factor is most significant in the long term, because it affects the future of the industry, the entire electronic and information technology sector and the scientific-technological development of the country.25

The recent lag in the US of Fabs is mainly due to higher costs of construction, which went from 1.25 billion dollars in 1997 to 3 billion in 2001, 5 billion in 2007 and 8-10 billion by 2011 for border plants (SourceTech411, 2012).26 Other factors include how rapidly these plants become obsolete, as well as decelerated and uncertain global demand, a decrease in operational profitability, greater investment requirements (McCormark, 2010), public ownership or joint ownership and tax and subsidy exemption requirements. This has favored moving the largest plants to Asia, and not only to Japan, Korea, Taiwan and Singapore, but also to China, more recently to India, and even to the Arabic peninsula (Abu Dhabi). China once again stands out for its governmental policies, enormous public investment capacity, huge internal demand (greater global consumption of microchips) and continuous scientific-educational and technological advances in the sector, which since the end of the past century has been driven by public research universities and institutions (Zhong and Yang, 2009). The importance of public investment and government policies is also true for Abu Dhabi.27


25 Microelectronics has a very close relationship between scientific-technological development and the manufacturing of the microchip (its most advanced level), because it is a highly concentrated industry that requires territorial proximity between r&d and manufacturing, for practical reasons that ideas, tests and industrial achievements must be able to interact. These products cannot be finished without cutting-edge manufacturing techniques (McCormack, 2010).

26 This is a result of the high technical composition of capital and the extreme complexity and technological dynamics of the sector, which is undergoing a vertiginous process of nanotechnology miniaturization of its most basic components to under 30 or even 20 nanometers. It is also marked by revolutions in materials science and an exponential increase in the transistors integrated to the largest wafers (300 mm technology or more). This is know as Rock’s Law, which says that the cost of building a semiconductor chip fabrication plant (fab) tends to double every four years, requiring enormous economies of scale to be compatible with Moore’s Law, which says that in a year and a half the costs to produce a transistor fall by half.

27 Starting with this alliance to adm (the second-largest microprocessor company in the world following Intel), and its state enterprise ATIC, Abu Dhabi began to control Global Foundries, the second-largest subcontractor in the world for this sector (Foundry is industry jargon), with cutting-edge technology and plants in Singapore (6), Germany, the US and Abu Dhabi (to be finished in 2012). As such, besides the alliance with adm, it has established a campus in the US at the Massachusetts Institute of Technology, partnered with the Semiconductor Research Corporation (src), and created its own Masdar Institute of Science and Technology within the emirate (see Wikipedia, atic).

Published in Mexico, 2012-2017 © D.R. Universidad Nacional Autónoma de México (UNAM).
PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 48, Number 191, October-December 2017 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
CP 04510, México, D.F. Tel (52 55) 56 23 01 05 and (52 55) 56 24 23 39, fax (52 55) 56 23 00 97, www.probdes.iiec.unam.mx, revprode@unam.mx. Journal Editor: Alicia Girón González. Reservation of rights to exclusive use of the title: 04-2012-070613560300-203, ISSN: pending. Person responsible for the latest update of this issue: Minerva García, Circuito Maestro Mario de la Cueva s/n, Ciudad Universitaria, Coyoacán, CP 04510, México D.F., latest update: Nov 13th, 2017.
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