Abstract
Perceiving all of the world's economies as pursuing each other up an industrial staircase allows foresight into which industries in which nations are most likely to face increasing competition from those seeking a breakthrough in the race for world markets. The U.S. steel industry illustrates the challenge to intermediate product and complex assembly industries. Had the industry developments of the 1970s and 1980s been foreseen in the 1950s and 1960s, it could have avoided its two major errors: offering excessive labor costs to buy production stability and replicating its existing technology rather than pursuing available innovations. Now the U. S. electronics industry is succumbing to similar challenges at the next higher step on the staircase. It is submitted that clearer recognition of the phenomenon might provide an early warning as to which industries are next, both in the U. S. and abroad, and what comparative advantages can provide them a reasonable defense or an orderly retreat.
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