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From shock to resilience: Technology policy and SME adaptation under geopolitical trade disruption

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  • Park, Min Jae

Abstract

Geopolitical trade disruptions have become a defining feature of the contemporary global economy, reshaping the interactions among technology, industrial policy and firm competitiveness. We examine how technology-oriented industrial policy enhances the resilience of small and medium-sized enterprises when facing geopolitical shocks. Focusing on Japan's 2019 export restrictions and South Korea's Materials, Parts, and Equipment (MPE) policy response, we conceptualise resilience as a staged process of absorption, adaptation and transformation rather than as an immediate recovery outcome. Using firm-level panel data from 2017 to 2023, propensity score matching combined with a lagged difference-in-difference-in-differences design is utilised to identify the causal and temporal effects of policy support. The results reveal that policy-supported firms exhibit increased export growth, R&D intensity, and innovation output than comparable non-supported firms, with these effects emerging gradually over time. These findings suggest that resilience is a policy-enabled and technology-mediated process of delayed capability building. By providing micro-level causal evidence and integrating a staged resilience perspective, this study contributes to research on industrial policy, firm adaptation and technology-driven resilience under geopolitical uncertainty. The results highlight the importance of temporally structured policy design in fostering long-term industrial transformation.

Suggested Citation

  • Park, Min Jae, 2026. "From shock to resilience: Technology policy and SME adaptation under geopolitical trade disruption," Technology in Society, Elsevier, vol. 87(C).
    • Handle: RePEc:eee:teinso:v:87:y:2026:i:c:s0160791x26001995
    DOI: 10.1016/j.techsoc.2026.103410
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