This study examines the machine tools industry from the sectoral innovation system perspective. The machine tools industry has a strategic importance because it determines the competitiveness and efficiency of the engineering industries as the primary sector producing investment goods. Today, the most important factor affecting the industry of machine tools is the transition from the third industrial revolution to the fourth industrial revolution. This new technological trajectory will be decisive in the future of the sector. To maintain the global competitiveness of its manufacturing industry, Turkey is obliged to give adequate attention to its machine tools industry. In the scope of the study, the situation and problems of the Turkish machine tool sector were examined from the theoretical framework of the sectoral innovation system approach. According to the results of the study, the accumulation of technological capabilities of the Turkish machine tool industry is not enough to use the opportunities created by Industry 4.0. Therefore, in order to catch up with the new industrial revolution, policy makers need to apply technology policies urgently to accelerate technological development in the machine tool industry.
Keywords: Sectoral System of Innovation, Machine Tool Industry, Technological Trajectory, Industry 4.0