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Strategy for Fostering Regional Innovation Ecosystems

Author Yeong-su Kim, Seon-bae Kim, Hyeon-woo Kim, Nam-hee Choi Date 2016.02.01 Page 36
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Investment in research and development (R&D) in Korea has multiplied dramatically in recent years, yet a number of factors have limited an increase in productivity from R&D initiatives. Public research institutions in Korea show lower levels of R&D productivity, fewer records of technology transfer, and less ability to produce results that can be commercialized in comparison with their counterparts in other advanced economies. The public R&D sector in Korea has even had the effect of replacing private R&D (Ju, 2015).
The Korean government’s R&D Innovation Plan, released in May 2015, shows that the government sees this situation as a “crisis of innovation resulting from R&D investment without a strategy.” The fields of R&D overlap extensively among government programs, private-sector businesses, universities, and research institutions, and other public research organizations, with little effort being made towards effective collaboration. Governmental/public research institutions and universities continue to pursue R&D projects isolated from market demand, while researcher-centered and complex systems of evaluation and management continue to undermine the efficiency of their R&D projects.
Local level R&D in Korea shares and amplifies the severity of all of the problems associated with national level public R&D because of the country’s uneven state of development across regions. Numerous local governments have launched ambitious policies to foster innovation, based chiefly on theories of regional innovation systems and clusters. Investment in local R&D has risen significantly since 2000 under a wide range of local policies intended to foster the production, diffusion, and application of knowledge. These policies have supported the development and expansion of special R&D zones, Techno Parks and local R&D clusters, created innovation centers through which local universities can support local businesses, strengthened local universities R&D ties with corporations, set up centers of technical support for local industries, and increased support for local businesses specializing in local strategic industries.
The theories of regional innovation systems and clusters predict that increases in local resources for regional innovation and in support of regional innovators will naturally lead to systems for generating, diffusing, and applying sustainable examples of innovation. The current reality of local and regional level R&D, however, demands that we question this fundamental assumption. This study therefore analyzes the working mechanisms of innovation and innovative activities at a local level from an innovation ecosystem approach. The concept of an innovation ecosystem is relatively new and has yet to develop into a systematic theory. Even though the term “ecosystem” is increasingly used today in discussions about interconnected business, corporate, industrial, and entrepreneurial networks, there is little discourse or in-depth literature on innovation ecosystems available in Korea today.
Local innovation policies have so far focused on developing, strengthening or supplementing the elements that regions are lacking and that are necessary for generating, diffusing, and applying knowledge in those regions. As a result, Korea’s regional innovation systems have all the elements they need. However, the absence of strategies for filling in the gaps of regional innovation systems has limited significant enhancements to the productivity of local innovative endeavors. It is thus high time that we began to explore and develop a new model of regional innovation policy.
The objective of this study is neither to point out the theoretical shortcomings and policy defects concerning regional innovation systems and clusters, nor to replace the conventional approach with a novel theory of innovation ecosystems. Rather, it is to demonstrate that once we start to perceive regional innovation from an ecosystemic point of view rather than as a matter of system or structure, we will be able to create regional innovation ecosystems that are highly compatible with regional societies and capable of sustainable evolution. Our study is rooted in the belief that an ecosystemic perspective can help regional innovation policies become more realistic, performance-centered, and effective for regional conditions and circumstances.
The main purpose of our study, then, is to review problems with regional innovation from an ecosystemic perspective by examining factors critical to regional innovation that have been overlooked by the conventional approach to regional innovation systems and clusters.