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Customized Regional Industrial Policy in Korea Based on Smart Specialization Strategy: Focused on Establishing Smart Regional Innovation Ecosystems (Smart RIES)

Author Kim Sunbae, Lee Doohee, Kim Yunsoo, Ha Jeongseok Date 2016.12.28 Page
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With a great number of economies around the world now stuck in the traps of low growth and stagnation while the Fourth Industrial Revolution is marching forward, various governments at the national and local level are embracing new paradigms in industrial policy. This paradigm shift has in turn prompted regional and local governments to devise industrial policies that cater to the specific needs of their regions, with a focus on establishing ecosystems for innovation and specialization in smart industries. Policy strategies increasingly emphasize collaboration among diverse actors in innovation and convergence as keys to enhancing the value-added of existing industries and creating new engines for growth.  

 

Since 2000, metropolitan and provincial (“regional”) governments in Korea have adopted their own regional industrial policies and strategies, with some achieving success with transformation into new hubs for manufacturing outside the Seoul-Gyeonggi region. The recent crises of a few major heavy industries, however, have forced these regions to take drastic measures towards restructuring. In the meantime, the growing spatial mismatch between R&D investment, service industries and jobs, and skilled workforces in the Seoul-Gyeonggi region and the production facilities in other regions are also posing obstacles to the development and management of regional innovation ecosystems (RIEs). Regional governments in Korea are thus facing growing pressure to adopt cluster-based RIEs to develop new and more innovative ways to ensure the continued growth of regional industries.

 

In this study, we propose a number of measures to improve regional industrial policies in Korea, with a view to developing an effective model for smart RIEs and helping regional governments adopt and apply this model in a systematic, efficient manner.