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Development Factors and the Policy for Activating Industrial Innovation Clusters in Regions

Author Byeon, Changuk et al. Date 2018.12.14 Page

Industrial clusters have contributed to the economic performance of national and regional development in the process of rapid economic growth of Korea. However, recent changes in the environment at home and abroad are expected to have effects on the formation and development of industrial clusters. It is necessary to consider these changes on how to design and implement relevant policies to guide and support the development of the cluster.  


Under this background, the aim of this study is to analyze the development factors of the cluster and suggest policy directions. Through the analysis of the recent trend of clusters, economic performance of clusters have created, and developmental factors, we suggested the policy direction toward which clusters can adapt to environmental changes. 


First, Cluster policies need to reflect the characterics each clust rather than formal and uniform policy program implementation. The cluster policy should have a direction to dynamically explore the development process of clusters in order to overcome the crisis situation faced with rapid technological change and to seek route rediscovery and further expanded regional development strategy.  


Second, local industrial clusters in Korea have a high economic status, but they have reached a mature stage. The effect of agglomeration exists, but gradually being reduced. Efforts to secure diversity of industrial structure in the cluster are needed.  


Third, the analysis based on the industrial point of view suggests that the effect of agglomeration is weakened due to deterioration of overall capacity of industries in clusters, deepening of competition among regions and degradation of connectivity with service sectors.  


Fourth, from the viewpoint of knowledge, we found that the accumulation of various new knowledge in the cluster contributes to the performance of the cluster, and that the role of the knowledge network to be formed inside and outside the cluster plays an important role on the evolution of clusters.  


In order to respond to the needs for technological and structural change in cluster, we proposed the police directions for the industrial innovation clusters in which innovation can be promoted. The main focus of policy design this is to consider the life cycle of clusters and maintain a dynamic perspective, not a uniform policy from a static perspective. In addition, the creation of new industries and the discovery of new paths require the design of integrated policies. From an industry perspective, the improvement of industrial capabilities should be considered. It is necessary to ensure the continuity of industrial development of the region where clusters are located, and to select the industry that comprehensively reflects the capabilities of the industries and regions. In particular, the improvement of industrial and spatial scope is required, and the linkages between the core industry and other industries should be strengthened. From a knowledge perspective, the activation of the knowledge network should be sought. It is necessary to secure the network size through the cultivation of the innovation manpower, and expand the range of knowledge diffusion through participation and linkage of various types. The critical size of the network should be secured through the development of new talent in the region. Participation and linkage of various types of innovate agents such as universities and research institutes as well as local firms would help to enhance the effect of knowledge diffusion. The formation and utilization of the network hubs would contribute to intensify the network connectivity. Finally, knowledge heterogeneity must be secured through the gradual expansion of relations with other regions.