An Analysis of the Innovation-Driven Regional Growth Strategy at the Regional Level in South Korea

December 31, 2019

The economies of China, the U.S., Korea and Japan are rapidly changing. Amid trade issues and the ongoing Fourth Industrial Revolution (4IR) the Korean economy is entering an era of low growth. In this era, Korea is facing crises and opportunities in terms of its industrial economy. The problem is that in local areas outside the capital Seoul area, these issues are more crisis than opportunity. Is there any regional industrial policy that will turn the current crises into opportunities?

When the Korean economy was a fast-follower the central government prepared a somewhat predictable roadmap and thus the efficiency of resource allocation and utilization of national assets and economic growth could be expected. Now a first mover in a low-growth phase, the Korean economy needs a rapid response and industrial strategy based on innovation in the era of regional industrial crises and the 4IR. In particular, it is important for industrial policies to take account of local assets that have not yet been utilized for regional industrial transformation and innovation that requires an immediate response to industrial issues.

However, there are not many studies on decentralization and region-led innovation growth strategies that make the best use of various regional assets,respond quickly to industrial crises or transitions or lead to innovation.