Catching-Up, Crisis and Industrial Upgrading: Evolutionary Aspects of Technological Learning in Korea's Electronics Industry

Asia Pacific Journal of Management, Vol. 15, Issue 2, 1998

Posted: 6 Dec 1999

See all articles by Dieter Ernst

Dieter Ernst

East-West Center; Centre for International Governance Innovation (CIGI)

Multiple version iconThere are 2 versions of this paper

Abstract

This paper addresses a puzzle related to catching-up: how is it possible that a country that has established a broad, export-oriented industrial base at record speed, remains vulnerable to the vicissitudes of international finance and currency markets? I argue that the Korean model that was tremendously successful during the catching-up phase, has now reached its limits for two reasons: it generates unsustainable high debt-equity ratios, and it is out of touch with current industrial upgrading requirements. The analysis centers on the co-evolution of industry structure and firm behavior. The focus is on the role of technological learning for the development of the electronics industry, a main carrier of Korea's successful late industrialization. It is shown that a heavy reliance on credit and an extremely unbalanced industry structure have given rise to a narrow knowledge base and a sticky pattern of specialization. Catching-up has focused on capacity and international market share expansion for homogeneous, mass-produced products such as TV sets. monitors, DRAM and displays (commodities); very little upgrading has occurred into higher-end and rapidly growing market segments for differentiated products and services that require flexible production (e.g., design-intensive ICs and computer products, software and Internet services). Such truncated upgrading is one important reason for Korea's vulnerability to the financial and currency crisis.

Note: This is a description of the paper and is not the actual abstract.

JEL Classification: L16, L63, O12, O19, O33

Suggested Citation

Ernst, Dieter, Catching-Up, Crisis and Industrial Upgrading: Evolutionary Aspects of Technological Learning in Korea's Electronics Industry. Asia Pacific Journal of Management, Vol. 15, Issue 2, 1998. Available at SSRN: https://ssrn.com/abstract=136719

Dieter Ernst (Contact Author)

East-West Center ( email )

1601 East-West Road
Honolulu, HI 96848-1601
United States

Centre for International Governance Innovation (CIGI) ( email )

57 Erb Street West
Waterloo, Ontario N2L 6C2
Canada

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
809
PlumX Metrics