Neighbours with Different Innovation Patterns: The Implications of Industrial and FDI Policy for the Openness of Local Knowledge Production
32 Pages Posted: 11 Jun 2020
Date Written: April 30, 2020
This article shows evidence that FDI policies during the catch-up process may leave a trace in the openness of innovation activities in latecomer economies, based on a comparative analysis between the Republic of Korea and China. The past industrial policies of the Republic of Korea favoured creating local technological competence based on the transfer of foreign knowledge in codified form, leading to a low level of global connection in local knowledge creation. By contrast, Chinese policies encouraged the entrance of foreign firms in the Chinese market, leading to a higher level of global interaction in innovation activities. Based on the findings, the article presents policy recommendations and suggests avenues for future research.
Keywords: China, FDI policy, innovation, openness, the Republic of Korea, South Korea, technological catch-up
Suggested Citation: Suggested Citation