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Problems with Korean Local Governments’ Selection of Key Industries from the Perspective of Enhancing Production Capabilities: An Analysis Using Product Space Model

  • Journal of Asia-Pacific Studies
  • Abbr : JAPS
  • 2023, 30(3), pp.155-206
  • DOI : 10.18107/japs.2023.30.3.006
  • Publisher : Institute of Global Affairs
  • Research Area : Social Science > Social Science in general
  • Received : August 16, 2023
  • Accepted : September 14, 2023
  • Published : September 30, 2023

PARK KYUNG SUK 1

1전남대학교

Accredited

ABSTRACT

Korean local governments select key industries and provide policy support for regional industrial development and economic growth. To ensure the successful execution of regional industrial development policies, the most critical factor is the appropriate selection of key industries. This study analyzes whether the key industries of 13 Korean local governments have been appropriately selected from the perspective of enhancing regional production capabilities. To do this, we analyzed the characteristics of the key industries of 13 local governments by applying the method provided for selecting strategic industries based on product space model. The results of this study reveal two common problems in the selected key industries across the 12 local governments, excluding Jeju. Firstly, the structural characteristics of local industries, such as the technological linkage with specialized industries within the region and the potential contribution of each key industry to production capabilities, were not adequately considered. Secondly, despite the increasing contribution of high-value-added service industries to production capabilities, selected key industries were still concentrated in the manufacturing sector. This study provides the following policy implications. Firstly, local governments should select, in a more long-term perspective, key industries to ensure that the structural characteristics of local industries are reflected. Secondly, local governments with relatively high production capabilities should adopt a stable approach focused on growth-promising industries that are technologically close to specialized industries, while local governments with relatively low production capabilities should pursue a more challenging approach focusing on growth-promising industries that are technologically close to non-specialized industries. Lastly, in the case of choosing a challenging approach, it should pay attention to high-value-added service industries in the selection of key industries.

Citation status

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