Abstract
Cluster theory is considered one of the most well-known industrial strategies. Following the success attained by several clusters in developed countries in the global manufacturing and information technology market, a number of emerging nations have attempted to build up industry-specific clusters. Numerous clusters have been formed across the world. However, most researchers focus on developed nations rather than developing ones, when empirically analyzing the impact of clusters on economic performance of firms, based on core-technology type. Therefore, this study aims to investigate the effects of innovation clusters and core-technology type (namely, information technology, biotechnology, nanotechnology, and medical technology) on the economic performance of firms in one of South Korea’s innovation clusters. A widely employed statistical method, a series of factorial analyses of variance, is used to analyze sample data on firms located in Daejeon Daedeok Innopolis, the biggest cluster in South Korea. The results show a notable clustering effect on firms’ economic performance and new job creation. In addition, the type of core technology significantly affects intensity of effect of the cluster on new job creation and economic performance of the firms. Finally, this study presents implications for both academia and industries.
Article PDF
Similar content being viewed by others
Avoid common mistakes on your manuscript.
References
Arikan, A. 2009. Interfirm knowledge exchanges and the knowledge creation capability of clusters. Academy of Management Review, 34: 658–676.
Audretsch, D. B. & Thurik, A. R. 2001. What’s new about the new economy? Sources of growth in the managed and entrepreneurial economies. Industrial and Corporate Change, 10:267–315.
Beaudry, C. & Breschi, S. 2003. Are firms in clusters really more innovative?. Economics of Innovation and New Technology, 12:325–342.
Brusco, S. 1990. The idea of the industrial district. Its genesis. Industrial districts and inter-firm cooperation in Italy, eds. G Becattini, F Pyke & W Sengenberger, Geneva, International Institute for Labour Studies.
Boschma, R. A. 2005. Proximity and innovation: A critical assessment. Regional Studies, 39: 61–74.
Brenner, T. 2004. Industrial clusters. Existence, emergence and evolution. Routledge, London, UK.
Casper, C. & Karamanos, A. 2003. Commercializing science in Europe: The Cambridge biotechnology cluster. European Planning Studies, 11:805–822.
Chen, S. & Choi, C. J. 2004. Creating a knowledge-based city: The example of Hsinchu Science park. Journal of Knowledge Management, 8: 73–82.
Feng, Z. H. A. O. 2005. Innovation: The core for structure optimization and industrial upgrading. Finance & Trade Economics,10:1–18.
Freeman, C. 1997. The economics of industrial innovation (3rd ed.). MIT Press, Cambridge, MA.
Furman, J., Porter, M. E. & Stern, S. 2002. The determinants of national innovative capacity. Research Policy, 31:899–933.
Gibbs, R. M. & Bernat. G. A. 1998. Rural industry clusters raise local earnings. Rural Development Perspectives, 12:18–25.
Gordon, I. & McCann, P. 2000. Industrial clusters: Complexes, agglomeration and/or social networks?. Urban Studies, 37:513–532.
Hansen, G. S. & Warnerfelt, B. 1989. Determinants of firm performance: The relative importance of economic and organizational factors. Strategic Management Journal, 10:399–411.
Kenney, M. 2000. Understanding Silicon valley: The anatomy of an entrepreneurial region. Stanford University Press, Stanford, MA.
Kim, J. D. 2011. A Study on a regional innovation system by analyzing innovative activities of entrepreneurs, Journal of the Korean Regional Science Association,27:87–110.
Klepper, S. 2010. The origin and growth of industry clusters: The making of silicon valley and detroit. Journal of Urban Economics, 67:15–32.
Korsching, P. F. & Borich, T. O. 1997. Facilitating cluster communities: Lessons from the Iowa experience. Community Development Journal, 32:342–353.
Kwon, O. H. 2004. A Study on the institutional supporting system for forming industrial cluster in large area. Journal of the Economic Geographical Society of Korea, 7:315–328.
Kwon, S. J., Park, E. & Kim, K. J. 2014. What drives successful social networking services? A comparative analysis of user acceptance of facebook and twitter. The Social Science Journal, 51:534–544.
Kwon, S. J., Park, E., Ohm, J. & Yoo, K. 2015. Innovation activities and creation of new employment: An empirical assessment of South Korea’s manufacturing industry. Social Science Information. Internet accessed on 16 July 2015: http://ssi.sagepub.com/content/early/2015/04/28/05390184155 80190.abstract
Lai, H. & Shyu, J. Z. 2005. A Comparison of innovation capacity at science parks across the Taiwan strait: The case of Zhangjiang high-tech park and Hsinchu science-based industrial park. Technovation, 25:805–813.
Lee, S. & Lee, K. 2008. A comparative study of innovative cluster on gumi and Changwon national industrial complexes. Journal of the Korean Regional Development Association, 20:1–27.
Lin, C., Tung, C. & Huang, C. 2006. Elucidating the industrial cluster effect from a system dynamics perspective, Technovation, 26:473–482.
Lundvall, B. A., Joseph, K. J., Chaminade, C. & Vang, J. 2009. Handbook of innovation systems and developing countries: Building domestic capabilities in a global setting. Edward Elgar, Cheltenham, UK.
Lundvall, B. A., Patarapong, I. & Vang, J. 2006. Asia’s innovation systems in transition. Edward Elgar, Cheltenham, UK.
Malmberg, A. & Maskell P. 2006. Localized learning revisited. Growth and Change, 37: 1–18.
Marais, L. 2011. Local economic development and partnerships: Critical Reflections from South Africa. Community Development Journal, 46:49–62.
Meng, Q. & Li, M. 2002. New economy and ICT development in China. Information Economics and Policy, 14:275–295.
Mortensen, D. T. & Pissarides, C. A. 1994. Job creation and job destruction in the theory of unemployment. Review of Economic Studies, 61:397–415.
Neumark, D. 2013. Spurring job creation in response to severe recessions: Reconsidering hiring credits. Journal of Policy Analysis and Management, 32:142–171.
Nishimura, J. & Okamuro, H. 2011. R&D productivity and the organization of cluster policy: An empirical evaluation of the industrial cluster project in Japan. The Journal of Technology Transfer,36:117–144.
Park, E., Kwon, S. J., Kim, H., Ohm, J. & Chang, H. J. 2014. What is the right R&D strategy for overcoming the difficulties of the South Korean IT industry?. Information Technology for Development, 20:339–352.
Park, S. O. & Chung, D. C. 2012. Evolution of industrial cluster and policy: The case of Gumi city, Korea. Journal of the Korean Geographical Society, 47:226–244.
Park, Y. W., Amano, T. & Moon, G. 2012. Benchmarking open and cluster innovation: Case of Korea. Benchmarking: An International Journal, 19:517–531.
Pietrobelli, C. & Rabellotti, R. 2011. Global value chains meet innovation systems: Are there learning opportunities for developing countries?. World Development, 39:1261–1269.
Pinch, S. & Henry, N. 1999. Paul Krugman’s geographical economics, industrial clustering and the British motor sport industry. Regional Studies, 33: 815–827.
Pinto, P. M. & Timmons, J. F. 2005. The political determinants of economic performance political competition and the sources of growth. Comparative Political Studies, 38:26–50.
Porter, M. E. & Stern, S. 2001. Innovation: Location matters. MIT Sloan Management Review, 42:28–36.
Porter, M. E. 1998. Clusters and the new economics of competition. Harvard Business Review, 76:77–91.
Porter, M. E. 2000. Location, competition, and economic development: local clusters in a global economy. Economic Development Quarterly, 14:15–34.
Porter, M. E. 1990. The competitive advantage of nations. Harvard Business Review, 68:73–93.
Rosenfeld, S. A. 1997. Bringing business clusters into the mainstream of economic development. European Planning Studies, 5:3–23.
Salvador, E., Mariotti I. & Conicella, F. 2013. Science park or innovation cluster?: Similarities and differences in physical and virtual firms’ agglomeration phenomena. International Journal of Entrepreneurial Behaviour & Research, 19:656–674.
Smirnova, Y. V. 2012. Innovation infrastructure as a vital element of national innovation system: Case of Kazakhstan. In Proceedings of the 10th GlOBELICS International Conference,. pp. 1–20.
Sohn, D. & Kenney, M. 2007. Universities, clusters, and innovation systems: The case of Seoul, Korea. World Development, 35:991–1004.
Trigari, A. 2009. Equilibrium unemployment, job flows, and inflation dynamics. Journal of Money, Credit and Banking, 41:1–33.
Wheaton, W. C. & Lewis, M. J. 2002. Urban wages and labor market agglomeration. Journal of Urban Economics, 51:542–562.
Wong, P. K., Ho, Y. P. & Autio, E. 2005. Entrepreneurship, innovation and economic growth: evidence from GEM data. Small Business Economics, 24:335–350.
Yoo, K., Park, E., Kim, H., Ohm, J., Yang, T., Kim, K. J., Chang, H. J. & del Pobil, A. P. 2014. Optimized renewable and sustainable electricity generation systems for Ulleungdo Island in South Korea. Sustainability, 6:7883–7893.
Yu, J. & Jackson, R. 2011. Regional innovation clusters: A critical review. Growth and change, 42:111–124.
Acknowledgements
This study was supported by the Dongguk University Research Fund of 2015. This study was also supported by the National Research Foundation of Korea Grant funded by the Korean Government (NRF-2014S1A5A2A01011769).
Author information
Authors and Affiliations
Corresponding authors
Additional information
Korea Institute of Civil Engineering and Building Technology (KICT), Goyang, Republic of Korea
Korea Advanced Institute of Science and Technology (KAIST), Daejeon, Republic of Korea
Dongguk University, Department of Business Administration, Gyeongju, Republic of Korea
Corresponding Authors: ksyoo@djtp.or.kr (Kyeongsik Yoo), johm@kaist.ac.kr (Jay Y. Ohm)
Rights and permissions
Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made.
The images or other third party material in this article are included in the article’s Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article’s Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.
To view a copy of this licence, visit https://creativecommons.org/licenses/by/4.0/.
About this article
Cite this article
Park, E., Yoo, K., Kwon, S. et al. Effects of innovation cluster and type of core technology on firms’ economic performance. J Engin Res 4, 17 (2016). https://doi.org/10.7603/s40632-016-0017-z
Revised:
Accepted:
Published:
DOI: https://doi.org/10.7603/s40632-016-0017-z