The Role of Regional Innovation System Characteristics in Regional Growth in Korea

In recent times, local governments and policymakers in Korea have been strongly interested in sustainable growth or job creative growth locally, but how? The purpose of this study was to expand our understanding of the relationship between regional economic growth and the local characteristics of RIS. Of special interest are the determinants of regional economic growth, and also for policy makers, which policy should be first between population policy and employment policy? For solving the problems, this paper first identified the determinants of sources of innovation, knowledge spillovers, and regional spillovers as the principal characteristics of RIS in Korea through empirical review as well as literature review.Through the model specification, Carlino-Mills models (CM models) with three-stage least square (3SLS) estimation are proposed as a conclusive model for the determinants of regional growth in a RIS framework. The findings from the extended CM models indicate a more focused role of RIS characteristics in population and employment growth rates than that in OLS models. The results from the simultaneous equation model (or 3SLS estimations) indicated that the innovative activity of local firms had positive spillovers with regards to increasing in employment growth rates in local areas. Another main conclusion of the analysis was that “jobs follow people.”Thus, given this evidence, policymakers may well consider how to enhance their regions to stimulate innovation and regional growth according to the determinants of regional population growth, and after that those of regional employment growth. Finally, in chapter V, I summarize the empirical findings and provide some conclusions emanating from this body of work, including some policy implications