Some Characteristics of Regional-Industry Deployments in New Zealand and Korea From the Perspective of Cluster Theory

Abstract

Amid a conversion of our economies into borderless society that represents to globalization and IT revolution, competitive industries or corporations in the world are increasingly concentrated in specific regions or cities such as Silicon Valley and Amelia- Romanizoo renowned as the third Italia. From a corporate perspective, the strategies of clustering, especially among small and medium-sized companies attract a lot of attention these days as they are based on the assumption that it is easier and more efficient for them to utilize locally available management resources and capabilities by bringing in know-how or knowledge from outside than to establish it internally. As the world economy enters into an epoch of knowledge-based economic system with much emphasis on innovation, clustering is recognized as an effective means to enhance regional and industrial competitiveness. On the other hand, some scholars such as Mckelvey are casting a doubt on the advantages of clustering as an effective way to elevate the competitiveness of a particular region and/or industry. In particular, they maintain that a geographical proximity toward supplementary knowledge and capability is not always appropriate or optimal for the growth of all small and medium-sized companies that have experienced innovation. The concrete example of their doubt is New Zealand, which have grown and obtained success in (almost) all industries on a global scale without resorting to their regional resources or capabilities. What is implied in this observation is that a geographical proximity is not necessarily an effective factor to develop a regional industry that leads to gaining regional superiority while at the same time a clustering policy aimed at supporting the growth of a regional industry is not always appropriate for all cases. If a geographical proximity is not the essential factor to drive the growth of small and medium-sized companies, what other factor might there be then? Based on this question, this paper compares New Zealand with Korea from the perspective of previous researches on clustering theory. Characteristics of industry deployment of New Zealand and Korea are presented along with the comparison and analysis of clusters of both countries in terms of performance, based on two previous researches as described below. The first one is the research conducted by Jon-in Choi on how Daedeok Research Complex, the first-oHts-kind cluster in Korea, has developed as a revolutionary role model. The next one is the research done by Sally Davenport that has clearly presented what has been the driving factor to promote the growth and development of an industry cluster in New Zealand with negative view on the superiority of clustering. Based on these earlier researches, I have presented what roles should be accomplished in order for small and medium-sized companies to firmly establish an industry cluster for regional advantage as opposed to other competing regions and what is needed to provide the region with a driving force for its growth and also to lead it to an economic development and prosperity.