Performance and Framework Conditions for Innovation

This chapter first reviews Korea’s macroeconomic performance, with its above-average OECD-area economic growth and sustained shift towards high-technology production. It then considers the structural features of the Korean economy: the unique role of the chaebol, the position of SMEs, the productivity gap between manufacturing and services, regional economic imbalances, and relatively low levels of internationalisation. It then turns to an examination of the framework conditions for innovation: the business environment, competition policy, and product and labour market conditions. A final section assesses and benchmarks Korea’s performance in science, technology and innovation (STI), with a focus on indicators such as research spending, publication and patenting rates, and human resource capacity.