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Unformatted text preview: T he globalization of advanced technological production provides no better model for success than South Korea and Taiwan’s experience in semiconductor manufacturing. Two decades ago, South Korean and Taiwanese firms entered the most technologically challenging and intensely competitive industry in the global economy. By the mid-1990s, both emerged from relative anonymity to become the third and fourth largest semiconductor producers in the world, behind the United States and Japan. Spanning this time period, South Korea’s semiconductor production grew from less than one percent to ten percent of total global output, reaching $16.5 billion by 1995. 1 Even though Taiwan began three years after South Korea, their growth has been equally impressive, growing to $5.3 billion dollars of revenue and seven percent of the total world output by 1997. 2 By 2002, South Korea’s semiconductor industry was producing $12 billion of output and Taiwan’s was producing $8.5 billion per year. 3 e forces underpinning South Korea and Taiwan’s ability to close this technological gap possesses wide considerations for development theory, particularly for nations seeking to establish advanced production. Identifying and examining the forces underpinning their success tests developmental theory through an empirical case study. In one perspective, South Korea and Taiwan’s achievements can be viewed as a testament to the effectiveness of the developmental state. Both countries overcame enormous barriers to establish leading industries at the forefront of semiconductor manufacturing; undoubtedly, the state played a large role in the establishment of these industries. More recently, revisionist arguments point to the reorganization of the global division of labor by American transnational corporations as an equally important force driving this development. If indeed the state was the primary force driving technological development, then their policies can be applied to developing countries attempting to take part in the globalization of high technology manufacturing. If the outsourcing of production by American transnational firms was an equally important force, then developing countries could embed themselves within burgeoning production networks. Connecting South Korea and Taiwan’s historical experience to these theoretical underpinnings can verify arguments and expose missing contexts, which in turn refines understandings of technological development. is paper will contrast these two theories, and incorporate them into a broader perspective by widening the context for South Korea and Taiwan’s success through the examination of market space. Statist and Revisionist Arguments e majority of explanations for South Korea and Taiwan’s success in semiconductor manufacturing place it within the discourse of the developmental state, defined by theorists such A New Context for Technological Development Reconsidering South Korea and Taiwan’s Semiconductor Success through...
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This note was uploaded on 04/29/2010 for the course ECON 4450 taught by Professor Wan during the Spring '09 term at Cornell.
- Spring '09