Analysis based on Q2 internal investment, education, innovation, people, R&D

A major role in what seems to be rather a short period of time of massive development of
South Korea has been played by the investments and reforms that the government did on
education and science. After developing higher education institutions with private investment
resources, the Korean government has implemented several policies in order to enhance the
science production amidst all higher education institutions. In addition to this, the government
has managed to harvest a social culture that emphasized the importance of developing science
and scientists, as an overall objective.

After the Korean War, all efforts have focused around creating educational opportunities for
all eligible children. In addition, in terms of higher education institutions, many private
institutions have been established in order to accommodate the growing number of students.
After the 1960 Revolution, a military government has taken control over the country for the
following three decades. One of the first reforms was to make primary and secondary
education universal, while also expanding higher education. In order to be in full alignment
with its plans, of creating a prepared workforce that had to be able to achieve the ambitious
economic development, the government imposed several policies in order to ensure the
quality of education. In this sense, a Public School Act and a university entrance preparatory
exam have been introduced. Furthermore, the government pursued the overall expansion of
the country’s scientific production by transforming Korean colleges and universities into
world class research centers. This movement has been aligned with shifting the global
public’s perception in terms of cultural values. While engineers were seen “on the lower end
on occupational hierarchy” and lawyers, scholars and government officials were kept in high
regard, the government managed to change this belief through was called the Learning
Science Movement. Thus, it was implemented the idea according to which science and
technology are decisive for the country’s development. This movement managed to bring
back Korean researchers living abroad and to reduce the known phenomenon of “brain drain”.
Moreover, many incentives have been provided for those “who obtained advanced degrees in
science”. In addition, in order to be utilize effectively the resources at hand, the government
proposed the establishment of “centers of excellence” (the most known ones being the
Engineering Research Centers and the Science Research Centers) within universities, thus
achieving “academic collaborations and interdisciplinary research” (Kim and Choi, 2017).
On the other hand, as studies have shown, science and technology are closely linked with
economic growth and innovation. In their own acceptance, Kima et al (2019) suggest that the
“innovative growth” is related to value creation. According to research, since 1982, the public
investments in Korea have been oriented towards research activity. R&D can lead to national
economic growth by creating “newly converged industries, creative services and
technological invention and innovation”. According to research, South Korea is regularly
investing in R&D, thus managing to become the second from the OECD countries in terms of
expenditure on R&D (Kima et al, 2019).

Furthermore, in a globalized world, a competitive advantage for countries could be

represented by strategic innovation. Companies are becoming more concerned with their
innovative competencies and politicians with welfare, growth and employment. All measures
adopted by the Korean government, namely the support for Korean family holdings, the
policies and reforms in education that provided qualified human resources, the export oriented
policies that exposed companies to international markets, the investment in R&D, helped
create the perfect premises for innovation in South Korea (Ercișa and Ünalanb, 2016).

For a country such as South Korea, innovation represents a key factor that is deeply involved
in the performance of companies and also in the overall performance of the country, as well as
in its economic growth. According to Ercișa and Ünalanb (2016), innovation is directly linked
with macroeconomic factors such as GDP/capita, R&D expenditures, competitiveness and
level of profit. In the context of a globalized world characterized by a global economy, South
Korea has understood the importance of innovation and its connection with strategy, both in
terms of implementation and thinking. Concerned with the welfare of the society as a whole,
governments should be highly focused on taking the necessary steps and implementing the
measures in order to achieve the potential of a country, as suggested by Ercișa and Ünalanb
(2016). In this sense, innovation must be connected with the creation of new ideas, market
and business sophistication as well as with human capital and research. As showed in the
research documented by Ercișa and Ünalanb (2016), the Global Innovation Index can be used
in order to highlight the areas in which a country is innovative. For the case of South Korea,
although innovation and its implementation in the private sector is missing, the government
has been involved in a actively trying to support this phenomenon, by investing in education
(human resources), acquiring technology to support innovation and orienting towards exports
to international markets, thus being exposed to international competition. Consequently, being
favored by the foreign investment and the rapid adoption of technology, the Southeast Asian
economies (which includes South Korea) have proven to be motivated by the socio-economic
development that was brought with the innovation wave.

In this sense, the focus should be directed towards creating knowledge based economies and
scientific research and development is the main tool that contributes in this regard. As
indicated by Wong (2011), the South Korean government has contributed to the technology
advancement by facilitating the “learning and catching-up with the western technology” for
chaebol firms. Consequently, R&D activities have been introduced in order to emphasize the
importance innovation has as an overall for the country.

As stated previously, education is in direct link with innovation since there is a high need for
specialists in tech field in order to cope with the amount of novelty and high requirements of
this domain.

All in all, in order for South Korea to become a knowledge-based economy, the efforts that
have been put in this sense should be continued, with a special emphasis on education,
training and investment in R&D (Wong, 2011).