【正文】
tic knowledge base is another indicator of Korea’s truncated industrial upgrading. Catchingup required a limited set of capabilities: a capacity to absorb and upgrade imported foreign technology and to develop operational capabilities in production, investment and minor adaptations. This is no longer sufficient today. In 1995, an OECD review of Korea’s NSI concluded: ‘The country can no longer afford simply to import technology which foreigners are in fact more and more reticent to introduce on concessional terms and will have to raise the valueadded and technological intensity of what it produces.’ (OECD 1995b, ) Today, there is an even more powerful reason for such a shift in Korea’s development paradigm: the country simply does not have the foreign exchange required to buy in foreign technology. Korea thus needs to create a broadbased and diversified knowledge base, especially with regard to product design, market development, the production of key ponents and the provision of highend knowledge intensive support services. So far however, Korea’s knowledge base is constrained by three main weaknesses: an insufficient critical mass of Ramp。D。 gross inefficiencies of corporate technology management。 and equally important inefficiencies of its public innovation system. An insufficient critical mass Until around the mid1980s, Korean electronics firms had little motivation co invest in Ramp。D, for the following reasons: First, rapid capacity and market share expansion was much easier, if production was based on imported machines and technology. Second, price petition depended primarily on a bination of low labor costs and selective government support and protection: peting for government resources and contracts has been the essence of petition. Third, continuously high rates of inflation and high interest rates have acted as powerful disincentives to Ramp。D expenditures: they have driven investment into real estate speculation rather than into highrisk Ramp。D. Fourth, industrial promotion policies were biased towards quantitative goals and neglected industrial upgrading: firms received support ‘…on the basis of their export volumes… irrespective of their achievements in capital and labor productivities, valueadded, and technologies (Sun G. Kim 1995, ). In the 1980s Korea’s parative labor cost advantages eroded, product life cycles shortened and petition intensified in the electronics industry. This has forced the Korean electronics industry to develop its own Ramp。D capacity (Kim 1997a, chapters 6 and 7). In 1985, for example, there were 5,249 persons engaged in Ramp。D in the electronics industry, and this accounted for 32% of the researchers in the entire Korean industry. By 1990 this number had risen to 12,865 and accounted for 37% of total Ramp。D personnel in Korean industry. Korea’s Ramp。D spending as a ratio of total sales increased from % in 1976 to % in 1990. While this is an impressive achievement, it is still less than half of the current Ramp。D/sales ratios of . and Japanese manufacturing panies. And Kore