This study starts with two premises: first, business enterprises are at the center of the innovation economy and second, entrepreneurial activities are most effective within a well-functioning innovation ecosystem. Accordingly, the analyses are comprised of certain aspects of the innovation activities of business enterprises as well as the systemic aspects of the Korean innovation system (KIS). Policy implications are also presented for Korea’s innovation-driven growth strategy including enhancing the innovative capacities of business enterprises and upgrading the support systems surrounding them.

The first, analytical part of the study deals with some of the key aspects of business enterprises’ innovation activities, such as the patterns of business innovation, the relationship between industrial organizations and business innovation and that between M&A activities and business performance. The section also introduces the results of a management survey, which is the first one of its kind in Korea. The second, systemic part contains two chapters on Korea’s innovation system: one on the distinctive nature of the KIS and the other on its evolutionary process. Additionally, in regards to the importance of human resources as a permanent and ultimate source of innovation, one of the following chapters makes a cross-country comparison between adults’ skills and another deals with Korea’s re-training system.

Despite the necessity of the government’s involvement in building an effective innovation ecosystem, government intervention is not straightforward. Governments face the same uncertainties as the market― although often with much more intensity―caused by the rapid changing nature of techno-economic paradigms. In this regard, the fourth industrial revolution presents a prime example. Policies will be most effective when business enterprises respond to the government’s initiatives with their own investments. The list of such policies includes: creating open, competitive market environments; pursuing a two-thronged labor policy of strengthening labor competence and enhancing flexibility in the labor market and; redirecting science and technology policies in a way that enhances the linkage between innovation actors such as business enterprises, universities, and government-funded research institutes. The government should also strive to improve system efficiency with consistency over longer-terms.

99. Korea’s Road to an Innovation Economy: Enhancing Productivity through Structural Transformation and Institutional Reform

Preface
Executive Summary

Chapter 1 Key Issues in Innovation-Driven Growth: Framework and Policy Implications
　Section 1 Introduction
　Section 2 Literature Review on Innovation and Growth
　Section 3 Analytical Framework and Policy Implications
　Section 4 Report Structure
　References
　Appendix

Part 1 Analysis of the Current Innovation Environment

Chapter 2 Korea’s National Innovation System and Corporate Innovation Activities
　Section 1 Introduction
　Section 2 Components of the Technology System and Use of Innovation Surveys
　Section 3 Categorization of Innovation and Characteristics of Korean Firms
　Section 4 Cluster Analysis
　Section 5 Conclusion and Implications
　References
　Appendix

Chapter 3 Corporate Management and Innovation in Korea
　Section 1 Research Motivation
　Section 2 Relevant Literature
　Section 3 Survey Design and Data Collection
　Section 4 Empirical Findings
　Section 5 Conclusion and Policy Implications
　References
　Appendix

Chapter 4 Market Competition and Innovation Outcomes
　Section 1 Introduction
　Section 2 Methodology and Empirical Analysis
　Section 3 Summary and Conclusion
　References
　Appendix

Chapter 5 The Role of Venture Capital in Start-up Innovation
　Section 1 Background
　Section 2 Role and Limitations of Venture Capital in Start-up Innovation
　Section 3 International Case Studies on Venture Capital
　Section 4 Enhancing Venture Capital’s Role in Startup Innovation
　Section 5 Conclusion
　References
　Appendix

Chapter 6 Changes in the Internal Potential of Acquired Companies through Mergers and Acquisitions (M&A)
　Section 1 Research Background and Purpose
　Section 2 Theoretical Review of M&A
　Section 3 Research Methodology
　Section 4 Data Collection and Status of Domestic M&A
　Section 5 Empirical Analysis Results
　Section 6 Conclusion
　References
　Appendix

Part 2 Innovation Growth Support Systems

Chapter 7 Evolution of Korea’s National Innovation System: Evaluation and Future Prospects
　Section 1 Introduction
　Section 2 Developmental Phases of the Innovation System
　Section 3 Evaluation of the Innovation System
　Section 4 Transitioning to Innovation-Led Growth
　Section 5 Conclusion
　References

Chapter 8 Diagnosis and Development of the Science and Technology Innovation Ecosystem
　Section 1 Introduction: Reset Korea
　Section 2 Economic Growth and Science and Technology
　Section 3 Assessment of the Science and Technology Innovation Ecosystem
　Section 4 Development Strategies for an Innovation-Driven Ecosystem
　Section 5 Concluding Remarks
　References

Chapter 9 International Comparison of Cognitive Competencies
　Section 1 Introduction
　Section 2 Data Overview
　Section 3 Cross-Country Comparison of Cognitive Skills Distribution
　Section 4 Cross-Country Comparison of Skill Allocation
　Section 5 Conclusion
　References
　Appendix

Chapter 10 Reforming the Vocational Training System to Adapt to Economic and Social Changes
　Section 1 Introduction
　Section 2 Economic and Social Changes in Workforce Development
　Section 3 Limitations of the Current Vocational Training System
　Section 4 Vocational Training as a Universal Right
　Section 5 Proposal for a New Vocational Training System
　Section 6 Conclusion
　References

Chapter 11 Policy System Reform for Innovation-Driven Growth
　Section 1 Introduction
　Section 2 Literature Review
　Section 3 Hypotheses on Innovation-Driven Growth
　Section 4 Data and Analysis
　Section 5 Empirical Findings
　Section 6 Conclusion and Policy Implications
　References

Chapter 12 Summary and Conclusion
　Section 1 Summary of Research Findings and Implications
　Section 2 Pathways to Innovation-Driven Growth
　Section 3 Future Research Directions
　References

ABSTRACT