Dr. Keun Lee is an editor of Research Policy, the director of the Center for Economic Catch-up, and a professor of economics at the Seoul National University. He is a member of Committee for Development Policy, UN. He holds a Ph.D. degree from the University of California, Berkeley. He was a consultant at the World Bank, lecturer at the University of Aberdeen, Scotland, and a research fellow at the East West Center, Hawaii. He specializes in economics of catch-up addressing such themes as firm growth, industrial policy, and innovation with focus on Korea and China. [You can download all of his papers from his web home (www.keunlee.com). Phone: 82-10-27290418 Address: economics department,
seoul national university
shillim-dong, Seoul 151-746 KOREA
One of the puzzles about why some countries have stronger economic growth than others revolves ar... more One of the puzzles about why some countries have stronger economic growth than others revolves around the so-called 'middle-income trap', the situation in which a country that has grown strongly gets stuck at a certain level. In this book, Keun Lee explores the reasons why examples of successful catching-up are limited and in particular, why the Asian economies, including China, have managed to move, or are moving, beyond middle-income status but economic growth has stalled in some Latin American countries. This is one of the first studies to demonstrate using patent analysis that the secret lies in innovative systems at the firm, sector and country levels which promote investment in what the author calls 'short-cycle' technologies and thereby create a new path different from that of forerunning countries. With its comprehensive policy framework for development as well as useful quantitative methods, this is essential reading for academic researchers and practitioners.
This paper measured the Total Factor Productivity (TFP) of all listed firms in Korea from 1984 to... more This paper measured the Total Factor Productivity (TFP) of all listed firms in Korea from 1984 to 2005 and compared this TFP of Korean firms with that of Japanese firms. This study used the chain-linked index number method developed by Good et al.(1999) to find that the average TFP of Korean firms grew about 44.1% between 1984 and 2005, with 2.1% annual growth rates. The catch-up index of Korean firms with Japanese firms is defined at an individual firm level for the first time among existing literature. Through this comparison ...
Page 1. 1 Globelics 2010 8 th International Conference Making Innovation Work for Society: Linkin... more Page 1. 1 Globelics 2010 8 th International Conference Making Innovation Work for Society: Linking, Leveraging and Learning 1 - 3 November 2010 University of Malaya, Kuala Lumpur, Malaysia Medical Imaging Innovative Features and Their ...
ABSTRACT This paper discusses how the evolving nature of innovation has affected the way Intellec... more ABSTRACT This paper discusses how the evolving nature of innovation has affected the way Intellectual Property Right (IPR) regime has affected economic growth in developing countries. Focusing more on utilization rather than protection of IPs for human society, it argues that the linkages from protection of knowledge to innovation incentives should be given more priority at the later stage of economic development when developing countries reach a certain level of technological capabilities. Despite the loose or open linkage between IP protection and economic growth, strong IP enforcement can still seriously decrease the catching-up probability of latecomer firms, especially small and medium-sized enterprises (SMEs). The lawsuits by patent trolls may be more damaging because cross-licensing or patent pooling strategy is not available at all as a settlement option. Thus, latecomer firms are facing heavier challenges than before, especially the SMEs with limited financial and human resources. In such circumstance, there can be a case for the active role of public policies and interventions.
Abstract: This paper has investigated institutional changes in corporate sector in Korea. The fol... more Abstract: This paper has investigated institutional changes in corporate sector in Korea. The following three areas of institutional reform have been covered by the case studies of the relevant firms: 1) workforce restructuring in labor‐management relations, 2) independent directors in corporate governance, and 3) business restructuring. It first confirms the importance of 'transparency'in corporate management and institutions as one of the most fundamental requirements of the market economy and second, the importance of how to ...
While the Korean economy had boasted a strong recovery with almost 10 per cent real growth in 199... more While the Korean economy had boasted a strong recovery with almost 10 per cent real growth in 1999, the situation in 2000 and now does not seem that bright. Now, the perception increasingly is that post-crisis restructuring, once regarded as successful, is not really satisfactory — only half the required job has been done. This chapter will look at the post-crisis changes in corporate governance and business structure in Korean firms. To evaluate post-crisis corporate restructuring in Korea, the chapter starts with examining the root of the corporate system in Korea.
This study deals with the convergence and divergence issue in terms of the possible difference in... more This study deals with the convergence and divergence issue in terms of the possible difference in the knowledge-sourcing behaviour of latecomer and incumbent firms. Consequently, empirical analysis using the patent citation data shows that no significant difference exists in the knowledge-sourcing behaviour of the incumbents and latecomers in long-cycle time-based sectors, particularly in terms of whether each type of firm relies more or less on ‘recent’ and ‘scientific’ knowledge. By contrast, a significant difference is observed in the short-cycle technology-based sectors, such that the latecomer firms tend to rely more on ‘recent’ and ‘scientific’ knowledge than the incumbents. Thus, the findings suggest that the answer to the question of whether convergence or divergence exists in knowledge sourcing is that it depends on the knowledge regime of the sectors, specifically on the cycle time of the technologies of sectors. This finding is consistent with the reasoning that the latecomer firms can afford to rely only on recent technologies in short-cycle sectors in which technologies tend to change quickly or become obsolete; latecomer firms are also keen on their knowledge sourcing to broadly search not only into technological knowledge (patents) but also into scientific knowledge (articles) in short-cycle sectors with rapid change of technologies.
This research revisits the issue of economic growth determinants in developing countries with a f... more This research revisits the issue of economic growth determinants in developing countries with a focus on international integration variables. Four alternative variables are tested, namely, export growth, trade openness, export diversification, and foreign direct investment (FDI), in a single framework. This study finds that export growth is the most robust, in addition to export specialization, and that traditional variables of trade openness and FDI are not robust. This result is based on the econometric estimations that use not only cross-section and fixed-effect panel estimations but also system generalized method of moments estimations. The findings warn against the traditional emphasis on simple trade openness and FDI as policy prescriptions for developing countries. In other words, simply opening an economy for international integration does not guarantee sustained economic growth unless these actions lead to export growth, which requires capability building in indigenous firms and investments in innovations. This observation is consistent with the experiences of successful economies in Asia, such as Korea, Taiwan, and China.
Intangibles, Market Failure and Innovation Performance, 2014
Bloom and Van Reenen (Quarterly Journal of Economics 122:1351–1408, 2007) show that differences i... more Bloom and Van Reenen (Quarterly Journal of Economics 122:1351–1408, 2007) show that differences in management practices are related to productivity differences at the firm level. In this paper we conducted a similar interview surveys on management practices in Japanese and Korean firms in 2008 and 2012. We find that overall management scores as an average of organizational and human resource management scores in Japan are higher than those in Korea. However, the second survey shows that the gap in management scores between two countries has shrunken over time. In addition, average management quality in Korean large firms has surpassed that in Japanese large firms, which are consistent with the literature comparing big businesses in Korea and Japan. This study also compares additional aspects of the management style, such as speed in decision-making and the role of various communication channels, which are not done in the previous literatures.
... Keun Lee* , Justin Y. Lin**, and Ha-Joon Chang ... This paper has benefited from the comments... more ... Keun Lee* , Justin Y. Lin**, and Ha-Joon Chang ... This paper has benefited from the comments by Chung Lee. ... One might argue that the country's export share is not particularly high compared to that of other small countries – Singapore, Hong Kong, or even Malaysia, Belgium, or ...
... owner families and the affiliate firms in 1989. There are 8 business groups belonging to the ... more ... owner families and the affiliate firms in 1989. There are 8 business groups belonging to the top 30 that we classify as non-Chaebols; Dong-ah, Dong-yang, Mi-won, Halla, Kukdong Refinery, Tongil, Hanbo, and Poongsan. In most of these cases, the owner's shares range from ...
... Table 1 presents the shares held by the owner families and the affiliate firms in 1989. There... more ... Table 1 presents the shares held by the owner families and the affiliate firms in 1989. There are 8 business groups belonging to the top 30 that we classify as non-Chaebols; Dong-ah, Dong-yang, Mi-won, Halla, Kukdong Refinery, Tongil, Hanbo, and Poongsan. ...
Abstract A large body of qualitative studies on the positive role played by big businesses in pro... more Abstract A large body of qualitative studies on the positive role played by big businesses in promoting economic growth is widely available. However, any rigorous attempt to measure this impact has yet to be made. In this paper, we attempt to fill this gap by utilizing new and internationally comparable databases such as those of the Global Fortune 500, the Business Week 1000, and the Forbes 2000 publications, and by using rigorous quantitative methods. We measure big businesses by both the number of these firms and by their sales volumes ...
This paper takes a new Schumpeterian economics approach in examining firm-level technological cat... more This paper takes a new Schumpeterian economics approach in examining firm-level technological catch-up strategies in China. We focus on the strategies for learning and gaining access to a foreign knowledge base. We also underline unique Chinese features, including forward engineering (ie the role of university spin-off firms) in contrast to reverse engineering, acquisition of technology and brands through international mergers and acquisitions (M&A), and parallel learning from foreign direct investment (FDI) to promote ...
One of the puzzles about why some countries have stronger economic growth than others revolves ar... more One of the puzzles about why some countries have stronger economic growth than others revolves around the so-called 'middle-income trap', the situation in which a country that has grown strongly gets stuck at a certain level. In this book, Keun Lee explores the reasons why examples of successful catching-up are limited and in particular, why the Asian economies, including China, have managed to move, or are moving, beyond middle-income status but economic growth has stalled in some Latin American countries. This is one of the first studies to demonstrate using patent analysis that the secret lies in innovative systems at the firm, sector and country levels which promote investment in what the author calls 'short-cycle' technologies and thereby create a new path different from that of forerunning countries. With its comprehensive policy framework for development as well as useful quantitative methods, this is essential reading for academic researchers and practitioners.
This paper measured the Total Factor Productivity (TFP) of all listed firms in Korea from 1984 to... more This paper measured the Total Factor Productivity (TFP) of all listed firms in Korea from 1984 to 2005 and compared this TFP of Korean firms with that of Japanese firms. This study used the chain-linked index number method developed by Good et al.(1999) to find that the average TFP of Korean firms grew about 44.1% between 1984 and 2005, with 2.1% annual growth rates. The catch-up index of Korean firms with Japanese firms is defined at an individual firm level for the first time among existing literature. Through this comparison ...
Page 1. 1 Globelics 2010 8 th International Conference Making Innovation Work for Society: Linkin... more Page 1. 1 Globelics 2010 8 th International Conference Making Innovation Work for Society: Linking, Leveraging and Learning 1 - 3 November 2010 University of Malaya, Kuala Lumpur, Malaysia Medical Imaging Innovative Features and Their ...
ABSTRACT This paper discusses how the evolving nature of innovation has affected the way Intellec... more ABSTRACT This paper discusses how the evolving nature of innovation has affected the way Intellectual Property Right (IPR) regime has affected economic growth in developing countries. Focusing more on utilization rather than protection of IPs for human society, it argues that the linkages from protection of knowledge to innovation incentives should be given more priority at the later stage of economic development when developing countries reach a certain level of technological capabilities. Despite the loose or open linkage between IP protection and economic growth, strong IP enforcement can still seriously decrease the catching-up probability of latecomer firms, especially small and medium-sized enterprises (SMEs). The lawsuits by patent trolls may be more damaging because cross-licensing or patent pooling strategy is not available at all as a settlement option. Thus, latecomer firms are facing heavier challenges than before, especially the SMEs with limited financial and human resources. In such circumstance, there can be a case for the active role of public policies and interventions.
Abstract: This paper has investigated institutional changes in corporate sector in Korea. The fol... more Abstract: This paper has investigated institutional changes in corporate sector in Korea. The following three areas of institutional reform have been covered by the case studies of the relevant firms: 1) workforce restructuring in labor‐management relations, 2) independent directors in corporate governance, and 3) business restructuring. It first confirms the importance of 'transparency'in corporate management and institutions as one of the most fundamental requirements of the market economy and second, the importance of how to ...
While the Korean economy had boasted a strong recovery with almost 10 per cent real growth in 199... more While the Korean economy had boasted a strong recovery with almost 10 per cent real growth in 1999, the situation in 2000 and now does not seem that bright. Now, the perception increasingly is that post-crisis restructuring, once regarded as successful, is not really satisfactory — only half the required job has been done. This chapter will look at the post-crisis changes in corporate governance and business structure in Korean firms. To evaluate post-crisis corporate restructuring in Korea, the chapter starts with examining the root of the corporate system in Korea.
This study deals with the convergence and divergence issue in terms of the possible difference in... more This study deals with the convergence and divergence issue in terms of the possible difference in the knowledge-sourcing behaviour of latecomer and incumbent firms. Consequently, empirical analysis using the patent citation data shows that no significant difference exists in the knowledge-sourcing behaviour of the incumbents and latecomers in long-cycle time-based sectors, particularly in terms of whether each type of firm relies more or less on ‘recent’ and ‘scientific’ knowledge. By contrast, a significant difference is observed in the short-cycle technology-based sectors, such that the latecomer firms tend to rely more on ‘recent’ and ‘scientific’ knowledge than the incumbents. Thus, the findings suggest that the answer to the question of whether convergence or divergence exists in knowledge sourcing is that it depends on the knowledge regime of the sectors, specifically on the cycle time of the technologies of sectors. This finding is consistent with the reasoning that the latecomer firms can afford to rely only on recent technologies in short-cycle sectors in which technologies tend to change quickly or become obsolete; latecomer firms are also keen on their knowledge sourcing to broadly search not only into technological knowledge (patents) but also into scientific knowledge (articles) in short-cycle sectors with rapid change of technologies.
This research revisits the issue of economic growth determinants in developing countries with a f... more This research revisits the issue of economic growth determinants in developing countries with a focus on international integration variables. Four alternative variables are tested, namely, export growth, trade openness, export diversification, and foreign direct investment (FDI), in a single framework. This study finds that export growth is the most robust, in addition to export specialization, and that traditional variables of trade openness and FDI are not robust. This result is based on the econometric estimations that use not only cross-section and fixed-effect panel estimations but also system generalized method of moments estimations. The findings warn against the traditional emphasis on simple trade openness and FDI as policy prescriptions for developing countries. In other words, simply opening an economy for international integration does not guarantee sustained economic growth unless these actions lead to export growth, which requires capability building in indigenous firms and investments in innovations. This observation is consistent with the experiences of successful economies in Asia, such as Korea, Taiwan, and China.
Intangibles, Market Failure and Innovation Performance, 2014
Bloom and Van Reenen (Quarterly Journal of Economics 122:1351–1408, 2007) show that differences i... more Bloom and Van Reenen (Quarterly Journal of Economics 122:1351–1408, 2007) show that differences in management practices are related to productivity differences at the firm level. In this paper we conducted a similar interview surveys on management practices in Japanese and Korean firms in 2008 and 2012. We find that overall management scores as an average of organizational and human resource management scores in Japan are higher than those in Korea. However, the second survey shows that the gap in management scores between two countries has shrunken over time. In addition, average management quality in Korean large firms has surpassed that in Japanese large firms, which are consistent with the literature comparing big businesses in Korea and Japan. This study also compares additional aspects of the management style, such as speed in decision-making and the role of various communication channels, which are not done in the previous literatures.
... Keun Lee* , Justin Y. Lin**, and Ha-Joon Chang ... This paper has benefited from the comments... more ... Keun Lee* , Justin Y. Lin**, and Ha-Joon Chang ... This paper has benefited from the comments by Chung Lee. ... One might argue that the country's export share is not particularly high compared to that of other small countries – Singapore, Hong Kong, or even Malaysia, Belgium, or ...
... owner families and the affiliate firms in 1989. There are 8 business groups belonging to the ... more ... owner families and the affiliate firms in 1989. There are 8 business groups belonging to the top 30 that we classify as non-Chaebols; Dong-ah, Dong-yang, Mi-won, Halla, Kukdong Refinery, Tongil, Hanbo, and Poongsan. In most of these cases, the owner's shares range from ...
... Table 1 presents the shares held by the owner families and the affiliate firms in 1989. There... more ... Table 1 presents the shares held by the owner families and the affiliate firms in 1989. There are 8 business groups belonging to the top 30 that we classify as non-Chaebols; Dong-ah, Dong-yang, Mi-won, Halla, Kukdong Refinery, Tongil, Hanbo, and Poongsan. ...
Abstract A large body of qualitative studies on the positive role played by big businesses in pro... more Abstract A large body of qualitative studies on the positive role played by big businesses in promoting economic growth is widely available. However, any rigorous attempt to measure this impact has yet to be made. In this paper, we attempt to fill this gap by utilizing new and internationally comparable databases such as those of the Global Fortune 500, the Business Week 1000, and the Forbes 2000 publications, and by using rigorous quantitative methods. We measure big businesses by both the number of these firms and by their sales volumes ...
This paper takes a new Schumpeterian economics approach in examining firm-level technological cat... more This paper takes a new Schumpeterian economics approach in examining firm-level technological catch-up strategies in China. We focus on the strategies for learning and gaining access to a foreign knowledge base. We also underline unique Chinese features, including forward engineering (ie the role of university spin-off firms) in contrast to reverse engineering, acquisition of technology and brands through international mergers and acquisitions (M&A), and parallel learning from foreign direct investment (FDI) to promote ...
Bloom and Van Reenen (Quarterly Journal of Economics 122:1351-1408, 2007) show that differences i... more Bloom and Van Reenen (Quarterly Journal of Economics 122:1351-1408, 2007) show that differences in management practices are related to productivity differences at the firm level. In this paper we conducted a similar interview surveys on management practices in Japanese and Korean firms in 2008 and 2012. We find that overall management scores as an average of organizational and human resource management scores in Japan are higher than those in Korea. However, the second survey shows that the gap in management scores between two countries has shrunken over time. In addition, average management quality in Korean large firms has surpassed that in Japanese large firms, which are consistent with the literature comparing big businesses in Korea and Japan. This study also compares additional aspects of the management style, such as speed in decision-making and the role of various communication channels, which are not done in the previous literatures.
Today, a large number of scholars studying development understand this process as involving learn... more Today, a large number of scholars studying development understand this process as involving learning and capability building. Capability building is an active, not a passive, process. It requires a purposeful effort from the learner’s side, with support and commitment on allocation of time and resources toward learning activities. This process implies the possibility of failure as well as success, as we also learn from failures. A global cast of academics and policy makers examines economic development as a process of learning and technological accumulation, showing how economic development is a process involving creative destruction. While markets and market competition play major roles in structuring the development process, non-market institutions and government policies matter.
One of the puzzles about why some countries have stronger economic growth than others revolves ar... more One of the puzzles about why some countries have stronger economic growth than others revolves around the so-called 'middle-income trap', the situation in which a country that has grown strongly gets stuck at a certain level. in this book, Keun Lee explores the reasons why examples of successful catching-up are limited and in particular, why the Asian economies, including China, have managed to move, or are moving, beyond middle-income status but economic growth has stalled in some Latin American countries. This is one of the first studies to demonstrate using patent analysis that the secret lies in innovative systems at the firm, sector and country levels which promote investment in what the author calls 'short-cycle' technologies and thereby create a new path different from that of forerunning countries. With its comprehensive policy framework for development as well as useful quantitative methods, this is essential reading for academic researchers and practitioners.
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