Mei-Chih Hu

Fast-Follower Industrial Dynamics: The Case of Taiwan's Emergent Solar Photovoltaic Industry

The world is on the cusp of major transformations of energy systems, with solar photovoltaic (PV) systems providing one of the most promising alternatives to fossil fuels. Amongst the countries moving to take advantage of the new production possibilities thus being opened up is Taiwan, employing in this new sector its characteristic strategies of fast followership that it has perfected in earlier industrial shifts involving semiconductors, ICT products and flat panel displays. This paper provides an interim assessment of Taiwans early entry strategies, involving a focus on mainstream crystalline silicon solar cells, as well as entry into emerging niche sectors such as thin-film second-generation cells and concentrated solar cells utilizing novel semiconductor materials. Taiwan firms’ fast-follower strategies are highlighted and assessed in light of the literature on industrial dynamics and catch-up processes generally. The paper makes a contribution to theory in building nine propositions regarding fast followership, based on prior industrial experiences and this latest episode in the solar PV industry. Taiwans strategies as a model for China are discussed, while the paper proposes Taiwan as an alternative to the “closed” and “open” models of photovoltaic diffusion identified for Japan and the USA.

Evolution of knowledge creation and diffusion: the revisit of Taiwan's Hsinchu Science Park

The Hsinchu Science Park in Taiwan has been synonymous with dynamic and flourishing high-tech industries and companies since the 1980s. Using patent citation data, this empirical study shows that Taiwan’s Hsinchu Science Park is a healthy and knowledge-based cluster surrounded by the semiconductor sector, in which external knowledge is continuously playing an important role, while internalized capability is building up quickly; new and extended industrial clusters are being established by the growth of new ventures; and the linkages of capital, manpower, and technology flows are conducted respectively by the large business groups, the NTHU and NCTU, and the ITRI in the region. Subsequent sectors, repeating the successful model created by and catalyzed from the semiconductor sector are flourishing; the thin-film transistor-liquid crystal display (TFT-LCD) and integrated circuit (IC) design sectors have been growing rapidly since the beginning of the 2000s, and the solar photovoltaic and LED (Light-Emitting Diode) sectors emerged quickly in mid-2005. The continuous evolving and growing industries along with the significant increase of value added in the Hsinchu Science Park have demonstrated it is acting as a healthy and vivid innovation region. The policy implications derived from this study can thus shed light, for the Southeast Asian, Latin American or other latecomers, on the strategies for formulating regional research and innovation policies in the process of developing a knowledge-based economy.

The dynamic effect of knowledge capitals in the public research institute: insights from patenting analysis of ITRI (Taiwan) and ETRI (Korea)

This study aims what knowledge capital accumulated by the public research institutes (PRIs) of South Korea and Taiwan to facilitate process configurations of new industrial structure. The patenting trends of two PRIs, ETRI of South Korea and ITRI of Taiwan, are assessed to highlight the established knowledge structures for emergence of multi-agent structure since 1990s. To examine their dynamics and variations of knowledge capital, the data series are separated into two phases (catching-up phase from 1970s to 1990s, and post catching-up phase since the 2000s) in accordance to (1) number of patents, (2) number of sole owned and co-owned patents, (3) backward and forward citations, (4) science-linked patents, and (5) fields of patent. When the role of PRIs in the latecomer country is evolving from a facilitator in the catching-up phase to become a mediator in the post catching-up phase, this study demonstrated their influence and dynamic effect in reinforcing industrial strategies and national approaches to attain endogenous structural change in the national innovation system. Our results signal telecommunications is the promising technology targeted by Korea’s chaebols while Taiwan’s small-medium size enterprises are utilizing the aggregate knowledge capital accumulated and derived from semiconductor technologies to develop their niches onto a diverse range of product innovations.

Strategic entrepreneurship and the growth of the firm: the case of Taiwan's bicycle industry

Taking advantage of the modular product architecture in the global bicycle industry, Taiwan has created a unique industry organisation that has allowed the island to become a bicycle production powerhouse. We stipulate four characteristics of Taiwans bicycle industry for this success: parallel networking, abundant entrepreneurial firms, supportive government and close ties with the USA and Japan. In the case study of Giant Bicycle Corporation, we integrate the entrepreneurship perspective with strategic management to explain the wealth creation and the growth of the firm. With strategies on internal organisation reengineering and global deployment, Giant has been able to build up its sustainable competitive advantages. We conclude that entrepreneurship is the key element for the growth of the firm and even a labour-intensive or non-high-technology industry can be selected as a development strategy.

Estimating the innovation effects of university–industry–government linkages: The case of Taiwan

This study focuses on university—industry—government (UIG) linkages and their influence on innovation in Taiwan. The innovation effects are estimated using a quartet of measures — technology transfers, technology licensing, firms incubated and patents granted — while the UIG influence is estimated via its differential impact according to the size of the firms involved, the type of innovation (process or product-oriented), the stage of the technology cycle, and the role of government. Using a Structural Equation Model (SEM) method to examine these interactions, the study reveals that UIG linkage effects vary with the size of company, in that the major incentive for UIG linkages for large companies is an attempt to acquire a skilled and qualified workforce, while SMEs (small and medium enterprises) tend to use them to gain marketing advantage, particularly for those SMEs or start-ups in emerging industries. The study concludes that Taiwans innovation capacity is heavily reliant on building the capability of SMEs and continues to depend greatly on government leadership through technology-capability-enhancing institutions such as ITRI.

Collaboration between Public Research Institutes and Universities: A Study of Industrial Technology Research Institute, Taiwan:

This study examines the linkages between Taiwan’s Industrial Technology Research Institute (ITRI) and universities. It employs the government–university (G–U) relation of triple helix framework to assess collaboration patterns between ITRI and the top universities of Taiwan over two phases of economic development, that is, the catching-up phase in the 1990s and the subsequent post catching-up phase over the 2000s. We highlight the collaborative dynamics in terms of ITRI’s (a) (co-) evolving knowledge capital, (b) strategic collaboration mode, (c) co-publication in scientific papers, (d) co-owned patents, (e) forward and backward citations and (f) science-based patents. Our systematic review of the role of ITRI in both catching-up and post catching-up phases will provide a useful guide for policy makers in other economies (such as Malaysia and Hong Kong) that aspire to define a similar role for their public research institutions.

Exploring technological innovation trajectories through latecomers: evidence from Taiwan's bicycle industry

By examining the technological innovation trajectories of Taiwans bicycle industry over the last 30 years, this paper identifies three specific periods that constitute industry cycles with peaks occurring in 1980, 1990 and 2002. In each period, innovation capabilities within the six bicycle subsystems shifted, accompanied by variations in the needs of international markets and in export performance. The empirical results demonstrate that innovation activity in the production of key components by technological latecomers increases only when that of the market leaders is in decline. It is also demonstrated that through incremental technological innovations, taking advantage of modularity and appropriate strategic organisational innovations, such latecomers can become and remain competitive in the international market. By providing an understanding of the sequences that make up modularised technological trajectories and of the cycles experienced by the global bicycle market, this study is able to elicit some practical insights into the policy and managerial implications for latecomers involved in technological innovation.

Concentrating solar power: a renewable energy frontier

Renewable energies are advancing across many fronts – and now a new front has opened up in the form of dispatchable concentrating solar power (CSP). It is in emerging markets such as China, India and countries in North Africa and the Middle East as well as South America and southern Africa that CSP power plants with 24/7 dispatchable power are starting to be viewed as a viable way forward. The emerging CSP industrial value chain in China, India, southern Africa and elsewhere is expected to exert its consequent dramatic impact on cost reductions, which will in turn drive the diffusion of CSP around the world as a key challenger and alternative to nuclear and fossil fuel power. In this paper, we review these developments and discuss the effects attributable to the emerging learning curve, combined with technology progress involving molten salt heat transfer and reductions in water requirements, as well as patenting trends in the global CSP industry.

Information Technology Services: A Key Knowledge-Intensive Business Service Industry in Hong Kong SAR, China:

As the global economy focuses increasingly on Asia, Hong Kong’s role as an intermediary between China and the rest of the world merits investigation. In view of the increasing importance of knowledge-based business services and Hong Kong’s recent drive to promote innovation and high-tech services, economists and policy makers must understand Hong Kong’s capacity to support economic development in the Asian region. Following a theoretically informed discussion of the role of information technology (IT) services within the broader category of knowledge-intensive business services (KIBS), Hong Kong’s IT services sector is described and analysed to determine its potential for supporting an innovative local services environment and to identify the key opportunities and challenges involved in further developing the sector. In-depth interviews of important actors in the IT services sector in Hong Kong and case studies of firms that have leveraged IT services supplement our analysis of data on IT service production and usage. IT services represents an opportunity through which Hong Kong can use targeted policy to drive growth and expand and deepen economic relations with Mainland China.

Moving to a Circular Economy in China: Transforming Industrial Parks into Eco-industrial Parks:

China’s moves to introduce a Circular Economy have attracted wide attention as a solution to severe problems of resource inefficiency and lack of resource productivity. This article highlights the distinctive strategy of focusing such efforts on existing industrial parks, turning them into eco-industrial parks. It provides three case studies and highlights the management issues involved as overcoming reverse salients and capturing network advantages. China is an especially instructive case because it starts well behind the Organisation for Economic Co-operation and Development (OECD) countries and thereby has much to gain by adopting comprehensive policies.