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Moving Up the Value Chain: Staying Competitive in the Global Economy

Korea’s experience also illustrates how good crisis management can accelerate structural adjustment. The Asian financial crisis of the late 1990s led to significant down-sizing among large firms in Korea. This process was characterized by mass lay-offs of highly-skilled personnel, and large reductions in corporate R&D spending. The response of the Korean government, in addition to boosting education expenditure, was to increase its R&D budget, to offset the decline in corporate R&D spending. Moreover, it used the crisis as an opportunity to develop a technology-based SME sector, using the Special Law to Promote Venture Firms (enacted in 1998). A co-ordinated. | Moving Up the Value Chain Staying Competitive in the Global Economy MAIN FINDINGS OECD MOVING UP THE VALUE CHAIN STAYING COMPETITIVE IN THE GLOBAL ECONOMY - 3 Foreword Globalisation raises many important challenges and is high on the policy agenda in many OECD countries. At the 2004 Ministerial Council Meeting Ministers asked the OECD to shed light on issues related to the increased outsourcing and offshoring of production since solid evidence to underpin policy discussion and formulation was scarce. To help implement this mandate the OECD Council decided at the end of 2004 on an allocation of the OECD s Central Priority Fund for a study including a systematic empirical overview of trends and developments on the globalisation of value chains. The Committee on Industry Innovation and Entrepreneurship CIIE provided guidance on the scope of this study. This document presented to the OECD s 2007 Ministerial Council meeting brings together some of the evidence on the globalisation of value chains and identifies the most relevant policy issues in order to address concerns related to globalisation. A compendium of the individual studies underlying this summary will be finalised later this year. OECD .