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This study conducts an analysis that find out the regional economic convergence phenomenon among 16 domestic regions by using absolute and conditional convergence model. Especially for the conditional convergence model, telecommunication CAPEX(Capital expenditure) has divided into various types. The data used in this research is unbalanced, depending on the period of each statistical data from 16 domestic regions, but formed a panel data using statistical data from 1995 to 2012 in general. In addition, this research analyzes the absolute and conditional convergence phenomenon through random effect model. To begin with, the conditional convergence model in the research has progressed with the objective of searching out the effect of physical capital, human capital, and telecommunication CAPEX on the convergence of regional economic through Barro(1989)’s empirical model. Besides, in order to understand a various relationship between telecommunication CAPEX and regional economic growth, telecommunication CAPEX consists of two types(wire, wireless) and technologies(3th generation, 4th generation). As a result, this research shows a fact that the absolute and conditional convergence phenomenon of regional economic growth exists among 16 domestic areas. Secondly, in case of telecommunication CAPEX, wireless(1.4%) CAPEX of the convergence rate is faster than wire(0.2%) CAPEX. Also, the convergence rate applied for periods of 4th Generation(1%) wireless telecommunications CAPEX is faster than 3th Generation(0.5%). Thirdly, in the analysis of determination factor, telecommunication CAPEX, irrespective of wire or wireless, has positive impact on regional economic growth by helping a capital accumulation in region. However, since wireless CAPEX has a negative relationship associated with average rate of regional economic growth, better planned telecommunication policy for regional economic growth is needed. Meanwhile, this research has a limitation that cannot compose a perfect telecommunication CAPEX stock by using telecommunication and facilities construction data. Nevertheless, this research enable us to not only understand the relationship between telecommunication CAPEX and regional economic growth, but also provides fundamental data for a telecommunication policy.

As global competition is increasing and enterprise environment is rapidly changing in the aftermath of the development of information and communications, many companies have recognized the necessity to sustain innovation. To enable such innovation activities, many companies are trying to utilize startups' entrepreneurial culture in order to quickly adjust to the changes and enter new markets. 'Entrepreneurial orientation' is recognized as a decision making strategy of entrepreneurship in existing companies. Many prior studies have proven that entrepreneurial orientation has positive influence on companies' performance. Based on the 5 dimensions of entrepreneurial orientation (innovativeness, risk-taking, proactiveness, competitive aggressiveness, autonomy), this study aims to examine how their influence on companies' performance changes in accordance with the change in the flow of 'knowledge', knowledge creation process and open innovation, taking as moderating variables. Knowledge creation process, a circulation of new knowledge in a organization, is composed of 'socialization', 'externalization', 'internalization' and 'combination'. Open innovation is a paradigm in which firms should use external ideas and resources to innovate with partners by sharing risk and rewards. Using survey data from Korean small and medium enterprises(SMEs), the result of our analysis is as follows. First, entrepreneurial orientation influenced companies' performance positively as previous studies have shown. In terms of subordinate dimensions, innovativeness and proactiveness proved to be positively related to companies' performance. Second, knowledge creation process had beneficial influence on proactiveness. Third, open innovation had a positive moderating effect on proactiveness and a negative one on innovativeness. The results of our study show that entrepreneurial orientation dimensions can change independently and that companies wishing to improve their performance through strengthening entrepreneurial orientation can gain understanding on what they need to focus on. Except for proactiveness, knowledge creation process proved not to be statistically a significant moderating factor. That means that the role of knowledge in Korean firms are still limited and most of Korean SMEs are focusing on short term innovation activities such as cost saving, growing productivity, etc. In case of open innovation, previous study has shown that active innovative activities with external resources negatively influence the internal innovative activities in an organization, Therefore two kinds of innovative activities can be inconsistent with each other in the firms that has limited resource. On the other hand, as proactiveness has a strong relationship on entering new markets and searching new opportunities, it appears that it needs to use external resource and ideas for doing that effectively. We were able to confirm that proactive enterprises wishing to catch new opportunities and advance into new market need to create and share knowledge internally, and to cooperate with external sources in order to improve performance.

Incheon International Airport is a gateway to Korea since its opening in 2001. Incheon international airport has posted significant growth in various indices. Passenger and cargo traffic at Incheon International Airport show upward trend since its opening. As well as Incheon International Airport has posted significant growth in various indices maintaining its outstanding status as a hub airport in Northeast Asia, a share of non-aero revenue shows increasing trend since 2007. Revenue which is the most frequent output measure of airport can be divided into aero and non-aero revenues. The objective of this study is to analyze whether there is improvement of operational efficiency and to determine the factors affecting operational efficiency of Incheon International Airport using Technique of Order Preference by Similarity to Ideal Solution method Since Data Envelopment Analysis which is frequently used to analyze effectiveness of infrastructure such as ports and airport gives only absolute measures and distance from the frontier so that it is not easy to measure how good the value relatively is. Revenue and costs are used as performance data for empirical analysis. It is found that there is self-improvement of Incheon International Airport because Korean government stops subsidy to Incheon Airport from 2008. It is found that there is improvement in operational efficiency of Incheon International Airport since its opening 2001. It looks as if there is improvement in aeronautical operation of Incheon International Airport. Also increases in non-aero revenue stimulate total revenue of the airport. However, there is no distinct evidence that there is improvement of operational efficiency of Incheon International Airport in terms of aero-revenue. Finally, it is found that Incheon international airport focuses on effectiveness by expanding business boundary rather than efficiency by increasing internal competitiveness. It is known that major airports in the world including Incheon International Airport try to reduce fees from airline company, cargo company, and passenger to increase traffic volume and competitiveness since there are fierce competition in airport industry, especially in Asia. This may be the reason why aero revenue does not contribute improvement of operational efficiency of Incheon International airport.

This study selected 38 Korean pharmaceutical firms listed on the KOSPI and KOSDAQ and attempted to evaluate their management efficiency on the last five years of data from 2007 to 2011. In order to utilize DEA(Data Envelopment Analysis) model, this study used output data such as net profit, operating profit, and gross sales and input variables such as sales management expenses, R&D cost, labor cost, and total assets. A Malmquist model, a measurement method of productivity, was used to evaluate the dynamic change of the management efficiency of five years. Because an efficiency analysis preceded drawing a Malmquist Productivity Index(MPI) for analyzing productivity, the current research is comprised of both efficiency and productivity analysis. The result analyzed by a DEA technique showed that domestic pharmaceutical firms increased their efficiency and productivity through internal management innovation, maintaining efficient size relatively. Although domestic pharmaceutical firms’ productivity is affected more by technological changes than by efficiency changes, efficiency changes in individual pharmaceutical firms are not affected by technological changes. Thus, individual pharmaceutical firms stick to short-term efficiency. Accordingly, because investment expansion of R&D and facilities for improving long-term productivity rather increases input by decreasing efficiency, it is for individual pharmaceutical firms to perform this strategy.

This paper analyzes mutual spillover effects between stock and bond markets of Korea and US, using the multivariate GARCH-BEKK (generalized autoregressive conditional heteroscedasticity - Baba, Engle, Kraft, and Kroner) framework without any prior restrictions on conditional correlations among time-varying volatilities of these four market returns. The whole sample period consists of 3,914 days from December, 1997 to December, 2012. In particular, the Global Financial Crisis Period of July, 2008 to June is additionally chosen in this analysis. In particular, separate multivariate asymmetric GARCH model by GJR(Glosten, Jaganathan, and Runkle) is used to check further asymmetric volatility transmission effect in the unexpected up-market shock and the unexpected down-market shock. Additionally, global common factors such as difference of T-Bill rate and change of VIX(US S&P 500 volatility index) and country-specific factors such as change of foreign exchange rate are set up as explanatory variables in the mean equations of the above-mentioned GARCH model to differentiate their own special shock factors of these two stock and bond markets. Major findings in this analysis are as follows. First, shock spillovers from the unexpected change of returns in these two stock markets are generally more active than those in the bond markets, regardless of model forms of symmetric or asymmetric GARCH-BEKK. Second, shock spillovers from US to Korea are generally stronger than those from Korea to US in both of the total sample period and the Global Financial Crisis times. Third, stock market shock spillovers are more active in the Global Financial Crisis times than in the total sample period. Fourth, particularly in the bond market, some positive shock spillovers, although not significant, from Korea to US is found to exist in the Global Financial Crisis times. With all these four findings above, Korean stock market is found to be fragile to the outside shocks. Therefore, some policy designs need to begin with mitigating shock spillovers from outside in the Korean stock market.

Sensors combine highly sophisticated technology and micro-fabrication technologies such as integrated semiconductor technologies and MEMS(integrated Micro-Electro-Mechanical Systems). They have evolved into ‘Smart sensors’ which are embedded with data processing, automatic calibration, self-diagnostics and decision-making abilities. Smart sensors have attracted great attention, emerging as the core technology of the IT Convergence and the IoT(Internet of Things) era. The world's sensor market is among the fasted growing markets. Nevertheless, the Korean sensor industry is in a vulnerable situation, lacking international competitiveness both in technology and price. This research analyzes and evaluates national competitiveness of the Korean sensor industry using Porter’s Diamond Model. The model focuses on the following four aspects; factor conditions, demand conditions, related and supporting industries and firm strategy/structure/rivalry. Given the research context, factor conditions regard patents and technology while demand conditions address markets and consumers. Related and supporting industries concern the nano industry and semiconductor industry. Lastly strategy/structure/rivalry deals with market share and rate of operating profits. The Korean sensor industry’s international competitiveness has been reported as 20.45, and ranks third among the three countries(USA : 100, Japan : 63.07). According the four aspects, in terms of factor conditions, the Korean sensor industry holds relatively abundant equipment, infrastructure and R&D. However the lack of efficient connection and utilization of such factor condition puts it at a competitive disadvantage. Second, in terms of demand conditions, the environment itself if quite favorable for Korean sensor companies. Nonetheless actual consumers prefer to use imported sensors due to lack of reliability and compatibility. Hence, as demand for sensors increase, the greater the trade deficit. Third, in terms of the support industries, the Korean nano industry has fallen behind compared to the number and quality of US or Japanese patents and technologies. The semiconductor industry on the other hand has a quite a high status in the world market, making Korea second in terms of market share. Fanally, in terms of corporate strategy-structure-competition, Korea is stuck in the middle competing with the advanced country’s technologies and the developing country’s cheap prices.

This study empirically examines the moderating effect of HR department’s role between labor union’s involvement on organizational outcomes by classifying union’s participation forms into three categories such as Strategical Decisions, HR Practices, and Respecting Union’s opinion on these issues, especially from employer’s perspective. Because there were little concerns about the moderating effect of HR department’s role on the relationship between participation programs and organizational performance, and also showed little consistency in the results. To examine the hypotheses of this study, we use the 428 data of “Workplace Panel Survey(WPS)” conducted by Korea Labour Institute in 2009 for the samples of independent variables of union’s involvement on organizational outcomes, and 2011 WPS data for the dependent variables of financial performance as well as labor costs, for clarifying causality. The result shows that union’s participation positively influences on financial performance while negatively influences on labor costs. Strategic decisions influence financial performance while HR role’s moderating effects on the relationship between labor union’s involvement on organizational outcomes are supported partially. As we didn’t separate HR role into two parts such as change leading and strategic role, HR role’s moderating effects on the relationship between labor costs show inconsistent. This is due to using archival data of WPS. Further researches can follow up this issue by categorizing HR according to more specific roles.

The vast change of business environment in recent times requires a strong need to enhance accounting consistency and quality throughout the world. To meet this demand Korea has adopted IFRS(International Financial Reporting Standards) for all listed public companies from the year 2011. However, the effects of application of IFRS on financial reporting quality has been inconsistent. Further, since IFRS emphasizes economic substance and accounting principles, it has been considered that the application of IFRS will have different impact in different industries. The purpose of this study is to evaluate the effect of IFRS application on the quality of accounting information in different industries. This study examine the quality of accounting information in different industries for KSE(Korean Stock Exchange) listed companies during years from 2007 to 2013(three years before adoption of IFRS in 2011 and three years since IFRS adoption). Using discretionary accruals calculated with modified Jones model, this study examine by industries the difference between actual and tentative earnings and the prediction error of current accruals. This study documents that after IFRS adoption the quality of accounting information improved in general. Analysis of discretionary accruals by industries shows that accounting quality is higher in production industry. Discretionary accruals is lower in advanced technology industries, implying accounting quality in those industries is higher. Also, this paper provides an evidence that manufacturing industries exhibits higher accounting quality, whereas cultural industry(ind-16) appears to have poor accounting quality. After IFRS adoption, companies in the similar categories of industries appears to use similar accounting procedures. These findings suggest that to increase the comparability of accounting information it is demanding to establish category-oriented accounting principles and practices which can reflect the economic substances of the each business category.

The global climate change, mainly due to emissions of greenhouse gases from fossil fuel use and forest destruction, may become one of the most serious environmental problems. The impacts of a rapid climate change have been discussed by researchers who are physical, biological, environmental scientists, and economists for over the decades. Especially, the carbon dioxide released by humans into the atmosphere dissolves into oceans. In this paper, we measured both economic valuation and optimal production scale per hectare for grow-out phase production of the tidal flat oyster industry, considering ocean acidification. Increased ocean acidification by climate change had a bad influence for oyster production and economic feasibility in each scenario. In the case of production units, the total output of oyster decreased. Cost-benefit analysis used to indicate the effects of economic valuation. The fundamental role of Cost-benefit analysis is to establish principles by which the costs and benefits of any public project are measured. Using discounting rates 5.5%, the model compared profit that occur at different times from 2012 to 2100. This study also estimated various sub-models, which are Benefit Cost Ratio(BCR), Net Present Value(NPV), Incremental Benefit Cost Ratio(IBCR) to compare profit of grow-out phase and analyzed returns to evaluate the scenarios. The results suggest as follows. First, all of scenario analysis with sub-models were economically feasible. Second, scenario 2 which is the oyster spat to the shell height of less than 3cm in 5cm was more profit than the scenario 1(less than 1cm in 3cm) and 3(5-7cm). It is the optimal production scale of aquaculture industry. Third, the elevated ocean acidification by climate change had a bad influence for oyster production and economic feasibility. To summarise, the economic effect per hectare of ocean acidification did the damage to the economic loss from 0.97billion won to 1.23billion won. If we can collect more biological and environmental data on climate change impacts for oyster, we can expect that this research will be helpful for future investigation of the economic valuation dynamics in Korea.

An internet banking has attracted a variety of customers by providing service without restrain in time, place, space through web site, moreover affecting the reduction of transaction costs with fewer staff, leading to fundamental change in patterns on how banks do business and how customers use the banks. The number of currently registered customers are 95,490,000 (including mobile banking) at the end of 2013 and the portion of internet banking which is crucial to non-human counterpart has been constantly increased up to 34.1% out of the entire transaction on banks, thus being paid much attention to the marketing through Internet banking as long as internet banking is now established by itself as a core channel. Even though the expansion of internet banking accomplished a strategic value of cost reduction, it is facing a problem of not securing the profit model while being responsible for more than half of bank distribution channel. As the internet banking has already entered into a matured stage, it is right time to find out the factors which are positively associated with marketing outcome through the empirical analysis of expanded marketing of internet banking. In this regard, this study was to empirically analyze how the degree of customer participation in internet banking with interactive characteristic affected cross-buying intentions through mediating effect of service quality and customer satisfaction. The result showed that customer participation positively impacted on cross-buying intentions. The result showed that customer participation and customer satisfaction positively impacted on cross-buying intentions. The result was in parallel with preceding researches. Therefore, we found that enhancing service quality of internet banking can lead to customer satisfaction and increase in cross-buying intentions through customer participation which is emerged as an important factor under matured stage of digital circumstance. This study has significance in terms of presenting the concept of customer participation and cross-buying intentions for the first time in internet banking. Also, this study is able to help find out core clues about the revenue model of internet banking which is placed as an important distribution channel. Besides, this will significantly contribute to profitability enhancement of the domestic banks in case cross-buying in internet banking is carried out.

The objective of this study is to analyze the determinants of sourcing strategies of foreign invested enterprises (FIEs, hereafter) in Korea. We first find that the FIEs in Korea either engage mainly in insourcing (from their parent firms) or domestic outsourcing (from the host country). The sourcing pattern of FIEs reflects the motivation of FDI and influence knowledge spillover at the same time. Therefore, it is important to analyze the souring patterns as well as the determinants of sourcing patterns. In order to analyze the determinants of sourcing strategies of FIEs, we obtain the data from ‘2012-2013 Foreign Invested Enterprises Business Research.’ Our data sources are based on the two-year period from 2011 to 2012. To control heterogeneity, this paper restricts to manufacturing firm level data and utilizes 558 firm level samples. This paper employs a bivariate choice logistic model to investigate the determinants of sourcing strategies via firm-level. To do so, we label each firm via its trade mode as either incourcing or outsourcing type based on the examination of firm level data. To label each firm's type, we specifically consider the purchase proportion of each FIE in Korea. Namely, if the proportion of local purchase by FIE is more than (or equal to) 70% of the total purchase, then we label this FIE as domestic outsourcing type. Similarly, if the proportion of purchase from headquarter is more than (or equal to) 70% of the total purchase, then we label this FIE as insourcing type. Our logistic regression analysis considers parent firm data as well as FIEs' data. We find that the labor productivity of FIEs and R&D ratio of parent firm significantly increase the likelihood of being an insourcing type. On the other hand, the labor productivity of FIEs and R&D ratio of parent firm significantly increase the likelihood of being an outsourcing type. The higher the parent firm's capital-labor ratio, the more likely this FIE is an insourcing type. This result is consistent with the existing literature (Antràs, 2003; Antràs and Helpman, 2004; Corcos et al., 2013). Finally, the accumulated stock of FDI lowers its probability of becoming an insourcing type even though does not affect its probability of becoming an outsourcing type. The final section concludes with some thought about the future extensions.

This study was conducted to determine the role identity, leadership type (task-oriented leadership or relations-oriented leadership), and non-followership of subordinates of first-time supervisors, as well as their stresses in the context of Korean culture. This study particularly analyzes situational influences on the relations between the leadership type and the non-followership of subordinates by setting a low power position and new face-to-face relations as moderating variables. The theoretical background of this study has been introduced, and the hypothetical correlation among the variables, assumed. A survey was performed on a total of 185 first-time supervisors (section chiefs) appointed to their current position within the past two years, and the collected data were subjected to a regression analysis and structural equation modeling using SPSS and AMOS. The results of the statistical analysis are as follows. First, with regard to the role identities of the first-time supervisors, a positive correlation was observed between task-oriented leadership and relations-oriented leadership. The correlation was more pronounced in the relations-oriented leadership, which demonstrates that the role identity of a first-time supervisor puts the formation of kinship with subordinates first in the context of Korean culture. Second, a positive correlation was observed between task-oriented leadership and non-followership of subordinates. Additionally, the lower the power position of the first-time supervisor was, the more task-oriented leadership worsened the non-followership of the subordinates. Third, a positive correlation was seen between the non-followership of the subordinates and the leadership stresses of the first-time supervisor. The result shows that the first-time supervisors shall be under much stress should their subordinates not collaborate with them in their work nor respect them or implement their directed tasks, and that the first-time supervisors could themselves trigger their stress. In other words, given that leadership stress is caused by the non-followership of the subordinates, which is again triggered by the task-oriented leadership of the first-time supervisor, task-oriented leadership does not coincide well with the cultural characteristics of Korea. Fourth, relations-oriented leadership failed to instigate the followership of subordinates, even if the first-time supervisor had a low power position and was not acquainted earlier with his or her subordinates. The implications and limitations of this study were discussed.

Due to financial globalization and convergence of financial regimes, the International Accounting Standards Board (IASB) is enhancing international comparability of accounting information by improving usability has been implementing the International Financial Reporting Standards (IFRS). In addition, the IASB has been trying to improve the timeliness and usefulness of the information evaluating assets and liabilities by introducing the concept of current value. With the IFRS fully implemented in 2011, it is expected to greatly affect other comprehensive income. Some equity items such as revaluation surplus of tangible and intangible assets, actuarial incomes from defined benefit obligation and plan assets have been included in the other comprehensive income of financial statements following the adoption of IFRS. Those items are transitory which means their values are susceptible to price changes. When the price of those items fluctuates, ROE (Return On Equity) will decrease comparably to the diluted effect of potential ordinary shares in computing diluted EPS(Earnings Per Share). This study tests whether the value relevance of other comprehensive income has decreased in the era of IFRS due to the inclusion of some transitory items. Our sample is KOSPI listed companies (except financial institutes) under K-GAAP in 2010 and that of companies adopting IFRS early in 2009 and 2010. We compare the value relevance of KOSPI-listed companies under K-GAAP in 2010 to companies adopting IFRS in early 2009 and 2010. Furthermore, we also tested the difference of value relevance pre-IFRS and post-IFRS sampling companies that adopted IFRS in 2009 and 2010. For additional testing, ROE was divided into two groups. One is ROE without other comprehensive income’ influence and the other is ROE influenced by other comprehensive income. The results suggest that value relevance of ROE under K-GAAP existed but decreased significantly under K-IFRS. Moreover, value relevance of ROE influenced by other comprehensive income was lower for K-IFRS than under K-GAAP. This implies investors will place lower value on IFRS adopted companies for the other comprehensive income. We also introduced the EPS dilution effect for the other comprehensive income of financial statements following the adoption of IFRS. This study contributes to future studies by showing that when including income from transitory items in other comprehensive income are not favorable methods with regard to value relevance. As a result, IFRS adoption can cause a decrease of value relevance. However, these results are for companies that voluntarily adopted IFRS, so it is not conclusive to make a generalization. Also, our sample is only for the pre-IFRS period, we therefore can not generalize the research results. For additional study, we have to expand the research for post-IFRS period using sufficient sample and data.

Kothari et al.(2002) and Amir et al.(2007) contend that R&D investments are more risky than capital investments. However, Chambers et al.(2000) argue that risk of R&D firms is indistinguishable from that of capital investment firms. The factor models could be incomplete in identifying and measuring risk (Loughran & Ritter, 1995; Fama, 1998; Mitchell & Stafford, 2000). This paper investigates the relative risk without explicitly identifying the sources of risk, and thus we can avoid the bad-model problem of risk measuring. The empirical findings show that R&D firms are not fundamentally more risky and capital expenditure firms are not fundamentally less risky. The reason is that capital investment firms invest as much as their matching non-capital investment counterparts not only during the worst states but also during the best states of the world. The findings do not support Kothari et al.(2002) and Amir et al.(2007), but support Chambers et al.(2000).

The purpose of this study is to examine the factors influencing entrepreneurial activity of entrepreneurial attitudes, perceptions, and intentions and mediated effects of entrepreneurial intention using GEM (Global Entrepreneurship Monitor) data. This model tests various theoretical research hypotheses relating to entrepreneurial attitudes and perceptions, entrepreneurial intentions, and entrepreneurial activity. The proposed model is analyzed to target GEM data from 2011 to 2013. The result of hypothesis testing are as follows. First, entrepreneurial attitudes and social perceptions positively influence entrepreneurial intentions. Second, entrepreneurial attitudes and entrepreneurial intentions positively influence entrepreneurial activity. But social perceptions does not influence directly on entrepreneurial activity. Finally, entrepreneurial attitudes and social perceptions affected entrepreneurial activity by mediating entrepreneurial intentions. The results of this study will provide various implications to improve entrepreneurial activity and intentions.

Analysing economic conditions of Seoul and industrial innovation based on global environment, this paper conduces current issues and political implications for the future of Seoul. On this base, we analysis and forecast '2030 Seoul economy ecosystem' for the sustainable economic development. We implement Industrial working condition and mega trends analyses and then induces political implication for 2030 Seoul economy. Main focus is on urbanization, ageing, population structure, and technology innovation for this 2030 seoul vision. According to the mega trends analyses Seoul faces challenges as follows: as aging society problem; decrease of labor force; poverty gap and polarization among economic agents; poverty gap and polarization among regions; decline of manufacturing base; reduction of jobs; transfer of main government office to local area; industrial competitiveness level down, growing of international competitiveness among global cities; emergency situation resulting from climate change. Based on the prospect for 2030 Seoul economy ecosystem, several trends are possible. First, Newspaper should be replaced by electric newspaper. Second, New business based on new media and big data will come true. Smart working situation and conditions are normal in the working area.

With the development of the manufacturing industry, 'Servitization' and 'Convergence of Industries' have been spread. In the middle of these changes, a collaborative network of companies have come to be noticed. This study presents ‘a performance mechanism of servitization’ based on the collaborative network which is derived through literature review of servitization and network organization theories. Then we carried out empirical research to verify how the performance mechanism works in the domestic industry. Our model explains the process that network relationship among members and collaborative capabilities are built by service-oriented culture in a focal firm, and then servitization performance are facilitated by those factors. Also, service-oriented organizational culture enhances the network relationship and capabilities. Our survey instrument was developed based on the constructs for the mechanism. The questionnaire was developed using a Likert's 7 point scales and included some demographical data. 300 survey records were collected. 247 among them was considered valid for the analysis. Reliability test and validity test results confirms all related data were acceptable for the path analysis. Through the hypothesis, hypothesis H4(network relationship will affect servitization performance) was dismissed. this result concurred with the claims that korean manufacturing industries are characterized by vertical integration of large conglomerates and subcontracting relationship, and there has been many obstacles to make synergies between the large and small businesses. Hypothesis H1(Service-oriented organizational culture → Network relationship), H2(Service-oriented organizational culture → Network capabilities), H3(Network relationship → Network capabilities), H5(Network capabilities → Servitization performance) of the structural equation model is positively confirmed. Results show that network relationship has a mediation effect on the servitization performance via network capabilities. Overall, the superiority of our structural equation model was confirmed. This study extended the research opportunities of servitization with the network perspectives. Also, this study will provide management with strategic insights for preparing servitization strategy and self assessment chances.

This paper compares creativity capacities of 15 major OECD countries including Korea by measuring ‘Creativity Index’. Richard Florida has first developed Creativity Index. By comparing Creativity Indices of 15 countries, this paper aims to find the current status of Korea in knowledge-based or the so-called creative economy. To measure Creativity Index, the paper introduces almost same methodology used in Florida & Tinagli (2004), and improves it with recent data. In Florida & Tinagli (2004), Creativity Index was comprised of Talent Index, Technology Index, and Tolerance Index(3Ts) from 9 sub-indices. This paper modified the 9 sub-indices into 8 for more clarity in measuring. To measure one country’s relative position, the authors also employ '15 points grading'. The grading is to give 15 (points) to the country which has the highest value. Talent Index is comprised of Creative Class Index, Human Capital Index, and Scientific Talent Index. Finland is on the top among other countries. Sweden, Norway, and Switzerland are just behind the first one. For Korea the country is ranked 10th, because the country’s creative class index is not high. Technology Index is based on Innovation Index, High Tech Innovation Index, and R&D Index. Switzerland is the highest country defeating other countries. Sweden, Finland, and Japan are the second group members. Korea is the 6th because of its heavy R&D investments. In Tolerance Index, Sweden is the very tolerant country to minorities and non-traditional behaviors. Norway, the Netherlands, and Slovenia are the 2nd group. Korea, on the contrary, shows no excellence in‘tolerance’ ranking the bottom of the index. When the 3Ts are aggregated, Sweden is the top position in Creativity Index. In the 2nd group there are Switzerland, Finland, the Netherlands. Because of the country’s poor value of Tolerance Index. Korea is down there ranking the 11th. In conclusion, Korea’s Creativity Index is somewhat poor. In order for improving competitiveness in Creativity Index, authors recommend the following measures. First of all, society of Korea should be tolerant to minorities and non-traditional ideas & behaviors. Second, Korean government needs to pay more attention in promoting creative class in the longer term with large investments.

Many important researches have been focused on identifying the root causes that make a significant difference in income, added value, productivity and so forth. However, this study aims to understand how innovative capabilities impact on the economy growth in a particular region among the regions in the perspective of technological innovation. Before analyzing the regional growth into the level of innovative capability, a data sheet has been prepared for the study which is made of the level of innovative capability, socio-economic data for 16 different local governments. It went through a data transforming process to offset the effect of regional size difference as well as to overcome the economy of scale by which it introduces a value per capita or a common logarithm for better estimation. The time table is set from 2006 to 2012 for a period of 7 years since the data for regional investment is available from 2006, and it also includes the Sejong-city into Chungcheongnam-province due to maintaining consistency in categorizing regions. Appraisal model uses GRDP(Gross Regional Domestic Product) as a dependent variable and various innovation factors as independent variables with industrial variables and socio-economic variables as control variables as well. After analyzing overall regions, a comparative study has been subsequently carried out to draw any substantial implication in the policy making. While Module I is used for the total of 16 metropolitan city or Do, Module II is applied to a separate set of city or Do in which each has 8 data. Module Ⅲ has followed the steps to compare the size effect of economy between two groups of 6 regions with high or low GRDP. In the perspective of technology innovation, it can be summarized as follows: The regional economic growth has a negative correlation against the government sponsored R&D investment whereas it has a positive correlation with total amount of R&D investment and the number of researchers or 4-year colleges in the region. It implies the government sponsored R&D has been invested to regions from the standpoint of regional balanced development. Conversely, the autonomous investment is active in the private sector among regions with high economic growth. There are important policy implications from the result of empirical study: Firstly, government innovation policy should be diversified to each region having different economic environment and growth stage. Secondly, GSR(Government Sponsored R&D) for service industry should be enlarged because the weight of service industry and national R&D investment have no relationship from the empirical result of the regional analysis. Thirdly, national innovation policy should be led and focused on the efficiency of science and technology policy. One can expect to virtuous circle like "improvement of innovative capability of the region → regional economic growth → expansion to adjacent region → national-wide economic growth" through differentiated Science & Technology innovation policies depending on the situation of a given region.