Does a Technology Incubator Work in the Regional Economy? Evidence from South Korea

There has been a recent trend among policymakers to consider the science park as a knowledge-based economic development strategy—one that encourages and supports the start-up and development of innovation-led industry. This paper assesses the effectiveness of the South Korean technopark. Technoparks on average had a higher number of tenants, tenant employees, and tenant firm sales compared to those of the other business incubators in Korea. Although the survival rate was relatively high in technoparks compared to that of the other business incubators, some of the technoparks were not effective at encouraging tenants to graduate from the incubator in a timely manner. The support program provided by the technopark format enables firms to easily access innovation resources and to reduce the costs of doing business. The incubator reduces the operating costs of tenant firms by providing facilities and shared services at low cost as well as aiding in market expansion. Moreover, the incubator provides tenant fir...