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Taiwan’s Semiconductor Industry: What the State Did and Did Not
Author(s) -
Tung AnChi
Publication year - 2001
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/1467-9361.00123
Subject(s) - commercialization , government (linguistics) , bureaucracy , state (computer science) , semiconductor industry , venture capital , capital (architecture) , first mover advantage , business , economics , value (mathematics) , industrial organization , market economy , marketing , finance , engineering , political science , linguistics , philosophy , archaeology , algorithm , machine learning , politics , computer science , law , history , manufacturing engineering
Relative to Korea, Taiwan’s semiconductor sector combines high value‐added, low risk, and an innovative mode of virtual integration, which is adapted to the new world of “fabless” and “chipless” operations, away from the older style of integrated device manufacturers. The rise of this owes much to the catalytic government role which overcomes market failures to launch institutions in each of the five stages of the industry’s evolution, introducing pre‐commercialization research, nurturing industrial clusters, providing venture capital, and spinning off world‐class, privately managed firms as well as attracting the interest of traditional business groups, without ever micro‐managing the development as bureaucratic state enterprises. The state operates in a manner which is both distinctively different from the practice of Brazil, India, Japan, Korea, or Singapore, and also apparently replicable elsewhere.