• The Journal of the Korea Contents Association
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• v.21 no.3
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• pp.184-193
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• 2021

This paper investigates the performance of technology innovation activities performed by firms in 16 major regions in Korea using 2002-2010 survey data by STEPI. The theoretical and empirical analysis is carried out via the 2 models which are the simple R&D - total revenue model and Cobb-Douglas model based on the simple model adding labor variable. The main results shows that for simple model, the R&D elasticity for total revenue is 0.42 for all areas and Ul-San shows the highest elasticity level, 0.66 and Bu-San the lowest level, 0.2. In case of Cobb Douglas model the R&D elasticities are not statistically significant for many regions. To overcome the low statistical significance, we grouped the 15 regions for 3 wider regions using ANOVA based on the R&D intensity for the homogeneity of R&D activities. By grouping, each region has more observations to analyze and the results from the empirical analysis shows higher statistical significance level and data explanation capability. In this case, Group 3 which shows larger firm size and slightly higher export share shows the highest level of R&D elasticity, 0.088 and Group 1 which has the smallest firm size and the lowest revenue growth rate shows the lowest level, 0.31. For the labor elasticity, Group 1 shows the higest level, 1.16 and Group2 the lowest level, 1.096. These results show that the regions which have many middle and small firms reveal low R&D-revenue elasticity and high labor-revenue elasticity.