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Taiwan’s Semiconductor Industry: What the State Did and Did Not

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  • An‐Chi Tung

Abstract

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.

Suggested Citation

  • An‐Chi Tung, 2001. "Taiwan’s Semiconductor Industry: What the State Did and Did Not," Review of Development Economics, Wiley Blackwell, vol. 5(2), pages 266-288, June.
    • Handle: RePEc:bla:rdevec:v:5:y:2001:i:2:p:266-288
    DOI: 10.1111/1467-9361.00123
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    Cited by:

    1. Gao, Hongzhi & Ren, Monica & Shih, Tsui-Yii, 2023. "Co-evolutions in global decoupling: Learning from the global semiconductor industry," International Business Review, Elsevier, vol. 32(6).
    2. Kuen-Suan Chen & Chun-Min Yu, 2022. "Lifetime performance evaluation and analysis model of passive component capacitor products," Annals of Operations Research, Springer, vol. 311(1), pages 51-64, April.
    3. Hou, Chung-Kuang, 2012. "Examining the effect of user satisfaction on system usage and individual performance with business intelligence systems: An empirical study of Taiwan's electronics industry," International Journal of Information Management, Elsevier, vol. 32(6), pages 560-573.
    4. Jun Hong Park & Hyunseog Chung & Ki Hong Kim & Jin Ju Kim & Chulung Lee, 2021. "The Impact of Technological Capability on Financial Performance in the Semiconductor Industry," Sustainability, MDPI, vol. 13(2), pages 1-20, January.
    5. Chan‐Yuan Wong & Christopher J. Russell, 2024. "A search dilemma for market niches: Korea and Taiwan in a time of US‐China high‐tech decoupling," Global Policy, London School of Economics and Political Science, vol. 15(2), pages 475-486, May.
    6. Wang, Chi-Tai & Chiu, Chui-Sheng, 2014. "Competitive strategies for Taiwan's semiconductor industry in a new world economy," Technology in Society, Elsevier, vol. 36(C), pages 60-73.

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