Research Reports
Regional Comparison of Industrial Activities and Industrial Revitalization in Rural Area
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AuthorKim, Jeonghong
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Publication Date2004.12.01
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Original
Throughout industrialization and urbanization, disparities between regional industries have deepened and widened. Therefore, the achievement of balanced regional development has become an important policy theme. To attain policy goals of balanced regional development, the development gap between urban and rural industries should be eliminated.
In Chapter 1 of this study, the gap of industrial development between urban and rural areas is surveyed, and the characteristics of the industries located in each region are analyzed. Then existing problems are described, and the direction for rural development is suggested. Hopefully, this study can contribute to reducing disparities between regional industries.
Chapter 2 analyzes the status of manufacturing and service industries in urban and rural areas, and classifies regions by development degree and industry, and then suggests policy tools. In this study, the KSIC 2-digit code of manufacturing data from the years 1995 to 2002 was used. The severe disparities between urban and rural areas, as well as between rural areas were analyzed. For example, the percentage of urban manufacturing industries was 80% in 1995, but in 2002 the figure rose to 87～88%.
In Chapter 3, an interview-based survey was conducted for residents in Haman-gun, Gyeongsangnam-do as a representative of developed area and Yungdong-gun, Chungcheongbuk-do as a representative of underdeveloped area. During the survey, the focus was put on comparing location, industrial development, supporting policies of local government, and regional problems between the developed and underdeveloped regions. Based on the results of this analysis, it is concluded that the most important thing for regional development is to foster strategic industries within the region. For example, Haman-gun has many machinery-related firms, which constitute a strategic industry of Gyeongsangnam-do, but Yungdong-gun doesn't have such strategic industries. However, differential factors between the two regions, such as distribution of resources, policy measures of local governments and prices of industrial sites, are not that significantly different.
In Chapter 4, the trends of industrial location policies and rural industrial park policies are reviewed. Next, recent policies for balanced regional development are studied. In this study, it is found that the government supports strategic industries mainly in urban areas, and developed regions have heavy and knowledge-based industries due to many policy measures. But the government has been less supportive of rural industries to date and underdeveloped regions have only light and traditional industries. In the future, the central government needs to be more interested in fostering rural industries.
In Chapter 5, the fostering of rural industries through the use of agricultural products and resources and the raising of their competitiveness are stressed. It is very difficult to foster advanced industries in rural areas within a short time, because rural areas doesn't have universities, research institutes and companies. So the central and local governments have to identify and foster competent industries in such areas. According to the survey, the rural residents want to have agricultural and manufacturing industries together in their region.
The first section of Chapter 6 describes the causes of underdevelopment of rural industries. The discovered causes are as follows: ⅰ) Based on the theoretical models, it seems that the disparities between urban and rural areas have deepened because knowledge spillover from urban to rural areas haven't properly occurred; ⅱ) The differences in industrial structures have caused the disparities between urban and rural areas. Therefore, the rural areas have to restructure their industries to enable them to produce high added values; ⅲ) Comparing the case study regions, it is found that location conditions and industrial structure connections to near-urban industries are important factors in producing regional disparities; and ⅳ) The interview of the rural residents were conducted to explore the causes of underdevelopment of rural areas and how to resolve them.
In the second section of Chapter 6, the measures to resolve the causes of underdevelopment are proposed. This section puts a focus on the fact that the agricultural industry has its limit in developing rural areas in the future, so that by fostering other local industries based on agricultural products and resources, local governments have to increase rural incomes. Moreover, to develop rural industries, it is important to establish clusters and RIS's (regional innovation systems) centered on rural industries, such as high value-added agricultural processing industries and the revitalization of industrial parks in rural areas.
Researchers: Jeong-Hong Kim.
E-mail address: Kimjh@kiet.re.kr
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