Rebalancing: a case study of South Korea

Previous governments restricted the expansion of universities in Seoul. In the 2000s, a new government put universities in charge of regional growth

Discussions over ‘rebalancing’ the economy outside of London by strengthening other regions – explored in part one and part two of this miniseries – are not unique to the UK.1 South Korean academic Haknoh Kim writes that:

Balanced development is not a new policy goal in South Korea. Two basic facts – too heavy a concentration in the “Seoul capital region” and a very limited degree of political decentralization – have aggravated the disparities across regions in Korea for a long time… the Seoul capital region, only 11.8% of the South Korea’s total areas, accommodates 46% of the population, 57% of all manufacturing firms, about 70% of enrolled university students, 2/3 of financial activities.

In the mid-2000s the South Korean government prioritised decentralisation and balanced development as a national priority, but, unlike previous governments, saw this ‘as a means to strengthening the competitiveness of the country as a whole’.2 Yong-Sook Lee, an academic at Korea University, explains how balanced national development was encouraged through innovation:

…the PCBND [Presidential Committee on Balanced National Development] set up 14 regional innovation councils with 725 commissioners across the country… These councils were designed to encourage local initiatives in creating and implementing regional policy. To achieve self-sustaining endogenous development, the PCBND pursued a Nuri [New University for Regional Innovation] project that nurtures local talent by supporting local universities. In 2004, the government allocated a five year grant of 1.4 trillion won [about £900m at today’s rate] for cultivating local talent in promoting regional strategic industries. In 2006, a grant of 260 billion won [£170m] was awarded to 109 local universities in non-capital regions… Furthermore, the PCBND placed emphasis on reinforcing networks between local universities and local industries for the purpose of boosting R&D activities in non-capital regions.

Universities seem to play a particularly prominent role in South Korea. Kim expands on the New University for Regional Innovation concept:

NURI promotes “competition” within respective provincial regions by concentrating financial support on excellent projects selected in each region. It is worth noting that local universities form the project headquarters in NURI programs. They should include in their project teams other regional innovation actors such as other interlinked universities, research institutes, local authorities, business firms, or NGOs. This way, the principal universities serve to build and expand innovative networks between business, academia, public authorities, and other related actors.

Arguably, business is underrepresented. Here is the composition of the Daegu-Gyeongbuk Regional Innovation Council in 2006, where universities are nearly a quarter of members but business less than 10 percent:

Category Number of councillors
Local/regional authorities (including civil services) 23
Research institutes 7
Civil society (including NGOs) 19
Universities 24
Business 9
Press 6
Innovation supporting agencies 12
Total 100

Kim concludes that ‘the emergence of regions as an autonomous and important actor in the development of the country is quite a remarkable progress in Korean society’. However, ‘Korea is lagging behind in that it lacks “regional experimentalism” found in Europe’, mainly due to a lack of ‘sufficient autonomy and independent resources despite the participatory government’s emphasis on bottom-up approach’.

Whilst universities have been instrumental to South Korean attempts at rebalancing, genuine autonomy, devolved resources and partnership between important local actors are required for regions to be strengthened. It would be valuable to see progress in the ten years since the two academic articles referenced here.

This blog is in three parts. Previously we looked at the future of the Northern Powerhouse, and how universities can help realise the benefits of agglomeration.

Photo: Daegu, Korea on Flickr


  1. My interest in South Korea was piqued by a single reference in the excellent Nations and the Wealth of Cities publication by the two Greg Clarks: ‘the national government has employed a strategy to diversify economic activity from the dominant Seoul capital region by incentivising clusters and universities to scale up in the regional cities. The complementary economic roles of Busan’s seaport and Daegu’s manufacturing expertise have also been significantly supported’. 
  2. Previous administrations tried to rebalance the economy by many means, including applying brakes on Seoul’s development by restricting the expansion of universities, factories, shops and other development that might attract migrants. Did we see an echo of this in the UK, albeit under a different policy narrative, in 2015 with the proposed crackdown on satellite university campuses in London, ostensibly to stop exploitation by economic migrants? 

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