연구개발 성과 기반 일자리 창출 방안 연구

2022년 7월

과학기술정보통신부

장 은 영

차 례

국외훈련 개요	2

훈련기관 개요	3

Ⅰ. 연구 개요	6

Ⅱ. 연구개발 성과 향상을 위한 국가혁신시스템 변화에 대한 연구 – 한국과 영국의 사례(A Study on Changes in the National Innovation System - Focusing on the Cases of the UK and South Korea)

1	Introduction	7

2	National Innovation System (NIS)	10

3	International Experiences with Innovation Systems	26

4	UK's National Innovation System	34

5	Korea's National Innovation System	43

6	Conclusion	56

References	61

Ⅲ. 영국의 스케일업 지원정책 비교 및 일자리 창출 측면에서 한국 정책에의 함의(Comparison of UK Scale-up Support Policy with Korea and Implications to Korean Government)

1	Introduction	66

2	Policy Backgrounds	69

3	Previous Research	73

4	UK’s Scale-up Support System	76

5	Korea’s Policy State	86

6	Comparison and Policy Recommendations	94

7	Conclusion and Limitation	99

References	102

국외훈련 개요

1. 훈련국 : 영국

2. 훈련기관명 : 엑서터 대학교 (University of Exeter)

3. 훈련분야 : 일자리창출

4. 훈련기간 : 2020.10.2. ∼ 2022.8.1.

훈련기관 개요

1. 기관 개요

o 훈련국가 : 영국

o 훈련기관명 : 엑서터 대학교 (University of Exeter)

o 인터넷웹주소 : www.exeter.ac.uk

o 주소 : (Streatham Campus 기준) Northcote House, Exeter, EX4 4QJ

2. 기관 소개

1) 연혁

o 엑서터 대학교(University of Exeter)는 1855년에 세워진 엑서터 예술학교(Exeter School of Art)를 모태로 하여 1955년에 현재의 종합대학으로 개교

- 엑서터 예술학교는 1893년 케임브리지 대학교의 지원을 받아 ‘엑서터 기술·확장 대학(Exeter Technical and University Extension College)’으로 발전

- 1900년 ‘로열 앨버트 메모리얼대학’, 1922년 ‘잉글랜드 사우스웨스트 유니버시티칼리지’로 개칭

o 1955년 왕실의 칙허장을 받아 '엑서터 대학교'라는 교명으로 종합대학으로 승격

- 1978년 세인트 루크 대학(St Luke's College of Education)과 합병하여 콘월(Cornwall)의 1개 캠퍼스와 엑서터 시의 2개 캠퍼스를 갖춘 오늘날의 캠퍼스 수립

2) 구성 및 운영

o 영국 데본 주(Devon County) 엑서터 시에 위치하였으며, 인문대학, 사회과학·국제학대학, 생명·환경과학대학, 공학·수학·물리학대학, 경영대학, 의과대학, 스포츠대학 등 구성

o 영국의 연구 중심 대학 19곳으로 구성된 단체 ‘1994그룹(1994 Group)’에 속해 있으며 영국의 연구 중심 대학 협의체인 ‘러셀 그룹(Russell Group)’의 일원

o 2022년 기준 150여개국 출신의 3만여 명의 학생이 재학 중이며, 석사과정 이상의 학생은 약 22%의 비중으로 최근 5년간 수업석사(Postgraduate Taught)의 비중이 증가하고 있으며, 유학생은 약 21.7%의 비중

o 영국의 대학평가 기관 QS에 따르면, 엑서터 대학교는  재학생의 높은 연구실적뿐 아니라, 졸업생과의 파트너십이 강한 대학으로 평가

3) 소속학과 소개

o 다른 많은 영국 대학들과 마찬가지로, 엑서터 대학교도 행정학(Public Administration)이나 정책학(Public Policy)은 정치학부(Politics) 내 세부전공으로 운영

- 정치학부는 엑서터 시 스트레덤(Streatham) 캠퍼스에 위치

o 2022년 대학평가에 따르면, 엑서터대 정치학부는 영국 내 15*위, 전체 15위로 행정학을 포함한 정치학에서 영국 내 우수한 학교 중 하나로 인식

* https://www.theguardian.com/education/ng-interactive/2021/sep/11/ the-best-uk-universities-2022-rankings

3. 입교 교섭자료

1) 훈련준비

o 훈련기관 입교를 위한 입학허가 신청

- CV(이력서), SoP(Statement of Purpose) 작성

- 어학요건 충족 필요

o 지원과정 커리큘럼에 대한 사전 조사 및 스터디

2) 외국어요건

o MPA Master of Public Administration with Applied Study 과정 기준

- IELTS : Overall 6.5, 영역별로 6.0 이상

- TOEFL : Overall 90점, 영역별로 writing 21점, listening 21점, reading 22점, speaking 23점 이상

3) 학비 관련

o MPA Master of Public Administration with Applied Study 과정 2020/21학년도 신입생 기준 총 £25,000

- Year 1: £18,875, Year 2: £6,125

4) 비자 관련

o Tier 4 Student Visa 발급 필요

- 먼저 엑서터 학교에서 Offer 확정 후 CAS(Confirmation of Acceptance for Studies)가 발급되면 비자 신청 가능

Ⅰ. 연구 개요

2020년 연구계획 설정 당시 한국의 고용률은 예년에 비해 매우 저조한 상태로 한국 사회 전반의 큰 정책적 이슈였다. 이에 따라 당시 일자리위원회 근무 중인 점을 감안하여 우리나라의 연구개발 투자가 일자리 창출로 연계될 수 있는 방안을 고민하고자 연구계획을 설정한 바 있다. 영국은 전세계적으로 연구개발 투자 대비 성과가 높은 국가로서 이와 관련된 정책사례도 다양하게 보유하고 있어 좋은 시사점을 줄 수 있을 것으로 전망했다.

다만, 이후 2021년부터는 한국의 고용률이 점차 개선되고 실업률이 감소하면서 일자리 창출이라는 정책적 화두에 대한 관심도가 상대적으로 낮아진 것이 사실이다. 또한 지도교수와의 면담을 통해 연구계획을 점검하던 중 연구개발의 성과를 평가하는 부분에 있어 선행연구가 많지 않고, 개념적으로 모호한 점이 많다는 부분을 직시하고, 연구계획의 방향을 연구개발 성과를 강화할 수 있는 혁신정책의 개선을 위한 혁신체제 이론 및 구체적인 혁신 분야 지원정책에 대한 한-영 비교를 연구 주제로 설정하였다.

이에 따라, 1년차 연구논문의 주제로는 국가혁신체제의 이론적 흐름과 주요 국가들의 혁신시스템 비교를 통해 한국의 국가혁신체제 개선을 위한 시사점을 도출하였다. 혁신정책에 대한 이론적 기반은 임무지향적 접근방식과 시장실패론, 혁신체제론으로 발전되어 왔다. 국가혁신체제에서 중요한 의문은 혁신활동의 효과성에 있어 국가별 차이가 나타나는 이유에 대한 것이다. 본 연구에서는 국가혁신시스템(NIS: National Innovation System)의 차이를 정부의 혁신정책 거버넌스 관점에서 비교한다.

2년차 정책보고서의 주제로는 혁신정책의 일환으로서 구체적으로 일자리 창출에 적용 가능한 분야를 선별하고, 특히 영국 정부의 지원정책에서 시사점을 얻을 수 있을 분야로서 스케일업(Scale-up) 지원정책에 대해 한-영 정책비교를 설정하였다.

Ⅱ. 국가혁신시스템 변화에 대한 연구 – 한국과 영국의 사례

(A Study on Changes in the National Innovation System - Focusing on the Cases of the UK and South Korea

Introduction

The industrial environment is rapidly changing due to the rapid development of new technologies. Existing innovation methods face low growth, polarization, regionalism, climate change, and environmental problems. In particular, as digital technology does not stop at changing individual products or processes but is applied to industrial and social activities in almost all fields, the digital transformation that changes the way of production and life is accelerated. In this trend, Korea has continuously increased its national investment in R&D under the vision of innovation-led economic growth and social development. However, as the direction of pursuing R&D and investment expansion, which has driven industrial modernisation, fails to respond to the changes in the innovation circumstances, concerns are growing that it will lack practical results (Zastrow, 2016). Korea's ratio of R&D investment to GDP is the highest globally, but it lacks outstanding research achievements leading the academic field or innovation with enormous industrial and social impact. A concern of this article started here.

Rapid technological progress, informatisation, and globalisation are changing business survival and competition in the global market. In other words, if an individual company or national economy does not have technological capabilities as a source of competitive advantage, further survival and development will be impossible. Technical capacity refers to the a

bility to create new technologies, spread existing technologies, and use them as engines of economic growth. However, technological capability is not determined by the isolated efforts of a single inventor or individual company but rather depends on the network formed between companies and companies, between scientists and engineers, between companies and universities, and between users and suppliers. Accordingly, The innovation system approach to technological innovation has been proposed since the late 1980s, and countries worldwide have established and implemented science and technology policies based on this.

Korea's industrial, science, and technology policies have also been established and implemented based on the system approach. In other words, after the concept of the National Innovation System (NIS) was discussed in Korea at the end of the 1990s, the government has recently adopted the Regional Innovation System (RIS) concept while making balanced national development a top priority in the policy. However, the idea of NIS emphasises the institutional aspect too much, and the task of finding and cultivating innovative factors at the national level is too long and is not an easy task.

The national science and technology innovation system is a perspective and framework to comprehensively understand the macro-environment surrounding science and technology innovation, industry, academia, and research actors engaged in science and technology innovation, and mutual cooperative relationships among them and the infrastructure to support it. Despite its excellent policy utility, NIS has not been used macroscopically in Korea's science and technology policy. In Korea, extreme problematic situations and uncertainty such as low growth, the rising rate of unemployment, polarisation, low fertility, ageing, and new technologies such as AI are unfolding. Extending the traditional and customary way of thinking in the past may have limitations to seeking national science and technology policies to overcome these challenges.

In addition, Korea is moving from technology imitation and investment to the stage of leading innovation. It seeks to discover and foster new industries using next-generation technologies (e.g., biotechnology, nanotechnology) to replace semiconductor technology. Therefore, it is a crucial task to establish the concept of a Korean innovation system suitable for the situation of Korea.

Against this background, the purpose of this article is to review existing approaches to innovation, analyse the status of innovation systems in countries around the world, and find implications by comparing and analysing the case of the United Kingdom with Korea and synthesising all of them. It will work to seek implications of a new Korean-style innovation system suitable for the situation of Korea.

In particular, comparing and analysing the UK case with Korea, the UK has a very long history of innovation, starting with the Industrial Revolution. It is an event that marks the beginning of modernity in the human history of the innovation system, and it began during the Industrial Revolution. Of course, the role and influence of science on the industry was insignificant in the beginning. However, the endogenous evolution of the industrial revolution is recognised as an essential factor in the autonomous development of science and technology. In other words, technological innovation acted as a mechanism to trigger the industrial revolution and provided the relevant conditions. Although the Industrial Revolution is recognised as a result of scientific development, the scientific development of the past was applied to explain the working principle of technology through the Industrial Revolution period, and science developed along with it. UK's Industrial Revolution appeared as a product of technological development at the end of the 18th century. The UK took control of overseas markets one by one as production costs were reduced due to technological development, which continued until the UK became the world's factory. Therefore, re-illuminating the evidence of innovation in the UK can be a starting point for overcoming the limitations of Korea's current innovation system.

The structure of this article is as follows. Chapter one summarises the need for research on innovation systems in Korea and introduces the main contents of this article. Chapter two finds the existing approaches to innovation, including the National Innovation System theory and related concepts. Chapter three examines the current status of innovation environments and innovation systems in each country and uses Korea's perception of the innovation environment as a comparative criterion for review. Chapter four identifies the main points of the UK's innovation policy and the characteristics of the innovation system and reviews the changes in the innovation system. It also analyses the strengths and weaknesses and focuses on its differences with Korea. Chapter five analyzes Korea's innovation system's current status, strengths, and weaknesses and seeks to find implications suitable for Korean conditions compared to the UK. In particular, from the perspective of the evolution of the innovation system, it examines the changes in the innovation system and discusses the solved and unresolved problems. Finally, the research results are summarised.

National Innovation System (NIS)

Definitions

Innovation

Innovation is a process of creative destruction that creates new added value by breaking away from the existing trajectory of technological development (Schumpeter, 1942). Although there is a term to refer to the discovery or invention of new technology, the intentional use of innovation lies in a new perspective on science and technology. In the second half of the 20th century, “innovation” began to be widely discussed along with the effectiveness-oriented approach to achieving economic results by going beyond the discovery of science and technology and applying it to industrial fields. In this context, innovation refers to exploring new knowledge or technological invention and the activity and achievement of commercial application and implementation (Freeman and Soete, 1997; OECD 2018).

According to the Oslo Manual (OECD, 2005), innovation is “a new or significantly improved 1) product (good or service), 2) process, 3) marketing technique, or 4) method of organisation (business conduct, internal organisation, external relationships)” (OECD, 2005: p.46). In this definition, the minimum requirement for innovation must be something new (or significantly improved) in the business activity (OECD, 2005: p.46). Moreover, the unique feature of innovation is that it must be implemented in the market, so an invention that has not progressed beyond the demonstration stage is not considered an innovation.

On the other hand, Rogers (1983) defined innovation as an idea or practice newly recognised, accepted, and diffused by individuals or organisations in diffusion research. Innovation is understood as an activity that creates new added value in the social realm, not limited to industrial and commercial applications. The tendency to understand the usefulness of innovation by extending it to various social and environmental values, rather than reducing it to economic values, has recently been strengthened (Diercks et al., 2019).

In conclusion, although the understanding of the value of the final implementation of innovation is somewhat different depending on the approach, innovation is a concept that emphasises that new knowledge or technology is applied to reality and expressed as practical value. Innovation is no longer just about applying new technologies to specific processes or products. It is expanding to accommodate and respond to social and environmental conditions that enable innovation and social and ecological needs for innovation. There are doubts about the extent to which current research and innovation activities can accommodate non-economic values whose compensation mechanism is unclear and whether such attempts can replace the existing innovation activities centred on industrial and economic development. However, the present society is requesting innovation not only for industrial development but also to accommodate broader social and environmental demands. Accordingly, innovations in a broad sense such as inclusive innovation, social innovation, ecological innovation, and system innovation are on the agenda.

Innovative Policy

Simply said, 'innovation policy' means any government intervention to create and disseminate innovation. When we talk about 'innovation', we focus on the corporate sector. However, the target of innovation policy includes corporations and the public sector, universities, non-profit organisations, and various intermediate organisations. The innovation policy goals can even be social and economic roles at the national level and comprehensive missions such as global contribution.

Therefore, innovation policies do not exist only to promote innovation activities in enterprises but are established within the sphere of the national system and the sphere of influence of innovation. There are some differences between the general concept of innovation and the logic that diagnoses the nature of innovation from a policy point of view and justifies government intervention. To alleviate this difference, international organisations such as the OECD use the term 'Science Technology Innovation Policy (STI policy)' as a policy term. The science and technology innovation policy not only implies the possibility of government intervention in a wide range of R&D activities, from basic research to development research, beyond the narrow definition of innovation presented in the Oslo Manual, but also includes all activities such as financial investment, education, and market environment. It is a term that broadens the scope of government intervention in all conditions related to innovation.

When innovation is from a large system such as a national system, the tendency of system complexity, self-organisation, and resistance to change can appear. In the early stages of the creation of the system, it acts in the direction of increasing the efficiency of innovation and improving performance. However, if one giant system is established, it may cause inefficiencies that cannot reflect the changes of the times or external demands. Therefore, the fixation of such an innovation system becomes an important policy issue.

Recently, the growth and convergence trend of digital technology is remarkable. As the first-generation Internet-based technology expands to mobile and cloud-based technologies and combines technologies such as the Internet of Things, big data, blockchain, and artificial intelligence, digital technology is now pioneering new service and product markets. This trend is changing the topography of the existing industry in line with corporate global network activities that continue to intensify. With the digital technology and mobility revolution, innovative activities' time and space constraints will gradually decrease, the prospect that global network-based production and service innovation will be accelerated is prevailing. Efforts to take the initiative in these rapid changes in technological innovation become one of the pillars of innovation policy.

Conversely, however, there are reflections that understanding past innovations does not capture the changes occurring in the present and the challenges to come. So far, we have assumed that technology and innovation are always positive through the Schumpeterian frame of 'creative destruction', but there are objections to this. Innovations in 'disruptive creation' in the electronics or apparel industries induce excessive purchases by deliberately shortening the use cycle of goods, waste resources, and unsustainable growth. So, existing innovations theory may not be able to explain. (Soete, 2014) Therefore, macro-topics such as system understanding and sustainability from a global perspective are receiving attention together. Questions about these innovations are also affecting the science and technology community in Korea. Macro topics such as the challenge of globalisation lead to green growth and an approach to solving social problems. In addition, the reliability, ethics, and accountability of research results are emphasised.

Different Approaches about Innovative Policy

Mission-oriented Approach

The traditional concept of mission-oriented policy is government-led R&D and innovation to achieve a specific national mission. The Manhattan Project and the Apollo Project are typical examples. The mission-oriented policy develops and implements top-down technology systems led by professional public organisations like NASA to achieve clear national goals.

Recently, a reinterpretation of mission-oriented innovation policies is being carried out. In 2018, the European Union published a policy report titled "Mission-oriented Research and Innovation in the European Union: A Problem-solving Approach to Fuel Innovation-led Growth". A new paradigm to lead the world was proposed (Mazzucato, 2018). As indicated in the title of this report, this policy emphasises that activities to solve social challenges are the foundation for sustaining innovative growth. This policy presents a 'work to be done' or a state to be reached through problem-solving to solve social challenges and takes an approach that converges existing technologies and industries to implement it.

According to the mission-oriented innovation policy, the government must demonstrate entrepreneurial spirit and make leading investments and venture investments that form a technological foundation and new markets to respond to social challenges. Such venture capital investment by the government becomes an essential driving force to attract innovation investment from the private sector. A mission-oriented approach is being re-evaluated in the face of a series of national crises related to the recent covid-19 worldwide. However, this mission-oriented approach differs from a macroscopic and long-term approach, and there is a limit to becoming a theory.

Market Failure Theory

In the neoclassical tradition of microeconomics, research on market failure has been accumulated since Arrow (1963). This discussion of market failure has great significance in that it theoretically provided the basis for government policy intervention in science and technology innovation. Market failure refers to "a state in which the market economy system fails to supply certain goods or products at an optimal level or all" (Pearce, 1986). It can be said that market failure theoretically proves the basis for government policy intervention in a wide range of areas. Science and technology innovation has been pointed out as one area requiring government policy intervention and has justified intervention in science and technology policy since the 1960s.

The rationale for the science and technology innovation policy provided by the market failure theory is obvious. It is necessary to correct these market failures because science and technology innovation investment may be underrated due to the indivisibility and uncertainty of science and technology innovation investment performance. In addition, due to the externality effect of science and technology infrastructure, there is a problem of free-riding in the market and underinvestment in science and technology infrastructure, so government policy intervention is necessary.

The market failure theory has three theoretical advantages (Hauknes, 1999):

The market failure theory presents a clear and concise standard of optimising social returns and promoting welfare for whether or not a market problem is a market failure and whether the government should intervene. Through this, it can be said that the rationale for government intervention has been theoretically simplified.

Market failure theory can be a guideline for government policy establishment. It can be an analytical framework that can be used to evaluate economic feasibility on the correlation, such as what kind of output is produced when public resources such as establishing a public foundation are put in the policy.

Market failure theory can provide guidelines for optimal decision-making on where and to what extent government budgets should be used.

However, limitations of the market failure approach have also been pointed out. Hauknes (1999) stated that the market failure theory provides only a general rationale for government intervention in science and technology innovation policies. It points out that there are bound to be limitations in introducing specific policy tasks.

For the market failure theory and general equilibrium theory to be established, assumptions that greatly simplify the characteristics of firms and technologies are required. The skills and knowledge defined in the market failure theory are generic and have features that can be coded like information, and they must be immediately usable and immediately productive. Under these technological characteristics, the difference in technological innovation capabilities embodied in companies has no effect. Therefore, there is no policy task for the failure of innovation capability. However, technological innovation and knowledge exist in coding knowledge and embodied technology and expertise. Incorporated technology and knowledge appear as a difference in innovation capability, but market failure theory is regarded as possessing technological innovation capability simply by keeping general knowledge.

In addition, market failure theory does not provide a standard for an appropriate level of actual R&D investment. The proper amount of investment determines a company's investment in science and technology innovation according to the degree of risk, market conditions and future demand, and policy decision-making is possible only when the specific knowledge of the situation and the future technology direction is provided.

The market failure theory suggests why the government should intervene and under what circumstances it should be intervened with a very excellent micro-theory and model. Still, despite its theoretical simplicity and completeness, the market failure theory in most empirical analyses or theoretical explanations, instead of systematising the overall market failure fields and areas, only explains cases of market failure.

National Innovation System Theory

The national innovation system approach is a discussion that emerged in the late 1980s to measure innovation and economic performance in a different way than before. Analysis related to existing science and technology refers to a neoclassical approach that analyses the correlation between R&D investment and the performance of patents and literature, focusing on input and output. There was a limit to measuring a country's innovation capacity or science and technology development potential through such an analysis. Therefore, as an alternative, a system approach that focuses on the actors involved in creating scientific and technological knowledge and the exchanges between them has emerged (OECD, 1997).

In terms of innovation theory trends, it is not easy to see the NIS discussion as academically new. NIS has mainly been based on the OECD model of 1999, and although progress has been made in analytical models and research methods for NIS since then, the basic structure is usually an applied form of the OECD model (An et al., 2019). The OECD's NIS model provides insight that macro-regulation, education, communication and market conditions at the national level are linked to the knowledge production, dissemination and utilization system of science and technology innovation. Institutions formed through the environment or development path create differences in science and technology innovation activities in each country.

Before and after the OECD (1999) model, the NIS research trend has changed in three following stages. At the academic level, the discussion of NIS began as a structural study at the national level, but after the mid-1990s, as the critical point of view on the state-centred approach was strengthened, discussions of technology, sector and regional perspectives emerged alternative discussions. However, it is difficult to say that alternative discussions have replaced the NIS discussion, and it can be said that they supplemented the industrial, regional, and technological, systemic understanding within the NIS. Later, as the global dynamics of innovation was emphasized, research on the relationship between a country's NIS and global knowledge flows increased. These studies are mainly conducted in emerging and developing countries, and they shed new light on the usefulness of discussing innovation systems from a national perspective (Watkins A. et al., 2015).

The concept of an innovation system was first used by Freeman (1987) and defined as a network between public and private sector organisations that undertake activities and interactions to create, absorb, improve, and disseminate new technologies. Edquist (2005) stated that the innovation system refers to the political, economic, and social institutional mechanisms that develop, spread, and utilise innovations in products and processes. In the innovation system theory, researchers greatly influenced by Schumpeter, who viewed innovation activities as the source of long-term economic growth, created the national innovation system theory, which uses the state as the unit of analysis as an alternative to the macroeconomic policy of mainstream economics. (Ku et al., 2012). The system elements include networks, infrastructure, and governance that promote the link between the actors of innovation and the institutional environment at the national level, such as economy, regulation, and market environment. According to Edquist (2005), innovation system theory places innovation and learning processes at the centre of analysis. It also emphasises the interdependence and non-linearity of innovation activities and the role of institutions. However, although the national innovation system theory has emphasised the importance of innovation activities, as globalisation and regionalisation of innovation activities are rapidly advancing, it is affronted that it is not appropriate to use the country as a unit of analysis and that it is only static analysis such as comparing innovation systems between countries. (Ku et al., 2012). In response to these criticisms, the technological innovation system and regional innovation system emerged in the 1990s, and the sectoral innovation system emerged in the 2000s.

A system failure drew a limitation to Innovation creation and diffusion performance (Song et al., 2004). From the perspective of the system failure approach, the government's innovation policy does not promote individual innovation activities but instead creates an institutional environment in which economic innovation activities can be encouraged. In the market failure theory, the government's innovation policy is redistributing resources to companies through R&D funding or tax support. Still, the system-failure approach improves innovation opportunities and innovation capabilities for companies. From the perspective of the innovation system as a whole, the innovation capacity of individual sectors may be low or nonexistent. Thus, the innovation capacity of the entire system may be weakened (Metcalfe, 2005).

The innovation system theory emphasises the transformation and dynamism of the innovation paradigm. Still, it has been pointed out that there is a severe problem in adapting to such change and dynamism at the level of companies and sectors. The innovation system theory found that firms tend to focus on what they know best, prefer technologies and products that match their knowledge and experience, and want to specialise in technologies and products with which they are familiar. Most companies point out that this can lead to very limited technical horizons and perspectives. In this case, companies may have very high competitiveness in the field where their technical knowledge is accumulated but may not have specialised expertise and competitiveness in the area closely related to the field. Therefore, even in the general technological innovation process, there is a problem that it may be challenging to create technological convergence or synergy with closely related fields. In the case of discontinuous technological innovation, almost no response can be made. Even when the speed of such discontinuous technological progress is deficient, companies are known to have serious technical problems. In particular, if a small economy was focused on a specific technology system, such a paradigm shift could pose a severe threat to the entire national economy. These can be called transition failures when transitioning to a new technology paradigm.

Another characteristic of innovation system theory is the concept of path-dependency of technology. The most crucial reason technology shows path dependence is that technological innovation is not limited to just technological innovation but is connected with the innovation system. The process of technological innovation has a network externality effect in close connection with social and economic institutions. Technological innovation is not limited to a company's specialised technology but has been developed with social education and training, financial, infrastructure, and industrial structure. Therefore, the new technological paradigm shift is related to the technological shift and the transformation of the social system. In this case, just as a company experiences failure in transition, the entire industry or innovation system related to a specific technology paradigm can experience failure in the transition process of the technology paradigm. The failure of the whole industry or innovation system in transforming the innovation system because it specialises in the existing technological paradigm is called lock-in failures that appear due to sticking to the existing system.

In addition, the formation of a network between innovation actors and the creation of tacit knowledge can be said to be one of the core concepts in innovation system research. Moreover, unlike neoclassical microeconomics, forming a network is a critical factor in promoting corporate innovation. A company's research capability and research area are ultimately limited, so the interconnection with networks between companies or other innovators such as universities and public research institutes and other organisations is in the positive process of the emergence of new technologies. In addition, the formation of a network is essential because it allows us to form a shared vision for future technological development.

Policy Tools

System failures prevent the innovation system from optimising its operation. Inhibition of innovation activity caused by the lack of a specific factor is relatively easy to discover the cause of the failure and can be alleviated by filling in the deficient factor. On the other hand, it is difficult to find soft institutional factors or network problems that are not well revealed without going through the self-reflection process of the innovators. If it is diagnosed that failure factors are fixed in the system, the task of the innovation policy must be developed to the level of the drastic dismantling of the existing system.

Innovation policy researchers have developed the discussion of Systemic Instrument as a remedy for the six systemic failures as follows. The prescriptions proposed by the system tool theory are broadly divided into five categories. The first is to provide a platform for learning and experimentation by creating a new environment in the problem domain. This prescription aims to provide a new environment and platform to fill the shortage of components in the innovation system or lack of capacity in innovation behaviour. The second is to provide IT infrastructure for strategic intelligence. This method can be used when physical infrastructure utilisation is low, when there is a limitation in knowledge and information about the infrastructure, or when there is a workload and difficulties that hinder innovation activities at the institutional and administrative levels. The third is demand definition and activation of strategy and vision development. If entrepreneurship lacks the capabilities of actors in the innovation system, the performance of the system is bound to below. In this case, it is necessary to define the requirements for innovation behaviour and make efforts to adapt to them. In this case, demand definition, strategy and vision development help innovators discover problems and create new directions for themselves. In addition, the unique culture within the organisation, the social values valued by the organisation, and the widespread customs in society may hinder innovation activities. This problem can be achieved through members' voluntary reflection and organisational culture improvement. Even in this case, developing a strategy and vision at the organisational level can act as a catalyst for change.

The fourth is the organisation and deconstruction of systems (or subsystems). This method is appropriate when the current system and stakeholder interests are firmly bound, and the system fails. If it is difficult to solve the problem with any institutional supplements, it is possible to create a new system that overcomes the system and eliminates the side effects caused by the existing strong network. The deconstruction of the existing system can be suggested in theory, but in reality, it is a prescription that is difficult to implement due to complex interests. Fifth is the management of interfaces. This intermediate area, or contact area, is an area that is increasingly important in innovation system theory, such as the mediation of knowledge creation and utilisation, the mediation between the political and government realms and innovative actors, strengthening of weak links between actors, weakening of solid links. It is a prescription that seeks to optimise the innovation system through It is mainly a measure to manage problems that arise from network failures. (Mierlo et al, 2010)

The paradigm of current innovation policy has shifted away from traditional policy measures such as financial support for members of the innovation system. It has shifted toward requiring policymakers to accurately diagnose system failures and demand a comprehensive systematic approach to resolve them. In response to these government requests, innovation policy researchers have developed an innovation system analysis frame.

Various types of innovation policy tools have been proposed (Edler et al., 2017) to support policymakers, particularly in Europe (European Commission, 2013). Edler differentiates tools by focusing on the supply or demand for innovation. He also considers different innovation policy goals and shows how different innovation policy tools relate to these goals. Many of the 15 major innovation policy tools are related to more than one goal, and many goals are achievable with more than one tool.

Recently, the role of demand for innovation has received more attention at national and regional levels (Edler, 2017). Regulation and standardisation effectively influence both supply and demand conditions and incentives (Blind, 2012). Technology forecasting is an approach for policymakers and stakeholders to understand the future technology trajectory and develop policies to support and benefit from these trends. It will be possible to evaluate how the friendly guidelines that suggest the target fields and usage environments of policy tools for policymakers were applied and achieved results from various perspectives.

Difficulty in Evaluating Innovation Policies

As the uncertainty of the innovation environment increases, the role of the government is not only to compensate for the failure of the innovation system but also to take the lead in solving social problems. Furthermore, strategically leading the development of innovation systems to create innovative results to solve problems is also required. In the case of Korea, with government R&D investment reaching 24 trillion won, it is essential to improve the efficiency of government policies and R&D projects to improve R&D investment performance and create new innovative growth engines.

Since the late 1980s, numerous attempts have been made to evaluate the effectiveness of innovation policy interventions (Edler et al., 2017). However, such an attempt has several limitations. First, while it may be possible to assess the immediate effects of R&D support, such as whether it leads to more R&D performance, assessing the achievement of more comprehensive and comprehensive indicators such as innovation, productivity and jobs, for example, is much more difficult. Difficulties in measuring indicators are also related to the very long lags between innovation and the social and economic impact.

Also, as pointed out above, different policy instruments can interact, making it difficult to distinguish individual effects. This is an 'attribution problem', and it is a question of how much of the measured change in science and technology innovation is viewed as an effect derived from policy (Polt et al., 2006). New innovative product 1 was developed by carrying out technology development project a, but in most cases, and it would not be possible without the help of other complementary technology development projects. In addition, the grouping of these projects can lead to the development of another innovative product with the help of various influencing factors. At this time, it is tough to measure the contribution of technology development projects to improving corporate competitiveness. In particular, since the government's role is not to promote science and technology innovation directly but rather to create a knowledge base and an efficient innovation environment, it is a more difficult task to distinguish the causal effect of a policy.

Moreover, the impact of innovation policy tools depends on the operation of the innovation system to which it is applied. It raises questions about the usefulness of assessments for individual policy tools (Flanagan et al., 2011). Edler et al. (2017) identified more than 700 academic publications and assessment reports that provide evidence for the impact of various innovation policy tools. In general, the immediate effects of innovation policy instruments have been expected in most cases, but the broader effects are uncertain. Ultimately, the difference in context is essential. Even a policy tool with the same design and the same name has very different outcomes at different times and in different countries (Edler et al., 2017).

Thus, the available evidence of innovation policy impact at the national level indicates that a holistic or systematic view is essential in policy (Fagerberg 2016), sensitivity to context is essential (Flanagan and Uyarra, 2016), and that from one national system to another as such, simply mechanically transferring policies can have many problems.

International Experiences with Innovation Systems

The Need for International Comparison

A question to want to know the most through the discussion of the national innovation system is what causes differences in the effectiveness of innovation activities (production and utilisation of new knowledge) between countries. This questioning is also found in Freeman & Soete (1997). Empirical evidence and analysis on R&D and innovation were accumulated in Japan, Europe, and the United States in the 1970s and 1980s, and the success of innovation, the degree of diffusion of innovation, and the related productivity increase were influenced by not only formal R&D but also very diverse influencing factors.

List (1841) points out that individual countries can only increase their productivity by transferring existing knowledge accumulated over generations or increasing their knowledge. He also said that since almost all manufacturing industries cannot but relate to the arts of physics, mechanics, chemistry, mathematics, and design, so without discoveries and inventions in these sciences, most manufacturing cannot be expected. The main concern of List (1841) was how Germany overtake the UK, a technological leader, in the late 19th century. He suggested that the establishment of Germany's optimised technical education and training system was one of the most important reasons.

Freeman & Soete (1997) argues that not only formal R&D investments, but also engineers and technicians and incremental innovations originating from the shop floor, various types of labour organisations, markets and firms, and subcontractors and suppliers of raw materials and services Interactions, professional science-technology system and external linkage, inter-company relationships, and efforts for technology diffusion can also have a significant impact on innovation and are understood as system aspects of innovation. Freeman & Soete (1997) conducted a comparative empirical analysis on the UK and US, Japan and Russia, East Asia (including Korea) and Latin American countries.

An et al. (2019) suggested that a national innovation system is like a set or community of independent individual industrial innovation systems. According to the article, the only thing the state can differentiate and provide to the respective industries that make up the national innovation system is its attractiveness as a habitat for innovators. In principle, the government that governs the habitat can create or provide an attraction as a habitat. Culture and human resources present in a country are important as habitat environments. However, assuming completely open innovation in the ecosystem discussion, it is possible to conceptually exclude variables procured from outside, such as culture and human resources. In other words, It can be said that the country-specific differences in the national innovation system are mainly caused by the attractiveness of the innovation policies provided by each government. The attractiveness of these innovation policies is determined by considering the accumulation of past policies, the current status, and expectations for future policies. Therefore, its innovation policy governance influences the National Innovation System (below, NIS) (An et al., 2019). NIS regards the geographical boundaries of the innovation system as given and attempts to analyse the behavioural patterns of actors, such as companies, universities, public research institutes, and the government, and their linkages included in the innovation process. It is presupposed that these actors share culture, history, language, and political and social institutions within the boundary of "state". In this view, the NIS approach focuses on the state and the government's role.

The form of the ideal NIS is not fixed. NIS appears in various forms depending on the network and cooperation method between the innovation actors, the culture of the country, and the existing system. Even if there is one fixed form, introducing and applying a completely new system from a country to the other is practically challenging due to the path dependence of the innovation policy. Nevertheless, understanding another country's innovation system still can have meanings to have the advantage of finding new implications in the context of that country. This chapter will summarise a few cases with a focus on governance.

Innovation Systems in Countries

US

The US federal government's science and technology innovation policy is beyond the individual department level. It is established and coordinated by the White House Science and Technology Policy Bureau, so it is highly volatile according to the president's will, the highest decision-maker. Governance and budget operation can be changed according to the will of the top decision-maker, as criticised that the participation of the private science and technology community in policy decision-making and advice has decreased since the Trump administration took office. (Oh et al., 2020)

The establishment of major national strategies and policy coordination in science and technology innovation in the US is carried out with the White House Office of Science and Technology Policy (OSTP) centred. OSTP, established in 1976, is an organisation within the White House that cooperates and coordinates with federal agencies, state governments, and the private sector to develop and execute science and technology innovation policies and budgets. In addition, the National Science and Technology Council (NSTC) and the President's Council of Advisors on Science and Technology (PCAST) are operating as major advisory bodies. The president chaired the NSTC and established the federal government's science and technology investment direction and goals, national R&D strategy, and the OSTP serves as the secretariat. PCAST is an advisory group composed of experts from the private sector, co-chaired by the OSTP Director and representatives of private experts. The US federal government research and development (R&D) investment budgeting is a collaboration between OSTP and the Office of Management and Budget (OMB) in the White House. Each August, OSTP and OMB directors announce essential areas of the federal R&D budget.

After the inauguration of President Obama in 2009, the federal government regarded innovation as a driving force for sustainable economic growth and established the "A Strategy for American Innovation", which was combined with the existing R&D investment and innovation ecosystem revitalisation policies (OSTP, 2009). Efforts to link them are continuing. The revised US Innovation Strategy in 2015 attempted to present detailed policy tasks that need to be newly discovered in the future by reflecting the achievements of the innovation policy while inheriting the strategic goals of 2009 (CRS, 2017). In the newly presented "American Innovation Strategy," the federal government's role to distribute innovative outputs and induce sustainable economic growth is defined, and detailed policy tasks are added accordingly.

Germany

In Germany, a cross-ministerial science and technology innovation policy is being promoted to strengthen the link between basic research and innovation and strengthen the accountability of science and technology innovation policies by field. The "Advanced Technology Strategy" in 2006 is established and updated every four years after that.

Germany's research and innovation system is a complex interaction structure between various types of government organisations, private sector research institutes, universities and higher education institutions, and companies. Germany's research and innovation system structure has been maintained without significant changes since the inauguration of Chancellor Merkel, which is an essential factor that enabled the establishment and stable implementation of the "Advanced Technology Strategy". (Seo, 2017)

The federal government and 16 state governments are the central responsible and funding agencies for R&D projects in Germany and carry out R&D projects through collaboration between government organisations or consultations with government advisory bodies. In 2017, the federal government invested a total of 17.1 billion euros in R&D innovation projects, of which about 60% was implemented by the Federal Ministry of Education and Research (BMBF), followed by the Federal Ministry of Economics and Technology (BMWi, 20%) for R&D projects. It plays a key investor role. The combined federal and state budget for 2017 was €15.4 billion, of which the state government finances a third. (Seo, 2017)

Gemeinsame Wissenschaftskonferenz (GWK) coordinates federal and state R&D projects at the highest level and allocates budgets. If the contents of R&D or the facilities required in the process need inter-regional cooperation, they are in charge of making decisions on budget investment and joint infrastructure construction. WR (Wissenschaftsrat, National Science Council) makes recommendations and proposals on the science and technology policy agenda. In addition, the evaluation and planning of existing projects and performance evaluation of public sector science and technology research institutes are performed from a macro perspective of the overall status and prospects of the German science and technology system. The Commission of Experts for Research and Innovation (EFI) provides advice on research and innovation policies to the federal government and prepares and submits an annual report on research and innovation achievements in Germany. It also explores opportunities and threats in the current innovation environment through international comparison and time-series analysis of the German innovation system (Seo, 2017).

Finland

In Finland, starting from the economic crisis of the 1990s, the NIS was introduced, and efforts were made to secure an innovation engine. As the science and technology policy administration organisation, TEKES (Technology Development Agency), under the Ministry of Commerce, Industry and Energy, aimed to revitalise cooperation with academic organisations. Efforts have been made to strengthen the planning and coordination functions of the Science and Technology Policy Council. Among OECD countries, Finland's industry and science and technology network was on the high side, so it was relatively easy to establish open governance. Finland implemented policies such as the Innovation Center program for regional development, the national technology program and industrial cluster program for industry-university-research linkage, and the creation of a science complex. However, It is pointed out that the success of science and technology innovation did not lead to the resolution of social issues due to the tendency of innovation policies pursued by the sector (An et al., 2019).

Sweden

Sweden's national innovation system has high international research performance, rapid application of new technologies, a high education budget, and a preference for resource-intensive industries. Sweden also has the highest R&D expenditure as a percentage of GDP among EU countries. The central institutions of the Swedish national innovation system include NUTEK (Business Development Agency), VINNOVA (Swedish Innovation Agency), and ITPS (Growth Policy Research Institute). NUTEK plays a role in supporting industrial and regional economic development and strengthening networks for economic development. VINNOVA not only supports innovative R&D but also returns R&D results to society and reflects them in the labour market. Sweden's strengths include active exploration of overseas markets, rapid adoption of new technologies, and a flexible research management system (An et al., 2019).

Japan

Although Japan was a leading country that influenced Freeman's concept of the national innovation system, Japan is a unique case of trying to recover the economy through science and technology innovation after experiencing the lost 20 years. Japan's economic growth in the 1980s was characterised by corporate support through active government intervention and policy implementation by individual ministries. However, Japan experienced a crisis due to rapid changes in the economic and social environment. Japan improved the capabilities of the innovators, reorganised systems such as intellectual property rights and tried to strengthen the core control tower function of science and technology policies such as the Comprehensive Science Technology Innovation (CSTI) and supported industry-university-research collaboration so that efforts are being made to establish the governance of the overall innovation system (Hong et al., 2014).

Implications

Each country reflects its unique institutional characteristics and shows differentiated innovation governance structures and characteristics. As a result, how the actual innovation governance is implemented is also showing differences between countries. Still, each country goes through a process of open cooperation with various stakeholders in common, and policy formation is taking place through partnerships that include consultations with key stakeholders and advisory groups at all stages of policy formation. Most of each country's policy-making and coordinating bodies are in the form of committees, and members are also composed at the government-wide or national level. Japan and Finland are composed of the prime minister, ministers of relevant ministries, and representatives of research and industry.

Although the importance of innovation governance is being emphasized in Korea, more efforts are needed in the formation and operation of the policy agenda, overall policy design, and establishment of an organic administrative system. As a top-down policy network centred on administrative bureaucrats and experts still remains strong, it is necessary to refer to the participatory governance that is being tried in Europe in various ways. In addition, in order for the newly launched innovation policy to be effective, the related system needs to be reorganized, and continuous complementary measures are needed to support related work. The design of an innovation policy also includes forming a culture that is hard to change quickly, and it will not be limited to hardware reorganization but will be successful only when software changes such as working methods and organizational culture are supported.

UK's National Innovation System

Governance

The UK, the world's factory in the 18th and 19th centuries, have emphasised the link between scientists and entrepreneurs. The government set up a national scientific institution, invested in transportation infrastructure, and revitalised partnership-type organisations where inventors could secure capital and collaborate with entrepreneurs. It made efforts to protect native technology and achieved remarkable growth by implementing policies to promote industrialisation based on labour productivity twice the European average.

However, since the 2000s, the UK's national innovation capacity has stagnated as excessive fiscal spending, regional economic disparities, and industrial recession continued. The UK government was in a deficit, and business investment was dwindling. The regional gap in the economy has also become so severe that all regions except London had to rely on the input of public resources to maintain the economic level. Stagnation in the manufacturing industry has deepened, and the manufacturing industry's share of GDP fell by half from 20% in 1997 to 12.5% in 2007. (Sung and Park, 2013)

To overcome these difficulties, since 2010, the overall goal of the policy has been to solve the government's financial challenges and, at the same time, build a national economic foundation for growth recovery. It was conducted with an emphasis on forming the foundation for a virtuous cycle of technological development. In addition, the British government has concentrated science and technology-related functions into a small number of ministries through reorganisation. Currently, by integrating related functions into BEIS, consistent policy implementation and smooth policy coordination are possible. (Sung and Park, 2013)

CST

The Council for Science and Technology (CST) is a public body within the UK Government. It provides advice to the Prime Minister, First Minister of Scotland and First Minister of Wales on agendas across government departments. It was founded in 1993, and there was a reorganization in 2003. The committee consists of 17 independent directors and two co-chairs. Before the launch of the CST, the Advisory Committee for Applied Research and Development (ACARD, 1976-1987) and the Scientific and Technological Advisory Committee (ACOST, 1987-1993) served as advisory functions. (Sung and Park, 2013)

BEIS

The UK Science and technology administration system has undergone significant changes. In 2007, the science and technology innovation work of the Ministry of Trade, Industry and Energy (DTI) was independently reorganised into the Department for Innovation, Universities and Skills (DIUS). Department for Business, Enterprise and Regulatory Reform (DBERR) was integrated and reorganised into the Department for Business, Innovation and Skills (BIS). In July 2016, the Department of Energy and Climate Change (DECC) was integrated into the BIS and reorganised into the Department of Business, Energy and Industrial Strategy (BEIS). University and lifelong education-related policies, which were the main tasks of BIS, were separated under the jurisdiction of the Ministry of Education, and BEIS manages R&D, technology, industry, market-related policies and energy-related policies in an integrated manner.

The main tasks of BEIS are (1) establishment of overall industrial strategy, (2) establishment of relationships with companies, (3) advancement of the world-class science base, (4) stable supply of clean energy and (5) response to climate change. The BEIS reform reflects efforts to link the "energy security and climate change response" tasks specified through the DECC with businesses, industries, and innovation. The role of BEIS to improve productivity and innovate public services through the interconnection between emerging new technologies and existing technologies is being emphasised. It suggested the need to establish a joint response to the opportunities of new technologies by strengthening coordination and collaboration between departments and installing a new technology platform that promotes close cooperation between government and businesses.

UKRI

In April 2018, the UK Research and Innovation (UKRI) was newly established. UKRI is an institution that integrates the existing seven research groups, the Technology Strategy Committee, and nine organisations, including Research England. The above seven research groups and the Technology Strategy Committee still have autonomy and authority to carry out activities consistent with the strategies of each organisation. They are responsible for establishing and innovating the system.

The UK Technology Strategy Council (Innovate UK) establishment, under the UKRI, shows that the UK science and technology innovation environment has developed significantly. With a budget of £550 million, the Technology Strategy Council runs a fund that helps the UK's top-notch R&D be commercialised. According to the policy of the Technical Strategy Committee, the Catapult Center was established in 2010. The Catapult Center is an institution that serves as an infrastructure to improve the UK's industry-university link, and currently, nine centres are in operation.

Key Innovation Strategies

Industrial Strategy (2017)

In November 2017, the UK government announced a national strategy to create high-quality, high-wage jobs through investment in future technology, industry and infrastructure and to ensure that all citizens are guaranteed the benefits of these technological changes as the UK Industrial Strategy. It was published in a white paper (BEIS, 2017). Focusing on the 'Five Basics of Productivity', the following five economic policies are proposed to promote productivity. The five policies are an expansion of investment in science and technology and innovation policies, reinforcement of science and technology education, expansion of social infrastructure, improvement of the business environment, and balanced regional development. Through this, the UK government aims to successfully fulfil the four challenges facing the UK: (1) artificial intelligence and data economy, (2) clean growth, (3) future mobility, and (4) an ageing society.

In particular, the UK government has established the Industrial Strategy Council as an independent body in charge of evaluating and monitoring this strategy to ensure that this strategy is continuously and appropriately implemented. While the industrial strategy so far has been partially presented by sector, this strategy announced in 2017 seems to be a very comprehensive and unusual plan in that it dealt with the entire industry based on the UK government's concerns about productivity slowdown.

New Business Regulatory Innovation Strategy (2019)

By the Prime Minister's Council for Science and Technology (CST) recommendations, the UK established the "Ministerial Working Group on Future Regulation" to establish a regulatory innovation strategy for new businesses. Through this, the UK set directions like (1) Facing the future, (2) Focusing on outcomes, (3) Supporting experimentation, (4) Building dialogue, and (5) Improving access, (6) Leading the world. Six regulatory innovation strategies were presented. (BEIS, 2019)

Innovation Strategy (2021)

After leaving the European Union (EU), the UK government has embarked on an innovation strategy to strengthen scientific and research capacity. The government announced that this strategy would solidify the UK's position as a world leader in science, research and innovation. The UK government plans to increase annual public investment in R&D to £22 billion and, by 2027, increase total public and private R&D investment to 2.4% of GDP.

It also reflects a similar EU plan established in Brussels, as the UK did not lose access to Horizon Europe despite its withdrawal from the EU. In addition, this strategy includes a regional innovation revitalisation plan to support target regions by coordinating and concentrating R&D investment in areas of regional strength. The UK government offers a £375 million grant to fast-growing companies looking to raise at least £30 million in investment. The government provides long-term growth capital to innovative technology companies and expects the fund to act as a lever to attract private investment in the research and development (R&D) sector. (BEIS, 2021)

Innovative Performance and Policy Examples

Innovation Performance – EIS Index

The most recent data on the evaluation of innovation systems is the European Innovation Index (EIS). EIS, published annually, provides a comparative assessment of the research and innovation performance of the EU Member States and selected third countries. It contains the relative strengths and weaknesses of their research and innovation systems. It helps in assessing areas where countries should focus their efforts to improve innovation outcomes. Although the UK is no longer a member of the EU, the report also provides data on non-EU countries and includes statistics for the UK.

The EIS 2021 report is published using a revised measurement framework, including new indicators to capture digitalisation and sustainable innovation. Globally, the EU outperforms Brazil, China, India, Russia and South Africa in innovation performance but has a gap in performance with Australia, Canada, Japan, Korea and the United States. Between 2014 and 2021, the EU performed relatively well against its six global competitors. The performance gap with Australia and Canada has narrowed, and the performance advantage has increased over Brazil, India, Russia and South Africa. On the other hand, the EU has a growing performance gap with China, Japan, South Korea and the United States.

The new EIS measurement framework establishes 12 innovation dimensions and 32 different indicators to distinguish four main types of activity. It captures the key drivers of innovation performance outside the enterprise and addresses three innovation dimensions: human resources, attractive research systems, and digitisation. Investment evaluates public and private investment in research and innovation and addresses three aspects: finance and support, corporate investment, and information technology use.

According to the report, the UK's strength lies in its linkages, attractive research systems and human resources. As mentioned earlier, the advantage of loose connections in which each committee operates with autonomy under an integrated research system centred on UKRI can be seen as the superiority of these indicators. The top three indicators are foreign doctoral students, doctoral students, and cooperative SMEs, indicating that immigration policies open to research and effective support policies for SMEs are paying off.

However, the recent decline in innovation performance has been attributed to declining innovation survey data, PCT patent applications, trademark and design applications, and several indicators using environmental technologies. Finally, the UK scored above-average on climate change-related indicators, giving it a positive rating on the new EIS criteria that reflect a sustainable growth perspective. (EC, 2021).

Innovation Policy Case – Innovation Loan Programme

Since 2015, the UK government has been running new financial products to support innovation. In collaboration with the Department for Business, Energy and Industrial Strategy (BEIS) and other partners, Innovate UK is bridging the funding gap for innovative businesses while providing value for money to taxpayers. A new repayable financial product called 'Innovation Loans', a government-funded loan for innovation, was newly introduced to the UK. The Innovation Loan pilot ran over two years, spanning 2018/19 and 2019/20. A total of £50 million was available for business transformation projects, and small and medium-sized enterprises (SMEs) in the UK could borrow between £100,000 and £1 million. In 2019, the pilot period was extended by an additional £25 million.

Innovate UK offers the Innovation Loan Pilot Program, and the selection began in November 2017 and selected companies to benefit sequentially. Loans support small and medium-sized enterprises (SMEs) seeking to scale up by developing new or improved products, processes or services through late-stage research and development (R&D) projects that have a clear path to commercialisation. Innovate UK recently published an evaluation report for this individual program. (SQW, 2019) The main achievements are summarised as follows.

One-third (12 companies) of companies surveyed have introduced new or improved products, services or processes, and 29 companies (76%) have already implemented products/services towards commercialisation. Eleven companies moved from validation and testing to the scale-out phase, and four moved from proof-of-concept to verification/testing. Twenty-five companies appeared to be applying for or planning an IP after using a loan.

Innovation loans increased R&D investment by an average of £414,000. Applying this average to the 17 cases reporting higher R&D spending gives a total increase of £7 million. In addition, the loan has been shown to improve the private sector's ability to finance. The innovation loan served as a guarantee (or 'certification') for investors to help reduce the risk of the project.

Thirty-eight businesses had total employment of 652 at the time of application (average of 17 per business). Still, they had risen to 837 at the time of the interview, and three-quarters (76%) of firms reported employment growth due to loans. All companies expect to hire more people in three years estimated 266 jobs due to loans.

The effect on sales still appeared small. Twenty-four cases provided details on sales, with the highest reported being £4 million and an average of £938,000. In a sample of 38 cases, ten companies reported an increase in sales of a total of £2.8 million through loans.

Innovate UK concludes that 114 additional jobs and an increase of £4 million are expected, considering the changes in employment and sales if no loans are taken into account.

Conversely, interviews were also conducted on companies that did not produce results despite receiving loan support, and the contents are introduced as follows.

There were few alternative sources of funding for failed firms. It shows that innovation loans are injecting additional money into the market. In other words, it is difficult for marginal companies that cannot prove past performance or credit to be selected for innovation loans.

Reflections on the overall program performance are summarised as follows. Demand for these loans is mainly concentrated in London and the southeast, with regional gaps. Also, as the innovation loan was operated as a pilot program, coordination and integration with other existing Innovate UK support programs should be considered. Finally, although the interest rate conditions were very attractive, Innovate UK judged that it would be difficult to sustain them. If interest rates are raised, the success or failure of the program will be again determined by the new conditions.

Korea's National Innovation System

Backgrounds

In Korea, theoretical and policy discussions on NIS were actively conducted in the early and mid-2000s. The discussion of NIS spread not only in Korea but also among OECD member countries from the late 1990s to the early-mid 2000s, and in major European countries such as the UK, Germany, and Finland, NIS was established as a basic viewpoint and framework for each country's science and technology innovation policy. NIS provides a framework for an integrated understanding of R&D policy, the supply side of science and technology innovation, industrial and market policy, the demand side and Innovation policy. Korea also emphasises rationalisation and efficiency and strives for innovative growth to advance NIS through the national R&D innovation plan.

When Korea emerged as a research subject, it was the first stage in developing NIS theory in Korea. Research on Korean NIS in the 1980s and 1990s was popular because Korea emerged as an emerging country based on high-tech industries in the global economic system.

According to Lee et al. (1998), in the late 1990s, Korea's NIS was diagnosed that grew disproportionately due to the development path of selection and concentration. Although the total amount of R&D investment is increasing, most of it has been concentrated in some private conglomerates. In terms of the R&D stage, activities were concentrated in the development field, while the primary research field was weak. Growth in the service sector compared to manufacturing and SMEs compared to large enterprises was insufficient. At the international level, intellectual achievements were insufficient in knowledge creation, and international cooperation for knowledge activities was insufficient. (Lee et al., 1998)

Since 1998, Korea's NIS has made remarkable progress in terms of knowledge creation. The indicators are an increase in investment, an increase in human resources, an increase in basic research, and the publications of papers and patents. On the other hand, the performance of joint research cooperation, knowledge and technology transfer or commercialisation related to knowledge utilisation has improved slightly or is still weak. (Lee et al., 1998) We can infer that the government's policy focus for improving Korea's NIS since 1998 was to promote knowledge creation. Then, how should the recent Korean NIS be assessed, considering the developmental path of the Korean NIS? As in the 1998 report, should we focus on producing and using knowledge or understand it from a different perspective and framework?

Korea's NIS assessment in 1998 can be seen to focus on the functional problem of knowledge production. The policy problem in 1998 was the lack of knowledge output from the subject of scientific and technological innovation. However, at present, the systemic problem of operating the NIS is highlighted as a more critical policy concern than the production of knowledge itself. In short, the Korean NIS assessment framework from a different point of view than in 1998 is needed.

Governance

Central Government

The Ministry of Economy and Finance (MoEF), the Ministry of Science and ICT(MSIT), and the Ministry of Trade, Industry and Energy (MoTIE) establishes the national strategy for innovation and related detailed plans are being pursued. The Ministry of Strategy and Finance is in charge of overall planning. The Ministry of Science and ICT is in charge of science, technology, and R&D policies, and the Ministry of Industry is in charge of industrial policy. Although some of these functions overlap, they usually approach by field according to each role.

In response to changes in the innovation environment, the Ministry of Science and ICT maintains its overall position with the national innovation strategy, especially in science and technology, and promotes related policies and tasks. Therefore, the basic strategy related to national innovation is mainly established and promoted within the basic science and technology plan framework but reflects the overall perspective, including areas other than science and technology, such as strategic technology, creative capacity, and new industry fields.

National and Public Research Institutes

Public research institutes, along with universities and private R&D, form a core part of the national research system, contributing to the production and accumulation of knowledge and economic competitiveness. Public research institutions outside of the university sector have missions that go beyond the conduct of basic research. In Korea, although public research institutes were established in the early 20th century or earlier, there was a significant expansion of public sector research institutes in the latter half of the 20th century (Jang et al., 2006).

After the 1990s, most government ministries started operating their R&D projects, and specialized management agencies were established to manage them. Still, these specialized management institutions became independent, and R&D support of industry-university-research researchers in related fields was extended. As a result, the role of national and public research institutes under the ministries as a national base began to diminish gradually, and overlapping or competing with the ministries' R&D projects occurred frequently. However, the R&D budget used by national and public research institutes has quite a large portion compared to the budget size of R&D projects with external researchers.

Government-funded Research Institutes

In Korea, there are government-funded research institutes apart from national and public research institutes. Government-funded research institutes receive most of the related budget from the government but are specialized research institutes established in private corporations. R&D projects of government-funded research institutes are composed of institutional-specific projects and consigned research projects. Institution-specific projects are supported by the R&D project budget directly from the government and the National Assembly, and related ministries play only an indirect role in this regard. Consigned research projects are supported through external research projects operated by specialized management agencies under each government department. Most of these external research projects are supported by competition with industry and academic researchers in the same field.

The leading role in the specific field can only be performed through an institution-specific project. The consigned research project has no choice but to depend on the direction of the government departments supporting the R&D project, and in most cases, only plays a limited role assigned through the competitive process as a member of one of the industry-university-research institutes.

In 2017, out of the total budget of 25 government-funded research institutes under the Ministry of Science and ICT, the proportion of contributions, including proprietary projects, was 38.8%. The proportion of consigned research projects, including government-consigned and private-consigned research, was 61.3%. The proportion of these contributions varies significantly. For example, while more than 90% of the total budget of the Korea Astronomy and Space Science Institute was contributed publicly, the contribution of the Electronics and Telecommunications Research Institute was less than 20% of the total budget. It means that the roles each government-funded research institute plays in the relevant field may differ depending on the proportion of the contribution. (An et al., 2019).

NIS 2.0

The Korean government strives for innovative growth by emphasizing rationalization and efficiency to advance NIS through the national R&D innovation plan. NIS, which each regime has promoted, differs depending on the goals of regimes, but in a broad sense, it can be the means for realizing policy goals such as economy, society, culture, and institutions. Environmental factors surrounding the goals and means are all taken into consideration.

Most of the science and technology policies discussed and the current government (Moon Jae-in government)'s NIS 2.0 are aimed at science and technology innovation. Since the 2000s, it has shifted away from the view that research results obtained through R&D activities can only solve social problems by creating high added value that changes industrial sites. Direct and indirect factors participating in R&D activities for innovation have become more diverse than before, and the actors participating in developing social problems into policy problems are increasing to the state, region, civic groups, and individuals. In other words, based on the innovative research that started to understand the role of policy in analyzing economic and social changes, it is necessary to approach science and technology policy from various perspectives, such as a new technology perspective, a transition and a three-dimensional perspective.

This chapter reviews the NIS of the Roh Moo-hyun administration, which first introduced the concept of NIS into policy and the NIS 2.0 of the Moon Jae-in administration. First of all, the NIS of the Roh Moo-hyun government refers to a network that raises competitiveness by spreading and industrializing innovations. In such a system, finding a new way for the whole country by innovating through the qualitative improvement of microeconomics such as science, technology, industry, and human resources is a more fundamental way to revitalize the macroeconomy.

Key factors include: (1) a company's technological innovation capabilities, government support systems and policies to strengthen them, (2) networks and mutual learning among innovation actors, (3) structural and institutional mechanisms to spread and industrialize innovation outcomes, and (4) science and technology. It is integrated coordination of technological innovation, industry, human resources policies, and linkage with society and economy.

The innovation framework of the Moon Jae-in government refers to the advancement of the national innovation system, such as human resources training, commercialization, regulation, industry, finance, and education, as well as R&D, in order to achieve scientific and technology-based innovative growth and to improve the quality of life of the people. The innovation model reflects changes in the new environment, such as the advent of the 4th industrial revolution and increasing demands for quality of life. In other words, NIS 2.0, which developed and upgraded the NIS model proposed by the former government by reflecting new policy demands, was presented. In addition, it emphasizes the importance of the role of public research institutes for balanced regional development and social value creation by supplementing previously insufficient areas such as quality of life and public participation.

Based on NIS 2.0, the government's coordination system was upgraded in stages with the Ministry of Science and ICT as the centre. They established the "National R&D Innovation Plan", focusing on the R&D support system, innovation agent capacity, and innovative performance areas. Later, together with relevant ministries, they prepare individual strategies to advance innovation capabilities in each field, such as SME industry-university-research cooperation. It can be a transition to a strategic cross-ministerial response system to spread R&D achievements throughout the economy and society.

The main contents of the National Science and Technology Innovation Model (NIS 2.0) include (1) R&D support system innovation centred on researchers, (2) Enhancing the capacity of innovation agents in the industry, academia, and research areas, (3) fostering innovative growth engines, and (4) creating achievements that people feel, such as solving problems in people's lives (Ha et al., 2019).

Key Innovation Strategies

The Korean government has established mid-to-long-term scientific and technological innovation development plans and has been vigorously implementing them. The 1st Five-Year Technology Promotion Plan (1962-1966) was the first, followed by the 2nd 5-Year Science and Technology Promotion Plan (1967-1971) to the 6th Five-Year Economic Development Plan: Science and Technology Sector Plan (1987 to 1991). Moreover, after the 7th S&T Sector Plan, it has the function of indicative planning, and in particular, the new government's ideology and core policies were projected onto the S&T Sector Plan. The 7th Science and Technology Sector Plan, established initially, was adjusted to the New Economic Five-Year Plan: Technology Development Strategic Plan (1993~1997) promoted by the Kim Young-Sam government, and after that, the Kim Dae-Jung government's Five-Year Plan for Science and Technology Innovation (1997~2002) and the Five-Year Modified Plan for Science and Technology Innovation (2000-2002) followed.

Even in the 21st century, each regime continued to establish mid-term plans that contained their philosophies. In this regard, the Ro mu-hyun Government's 1st Basic Science and Technology Plan (2003~2007) and the 2nd Basic Science and Technology Plan of the Lee Myung-bak Administration (2008~2012) were established. In addition, the 3rd Basic Science and Technology Plan of the Park Geun-hye government (2013-2017) and the 4th Basic Science and Technology Plan of the Moon Jae-in government (2018-2022) were established one after another. On the other hand, plans were also established to develop science and technology innovation, and a long-term vision for science and technology development towards 2025 (2000-2025) was established. What is noteworthy here is that, in establishing the development plan for these scientific and technological innovations, the critical policies of science and technology innovation were closely linked with major economic policies in line with the mid-to-long-term plans for economic development. Moreover, through these mid-to-long-term plans, the future development path of science and technology innovation, mid-to-long-term vision, goals to be achieved, strategic fields, critical areas and core technologies, key promotion strategies, essential policy tasks, and action plans were established and implemented (Ha et al., 2019).

Evaluation

OECD Report

The OECD (2014) report pointed out that although Korea's innovation system has developed a lot, there are still challenges for continuous innovation and economic growth. Among them, the following four are the most important. (1) Establishment of a systematic and effective R&D evaluation system (2) Commercialization of public R&D (3) Start-up and revitalization of SMEs (4) Balanced development of manufacturing and service industries.

First, OECD 2014 report emphasized that a systematic and effective R&D evaluation system must be established. As mentioned above, the R&D evaluation system needs to be improved to solve the country's R&D, which is concentrated on manufacturing, insufficient cooperative activities among research subjects, and low R&D efficiency. Although the OECD report judged that the overall evaluation system in Korea was well developed, it pointed out some areas for improvement. For example, the current evaluation system tends to place too much importance on the transparent use of R&D costs. Also, they point out that Korea's evaluation system is too focused on short-term goals and that the long-term effects that R&D can bring are not adequately evaluated because it is biased toward short-term results.

Second, it says that the commercialization of public R&D is essential. Regarding the insufficient technology commercialization of Korea's public R&D, the OECD report analyzed that although Korea is making various efforts to commercialize public R&D, such as enacting the 'Technology Transfer Promotion Act' in 2000, there are still areas for improvement. For example, it advises that research exchanges between SMEs and universities should be more active and that active research exchanges require policy support and a change in cultural perception on industry-university cooperation. In addition, it advises that the commercialization of university research should be further promoted. For this purpose, he analyzed that it is necessary to allocate a separate R&D budget for the commercialization of research and establish a business-friendly research environment. In addition, it emphasizes that research exchanges between public research institutes and SMEs should be further activated for the active commercialization of public research. The ratio of the Korean government's R&D to corporate investment is 3%, which is far insufficient compared to other countries. As one of the methods for active research activities of public research institutes and SMEs, it advised that a part of public research institutes should be replaced with research institutes operated mainly on research contracts with companies.

Third, the report analyzes that Korea's policies to support start-ups and SMEs should be more active. According to the report, various policies and support programs for start-ups exist in Korea, but start-up activities are not active. For example, Total Entrepreneurial Activity (TEA), which shows the percentage of people who want to start a business, is 7% in Korea, which is lower than in the US (13%) and Singapore (12%). The report says that one of the most important things to promote entrepreneurship is to improve the framework conditions for it. All conditions for start-up include a guarantee of competition in the market, conditions of tax benefits for companies, sufficient human resources supply, and good infrastructure. The report advises that, in addition to improving all conditions, the government's expansion of start-up support facilities (support for entering foreign markets, support for growth-oriented business), accurate evaluation of business incubators, support for young entrepreneurs, and data-based business support are essential. As mentioned earlier, the OECD 2014 report also says that the service sector must be developed to be competitive in the global environment in this era. However, it pointed out that the development of the service sector in Korea is insufficient. For example, productivity in the service sector is the lowest among OECD countries, and the service sector's share of total GDP is also low. In addition, the proportion of R&D investment in the service sector is much lower than that of the manufacturing sector. In order to revitalize the service sector, it advised that various conditions must be met, such as flexibility in the labour market, competition in the market, and free international trade of services.

STEPI Report

The areas to be improved in Korea's innovation system presented in STEPI's 2012 report (Shin, 2012) are not very different from those of OECD 2014. Here, except for duplicates, they are reviewed.

First, it advised that innovation capabilities should be developed in a balanced way among innovators. In particular, large corporations and SMEs, metropolitan universities and local universities, private research institutes and government institutes should have innovative capabilities similarly. It also emphasized active linkage activities between innovation actors. In particular, it emphasized that it is of utmost importance to increase linkage activities between SMEs and public research institutes (funded research institutes and universities) to enhance the dynamic capabilities of the Korean innovation system. Second, it advised that venture start-ups based on science and technology innovation should be revitalized to find new growth engines. Finally, it suggested that the role of the government needs to be re-examined. It analyzed that conventional market intervention and the government's unilateral policy promotion should be avoided, and the market's voice should be listened to.

Implications – Comparison with the UK

First, it is an organic linkage and integration effort between related policies based on scientific and technological innovation in a broad meaning. The UK is actively trying to solve various economic and social problems in science and technology innovation by linking related policies such as support for start-up and industrial innovation, regulatory reform, intellectual property rights, and vocational education. It is similar to Korea, which is trying to create new growth engines, markets, and jobs through economic operation based on science and technology through the establishment of the Ministry of Science and ICT. It is worth noting that, for this purpose, the UK has made efforts to link science and technology innovation and related industries and to link and integrate science and technology with economic, social, welfare, and cultural policies through specific strategies and detailed projects, except for basic science that requires long-term investment. Now, Korea also needs to develop strategies and programmes for innovation policies that consider both growth and welfare in line with the trend of innovative growth. It is necessary to discover and link various policies and systems that consider all aspects of society, such as humanities, culture, arts, and existing innovative fields such as science and technology, ICT, and industry. At the same time, stepping stones and follow-up projects that lead innovation outcomes to new industries, jobs, and welfare should be activated.

Second, it is a consideration of the extensive ministry system. BEIS in the UK adopts a multi-ministerial system that integrates innovation policy coordination issues across multiple ministries into a single ministry. The extensive ministry system has the advantage of reducing the burden in the coordination process by internalizing the inter-ministerial coordination problem. However, it can fail to create synergy through the parallel organization without chemical fusion or imbalance the ministries' capabilities in specific functions and fields. The Ministry of Science and ICT is also prone to alienating future-oriented science and technology issues when functions are mechanically and parallelly combined around economic and industrial issues that emphasize short-term performance. In order to prevent this, the most crucial task is to establish the role and function of the Ministry of Science and ICT as a central body that will drive innovative growth. The planning and coordination capabilities of the Ministry of Science and ICT must be strengthened to create a new industry that has never existed before by linking convergence technology with services, art, content, and media, away from R&D planning and execution in the narrow sense. Above all, to create practical synergies in the IT application industry, which deals with long-term R&D and current issues simultaneously, detailed organizational design and differentiated strategies should be established in consideration of the characteristics of each field.

Third, in order for knowledge and creativity, which are critical elements of innovative growth, to lead to R&D, start-up, and industry to simultaneously create economic and social outcomes, the laws and systems that support this, along with linkage and cooperation between ministries in charge and research subjects, In addition, a primary environment for regulations and systems should be established. It is not possible through a piecemeal reorganization of the administrative system but requires an integrated reorganization of the entire social, economic, innovation, and policy system, including the actual way of working. Therefore, cooperation between the MSIT and the MoTIE, the ministries in innovation and industry, should be strengthened. The linkage is needed between the ministries that require technology such as health and welfare, construction and transportation, and disaster prevention and safety. In addition, institutions and programmes should be expanded to facilitate the exchange of people, knowledge, and information between industry, academia, and research and to promote the joint use and commercialization of developed technologies.

Fourth, the UK prepared a preemptive regulatory innovation strategy for new industries in its infancy and established regulatory innovation governance in cooperation with the Regulatory Horizons Council, a private advisory body, and across ministries. On the other hand, Korea tends to focus more on discovering and resolving pending regulations than on regulatory innovation for future new businesses. In addition, there is a need for policy linkage between the 4th Industrial Revolution Committee and the Regulatory Reform Committee, which are the control towers of 'new industrial policy' and 'regulatory policy'. Governance is an essential function for the effective operation of the innovation system, so it will be necessary to think about it.

Conclusion

This article reviewed the theoretical flow of the national innovation system and derived implications for establishing Korea's national innovation system 2.0 by comparing the innovation systems of major countries.

First, summarizing the concepts used in this article, 'innovation' means applying new technology to a specific process or product and depends on the social and environmental conditions that enable innovation and the social and environmental needs for innovation. 'Innovation policy' refers to all kinds of government intervention to create and spread innovation. It implies the possibility of government intervention in a wide range of R&D activities from basic research to development research and broadens the scope of government intervention in all conditions related to science and technology activities, such as financial investment, education, and market environment.

The theoretical basis for innovation policy has been developed into a mission-oriented approach, market failure theory, and innovation system theory. The traditional concept of mission-oriented policy is government-led R&D and innovation to achieve a specific national mission. However, the mission-oriented approach is different from the macroscopic and long-term approaches and has limitations in establishing a separate theory.

Market failure theory is based on traditional microeconomics, and the discussion of market failure has great significance in that it theoretically provided the basis for government policy intervention in science and technology innovation. The field of science and technology innovation has also been pointed out as one area that requires government policy intervention, and it can be said that it has been given justification for the intervention of science and technology policy since the 1960s. Despite various theoretical advantages, the market failure theory exposed its limitations in that it does not give a realistic answer in practical application. Nevertheless, it still has implications for the legitimacy of the government's intervention grounds and regulatory policies in specific fields (industries where natural monopoly and externalities occur).

The national innovation system theory emerged to measure innovation and performance differently from the market failure theory. It is an approach that focuses on the actors involved in creating scientific and technological knowledge and the exchanges between them. It also explains the rationale for government intervention in the event of system failure. From the perspective of system failure theory, the government's innovation policy does not promote individual innovation activities but instead creates an institutional environment in which economic innovation activities can be promoted. A system approach to technological innovation has been proposed since the late 1980s, and countries worldwide have established and implemented science and technology policies based on this. Currently, Korea's industrial and science and technology policies are also based on the national innovation system.

Many theoretical approaches have been made on how the performance of these innovation policies should be measured. However, it is not easy to find a clear answer to this. It is important to note that the available evidence of the impact of innovation policies at the national level should be viewed from a holistic or systematic perspective in policy, contextualized, and simple policy transfers should be avoided.

An essential question in the national innovation system is why there are differences between countries in the effectiveness of innovation activities (production and utilization of new knowledge). The nation can differentiate and provide the individual industries constituting the national innovation system is the attractiveness as a habitat for innovators, and the government can create or provide it. The differences between countries in the national innovation system can be determined by the attractiveness of the innovation policies provided by each government. Therefore, the National Innovation System (NIS) can be similar to the government's innovation policy governance. In this sense, the NIS approach focuses on the nation's role, the government.

Accordingly, due to understanding the status of innovation systems in major countries, the following implications were found. Each country shows a differentiated innovation governance structure and characteristics by reflecting its unique institutional characteristics. However, it undergoes cooperation with various stakeholders and consultation with key stakeholders and advisory groups at all stages of policy formation. Policy formation occurs through partnerships that include most of the policy-making and coordinating bodies of each country. The form of committees and members are also composed at the government-wide or national level. Finland's system includes the prime minister, ministers of relevant ministries, representatives of academia and industry and even the labour area.

In particular, the following implications could be found in the UK innovation system. First, it is an organic linkage and integration effort between related policies based on scientific and technological innovation in a broad meaning. The UK is actively trying to solve various economic and social problems in science and technology innovation by linking related policies such as support for start-up and industrial innovation, regulatory reform, intellectual property rights, and vocational education. It is necessary to discover and link various policies and systems that consider all aspects of society, such as humanities, culture, arts, and existing innovation fields such as science and technology, ICT, and industry.

Second, it is a consideration of the major government system. BEIS in the UK adopts a multi-ministerial system that integrates innovation policy coordination issues across multiple ministries into a single ministry. The most important task is to establish the role and function of the Ministry of Science, Technology and Information and Communication as a central body that will lead innovative growth. The planning and coordination capabilities of the Ministry of Science and ICT should be strengthened to create a new industry that did not exist before by linking convergence technology with services, art, content, and media, away from R&D planning and execution in the narrow sense. Above all, to create practical synergies in the IT application industry, which deals with long-term R&D and current issues simultaneously, detailed organizational design and differentiated strategies should be established in consideration of the characteristics of each field.

Third, in order for knowledge and creativity, which are critical elements of innovative growth, to lead to R&D, start-up, and industry to simultaneously create economic and social outcomes, the laws and systems that support this, along with linkage and cooperation between ministries in charge and research subjects, In addition, an environment for regulations and systems should be established. It is not possible through a piecemeal reorganization of the administrative system but requires an integrated reorganization of the entire social, economic, innovation, and policy system, including the actual way of working. To this end, the linkage between the ministries that require technology should be strengthened. Institutions and programs should be expanded to facilitate the exchange of people, knowledge, and information between industry, academia, and research and promote joint use and commercialization of developed technologies.

Fourth, the UK prepared a preemptive regulatory innovation strategy for new industries in its infancy and established regulatory innovation governance in cooperation with the Regulatory Horizons Council, a private advisory body, and across ministries. On the other hand, Korea tends to focus more on discovering and resolving pending regulations than on regulatory innovation for future new businesses. For the effective operation of the innovation system, it is also necessary to consider adjusting governance for regulatory innovation.

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3. 영국의 스케일업 지원정책 및 한국 정책에의 함의

(Comparison of UK Scale-up Support Policy with Korea and Implications to Korean Government)

Introduction

Scale-up refers to a company that grows rapidly in sales and employment in a short period. OECD has defined 'scale-up' as a company that has increased annual sales or employment by 20% or more over the past three years, among companies with ten or more employees (OECD, 2008). As seen in the cases of rapid corporate value growth of most global unicorn companies, scale-up is an essential step in determining the success or failure of a unicorn company.

Scale-up drives national economic growth in terms of job creation. Scale-up companies outperform the average of all companies in terms of performance and growth rate. In the US, scale-up, accounting for 5%, created 33% of new employment (Kauffman Foundation, 2010), and in the UK, scale-up of 6% created 54% of new employment (NESTA, 2009). In the case of Korea, scale-up also shows higher performance than general companies in terms of employment, sales, and exports and is more active in innovation activities (Kim, H., 2019).

It is challenging for a company to sustain high growth continuously. In particular, the scale-up company group has more active entry and exit than other companies, so it is necessary to monitor the trend change continuously. In the case of Sweden, less than a quarter (22.5%) of the companies experienced high growth twice in a row. (Kim, S., 2019b)

Accordingly, major countries such as the United States and the United Kingdom have shifted from a startup-oriented policy to a scale-up policy since 2010 and are promoting policies for the growth of start-ups. The US launched the ScaleUp America Initiative, a policy to support the growth of small and medium-sized enterprises (SMEs), in July 2014. The UK government established the world's first scale-up institution, ScaleUp Institute, in 2014 to provide scale-up company information search service and scale-up target matching service and is already actively supporting scale-up policies.

In Korea, pan-government efforts to revitalise start-ups generate quantitative results, such as increasing the number of venture companies and angel investment. However, the survival rate of domestic start-ups is 62.7% after one year and 27.5% after five years. The proportion of scale-up companies was 8.9% in 2018, significantly reduced from 13.4% in 2010, and is located at the bottom of the OECD's major countries. Sales and the number of companies decreased by -0.3%, and the proportion within the entire company did -4.2% per year (Kim, S. et al., 2020).

Nevertheless, the Korean government's policy is focused on nurturing start-ups (more than 70% support) (Hong, D. and Jun, B., 2019). It has been pointed out that the Korean industrial structure has become deformed without a back because the government's start-up funds have been concentrated on new start-ups within three years, and the need for scale-up support has been raised to that extent.

Accordingly, in Korea's start-up support policy, scale-up has become a hot keyword in the transition from start-up to scale-up. In March 2019, the Korean government announced that it would support scale-up by creating a large-scale dedicated fund to create an investment of 12 trillion won over the next four years and proposed to increase the number of unicorn companies to 20 by 2020. In addition, the government announced that it would change the government policy, which was focused on supporting the initial stage of start-ups, and create a 'preliminary unicorn special guarantee' system to focus on step-by-step scale-up (MSS, 2019). The financial sector also shows interest in scale-up investment in line with this. However, it is still a small-scale policy centred on financial support, so it is time to consider policy expansion and refinement.

The UK is a leading country in adopting "scale-up fostering" in its economic policy. Since 2016, 'Department for Business, Energy and Industrial Strategy (Referred as to BEIS)' has led the scale-up support and has actively identified the actual situation by using the public data held by 'Companies House' and the 'Revenue and Customs' (Kim, S. and Jin, W., 2020).

In 2014, the ScaleUp Institute, the world's first institution dedicated to fostering scale-up, was established. It intends to create an environment that promotes high growth and sustainable growth by supporting start-ups and growth in the UK. It supports scale-up by providing programs centred on education, information sharing, and networking. A representative program is 'Careers and Enterprise Company (CEC)' in the field of talent education and nurturing, which builds a local network that connects businesses and schools (mentor/financial support for CEOs), and 'Entrepreneurs Forum: Scale-up Leaders Academy, which runs a leadership training academy for ten months including coaching for start-up CEOs. In funding expansion, the 'ELITE program' operates a platform to help attract investment by forming a community between companies/professionals/investors. In infrastructure construction, founders like' Google Campus London' provide residential space and networking programs. In 2018, 2,217 scale-up companies achieved an investment of $39.5B, paying off. (IITP, 2018)

This report seeks to find implications for Korea's scale-up policy by referring to the case of the United Kingdom. The importance of financial support for corporate growth has been confirmed through existing studies, cases, and surveys. However, various policy supports are likely to be needed to scale up effectively. This report analyses the UK scale-up support policy that has already been introduced and will show the scale-up policy to overcome this limitation.

Policy Backgrounds

What is “Scale-up”?

Scale-up refers to a company growing rapidly in a short period in terms of sales and employment and is called scale-up, high-growth firms, and gazelle firms at home and abroad. The term 'scale-up' itself was generalised by Sherry Coutu in the UK, but the criteria for judging scale-up are defined in various aspects by various organisations (Kim, S. and Jin, W., 2020).

According to OECD (2008), scale-up refers to a company that has increased annual sales or employment by 20% or more over the past three years among companies with ten or more employees.

According to NESTA (2013), it is a company with ten or more employees and has recorded an average annual employment growth rate of 20% or more for the past three years.

According to the EU (EC, 2016), scale-up refers to a company that has attracted more than $1 million in investment since its establishment. A company that has attracted more than $1 million in investment since its establishment is called a scaler, and a company that has attracted more than $1 billion in investment is called a super scaler.

The UK ScaleUp Institute (2014) classifies scale-up by subdividing the company's sales volume, growth rate section, and the number of employees. The sales scale is divided into five sections, from the lowest of 1~2 million pounds to the highest over 50 million pounds, and the growth rate is divided into a total of 4 sections from 20~30% to over 50%, and the number of employees is from 10~14 people to 100 people. It is divided into five sections up to the above.

Looking at the above definition, the definition, conditions, and name of scale-up are used differently for each country or institution, but the focus is on 'high growth' in common. Although many countries emphasise the importance of start-ups, the real contributors to economic growth are fast-growing incumbents; It is a scale-up (Kim, S. and Jin, W., 2020). Countries with high economic levels (GDP) have a low proportion of the self-employed, start-ups, small businesses tend to be active in countries with high unemployment rates. It is worth noting that early-stage entrepreneurship in major advanced countries such as the United States, Switzerland, and Germany, or the proportion of small enterprises to the total number of enterprises is relatively low compared to other countries (SBA, 2014). It seems a natural result that interest in scale-up is growing since simply appearing more entrepreneurial activities does not lead to the conclusion that it is favourable for economic growth.

Why do we have to focus on “Scale up?”

The Korean government has paid great attention to economic growth and job creation and has supported startup revitalisation policies from various angles. It is no exaggeration to say that actual economic growth and job creation depend on the growth after business establishment. Isenberg (2017) said that 'new growth' should be pursued through 'new firms.'

Scale-up is contributing significantly to national economic development

According to a Kaufman Foundation survey (2010), in the United States, a 5% scale-up creates two-thirds of new employment (KIAT, 2018). In the UK, a 6% scale-up created 54% of new employment (NESTA, 2013).

In Korea, scale-up also performs higher than the average of SMEs in terms of employment, sales, and exports (MSS, 2018). The average employment of Korean scale-ups increased by 48% from 33 in 2012 to 49 in 2015, and sales also increased by 151% per company from 5.72 billion won in 2012 to 14.37 billion won in 2015. The average export value per company increased by 195% from KRW 2 billion in 2012 to KRW 5.92 billion in 2015.

Kim, H. (2019) presented a study showing that scale-up exhibits more dynamic characteristics in innovation activities than general companies. The proportion of R&D human resources in scale-up is higher than in general companies. According to Kim, scale-up is significantly higher than general companies in terms of R&D human resources among R&D human resources and R&D investment, generally known as factors affecting innovation performance. Kim argues that scale-up is more innovation-oriented than general enterprises. When comparing innovations by four types (product innovation, process innovation, organisational innovation, and marketing innovation), scale-up achieved more innovation than general companies in terms of three innovation types (product innovation, process innovation, organisational innovation) excluding marketing innovation. In particular, scale-up cooperates with other companies and organisations regarding product and process innovation.

Why is scale-up monitoring necessary in Korea?

It is challenging for a company to sustain high growth continuously. In particular, it is necessary to continuously monitor the trend change because the scale-up company group shows more active entry and exit than other company groups. In the case of Sweden, only less than a quarter (22.5%) of the companies that experienced high growth was found twice in a row (Kim, S., 2019)

In the case of scale-up in Korea, the number of firms tends to increase (based on employment), but the annual growth rate of the total firms is declining (Kim, S. et al., 2020). In terms of sales, the number of companies decreased by -0.3% per year, and the proportion within total companies was -4.2% per year, both in number and proportion. In terms of employment (full-time workers), the number of companies increased by 2.33%, but the proportion in total companies decreased to -1.7%. The annual volatility of companies is also high in terms of the number of companies (8.4%) and the proportion of companies (8.2%) in terms of sales and employment.

In addition, the scale-up characteristic in Korea is characterised by high density in the metropolitan area. In terms of sales, 56.3% of domestic scale-ups are distributed in the metropolitan area. Next, Gyeongnam 13.9%, Chungcheong was 9.9%, Gyeongbuk 8.7%, Jeolla was 7.9%. In most regions of Korea, the growth rate of scale-up shows a downward trend. From the point of view of regional innovation, it is crucial to attract and settle scale-up in the region, so continuous monitoring of scale-up companies will be required (Kim, S. et al., 2021).

In Korea, monitoring and management functions for scale-up companies are entirely in their infancy, and even consistent and continuous statistics on this are lacking. Since the target of support is not specified, it is difficult to intensively support the scale-up candidates even in the corporate support policy, which leads to a problem in that it is difficult to increase the efficiency of the policy. Therefore, this report intends to discuss securing a monitoring system for scale-up companies, establishing consistent governance for scale-up companies, and expanding the volume of scale-up companies in business support policies.

Previous Research

The term scale-up is a practical term used relatively more in the OECD and UK than in the US. In particular, in 2003, the OECD led the scale-up discourse, emphasising the importance of sustainable growth after business establishment in terms of job creation effect. Member governments have encouraged interest and investment in 'scale-up ecosystem development' in quality economic development (OECD, 2018).

In the UK, interest at the private level is very high. The UK's leading financial firm, Barclays, has created a report called' Scaleup UK' proposed to the government in collaboration with the University of Cambridge and the University of Oxford Business School. It has been suggested that 12 conditions are necessary to establish an effective scale-up ecosystem for economic development in the UK (Hellmann & Kavadias, 2016).

Since the publication of the '2014 Scale-Up Report', 'The ScaleUp Institute', a non-profit private organisation in the UK, has been actively conducting activities to diagnose the UK's Scaleup ecosystem and seek development directions every year.

The United States is interested in scale-up from the perspective of state and local economic development rather than the federal level. One of the best examples is the 'Scale Up Milwaukee' initiative in Milwaukee, Wisconsin (Isenberg & Onyemah, 2016). Daniel Isenberg and Vincent Onyemah, who are actively dealing with entrepreneurship and the scale-up ecosystem based at Babson College in the United States, introduced scale-up as a basic concept that 'Scaleup means a company that is continuously and greatly growing'.

Scale-up is being actively dealt with at the level of international organisations, the private sector, and the government. Unlike the trend that is being emphasised, especially in terms of the effectiveness of job creation, academia does not clearly define a conceptual definition for it. Although it has already been dealt with as a critical issue from a practical point of view, studies to support it from a theoretical point of view are still very scarce.

Regarding the concept of scale-up, most of the previous studies and data use sales growth and employment growth as the criteria for scale-up. Achtenhagen et al. (2010) viewed job creation, sales growth rate, corporate value growth, and sales of new markets and new products and services as measurement factors for corporate growth.

The next thing to pay attention to is the process of startups being scale-up and the factors that determine it.

In the UK, Barclaycard has summarised ten phenomena that occur in the process of startups growing into scale-ups. 1) relocation to bigger offices, 2) rapid increase in consumers, 3) launching new websites, 4) launching social media, 5) investing in consumer experience rather than the product itself, 6) forming overseas business relationships, 7) as business relationships grow Introducing a more reliable transaction system, 8) Working like a financial expert, 9) Hiring an HR consultant and retaining top talent, 10) Using a new logo to change the brand image.

Isenberg (2017) suggested six areas of the scale-up ecosystem: finance, market, talent, support, culture, and policy. In detail, it is divided into 12 categories: financial capital, initial customers, networks, labour, educational institutions, infrastructure, supported occupations, non-governmental organisations, success stories, social norms, leadership, and government. Because actors (stakeholders) in each domain set and act with different goals, imposing a single goal is not desirable or even possible. Each domain has a Mutual Causality, and Connected Interacting takes place rather than one domain dominating or dominating another. Therefore, an approach different from the existing startup ecosystem is required to foster scale-up. Companies with potential for scale-up and the environment that supports scale-up will be critical. Eisenberg also summarises the requirements that must and must not be met to develop the entrepreneurship ecosystem.

Recently, Lee et al. (2020) and Lee & Oh (2021) applied the 'ERIS model' and the 'SCP paradigm' to examine the drivers of corporate growth considering both internal and external factors. Lee et al. (2020) identified factors affecting the valuation of 479 'Global Unicorn Club' companies in 2019 based on the 'ERIS model (entrepreneur, resource, industry (market), strategy)', whereas Lee & Oh (2021) analysed 333 'super-growth' companies of 'Inc.'. These are among 'The 5,000 fastest-growing private companies in the United States' with more than $100 million annual sales.

For unicorn companies, Lee et al. (2020) found that entrepreneurs' 'STEM education' background and firms' Organic' and 'Global' strategy choices positively affected valuation at a statistically significant level. It also suggests that the higher the level of 'funds' of investors and the higher the level of 'business easiness' of the country in which they operate, the higher the value evaluation and the negative relationship of the 'co-founder' variable with the dependent variable. Similarly, in Lee & Oh (2021) 's super-growth companies, variables that contribute to business easiness and access to skilled labour have significant interaction with independent variables. 'Science graduate', 'corporate tax index' and 'R&D expenditure rate' have a significant moderating effect on the relationship between strategic variables and revenue CAGR.

Finally, the study of Piaskowska et al. (2021) focuses on factors that prevent startups from scaling up. They try to explain this with the Penrosean theory (Penrose, 1995). As a company grows, a specific path or restriction occurs in utilising internal resources for growth activities, which acts as a kind of cost to manage the growth process. As a model to overcome this, they are analysing support activities for a company to scale up with a digital business model. A cluster analysis was performed on 185 unicorn companies, divided into network scaler, centralised scaler, organic scaler, and limited scaler. Network scalers tend to prioritise digitisation activities, and organic scalers emphasise innovation. Concentrated scalers have developed products for specific markets or industry segments by prioritising high-quality technology. The constrained scaler had a relatively limited ability to acquire financial and human resources to facilitate growth-enablement activities and had the slowest growth rate of the four expansion modes identified in the sample. This study has implications for scale-up policies in the era of digital transformation.

UK’s Scale-up Support System

Scale-ups in the UK: A Leading Country supporting Scale-up

According to the ScaleUp Institute (2021), there are 33,445 scale-ups as of 2019, and it is a 24% increase compared to 2013. Early signs from Companies House's initial review of 16,830 company monitoring, burgeoning sectoral clusters and the ScaleUp Index are encouraging, with a turnover of £10.2m and more scale-up to break through the £5.1 million asset level.

Scale-up accounts for a large portion of the total sales of SMEs. At the national level, scale-up was found to continue to contribute to the national economy significantly. As of 2018, Scale-up employed a total of 3.5 million people and generated sales of £1 trillion, with an average turnover of £295,000 per worker. According to ONS, small business sales were estimated at £2 trillion in the same year. Scale-up accounted for 0.6% of the total 5.7 million SMEs, but it was found that the scale-up accounted for close to 50% of the total. The importance of customised policies, solutions, and services related to segmentation, private/public, and scaling in the education sector is being emphasised more and more.

Scale-up is spread across the economy. Based on ONS's sectoral data, we identified the sector with the most significant growth in scale-up. The analysis confirms that scale-up is distributed across various industrial sectors in the UK. The sector where scale-up developed the most was found to be distribution-related. The health and social welfare sector had the most scale-ups in 2017 but saw the most significant decline in 2018. The industry with the largest increase was the manufacturing industry, followed by the information and communication industry. Scale-up has also consistently been more productive than its peers in most sectors of the economy. In the same sector, scale-up recorded higher productivity by more than 54% on average, and especially in the construction industry, although the number of scale-ups decreased, productivity was higher by 161%.

ScaleUp Institute tracked individual companies according to time trends through longitudinal data analysis of ONS in 2019 and identified scale-up characteristics and growth development. It was possible to analyse a company's scale-up cycle, general scale-up and growth-related factors, and sales for the first time. Meanwhile, using the Business Structure Database, a longitudinal data containing more than 99% of UK economic activity, the UK scale-up since 2001 was tracked and analysed. The scale-up method, sales, and the number of employees were identified. Here, 'scaling' means that the average annual growth rate for three years exceeded 20%, and overlapping periods are also allowed. The main analysis results are as follows.

First, scale-up maintains high growth. It was found that 2/3 of scale-up companies recorded high growth at least once during the same period, and 43% of companies that expanded their scale three times or more. Second, the sales of scale-up, which showed an increase in sales, continued to increase, and it was found that scale-up, which showed a rise in employment, also showed an increase in employment. Third, it was found that the sales of scale-up, which showed employment growth, also increased. It was found that three-quarters of scale-ups that showed employment growth had sales growth at least once during the same period. However, this did not apply to sales growth. It was found that the ratio of sales growth leading to employment growth was not significant. Fourth, scale-ups typically generate sales of between £1m and £5m per year. It is the case for 63% of all scale-ups and 19% of scale-ups with an average annual turnover of more than £10m. Fifth, the number of employees of scale-up was generally found to be 10 to 50. It corresponds to the case of scale-up that recorded employment or sales growth, and it was found that scale-up that recorded employment growth hires more people than scale-up that recorded sales growth. Scale-ups with more than 250 employees accounted for only 6% of the total.

In the case of the South East of England, there are many places where the number of scale-ups relative to the population is high, and in the North East, places where the number of scale-ups relative to the population decrease are observed. Compared to the previous year, there are many areas where growth has been slow or decreased. The region with the highest growth was identified as Gloucestershire.

Among the scale-ups that showed sales growth, the five LEP regions that showed the most significant growth were Oxfordshire, Gloucestershire, Worcestershire, Buckinghamshire Thames Valley, and Enterprise M3. In addition, the top five LEP and sovereign countries for employment growth were identified as Gloucestershire, Buckinghamshire, Thames Valley, Thames Valley Berkshire, Hertfordshire, and Cheshire and Warrington. In 2018, 11 regions had an average annual employment growth scale-up of 1 or more per 100,000 population. It shows a significant difference from that of one region in 2017, indicating that the scale-up of employment growth has significantly increased.

According to the 2021 ScaleUp Survey, scale-up leaders are more ambitious and innovative than ever (72% invest in innovation and R&D) and have global plans and growth intentions over the next 12 months. Nine out of ten expect growth, half expect a scale-up of 20% or more, and one in four expect more than 50% growth. Many are already exporting, and 7 in 10 people who do not currently trade abroad plan to go global after 2020. In a direct response to the coronavirus, 1 in 3 people hired new employees, and 1 in 10 moved to more extensive or newer buildings. Four in ten focus on developing new collaborations and partnerships, but this trend is particularly evident in the life sciences and technology sectors. Even in the creative and professional service industries, 5 out of 10 people are looking for ways to activate collaboration.

Each year, the ScaleUp Institute evaluates 11 factors that can be barriers to the growth ambitions of expanding CEOs. Moreover, in 2021, access to the market, talent, and growth capital are identified as the top priority for expansion CEOs.

Policy Governance

The UK, along with Denmark, is regarded as one of the leading countries in adopting a 'scale-up' fostering strategy in economic policy. The UK's focus on the scale-up policy stemmed from the problem of delayed economic recovery in the UK compared to other advanced countries such as the US after the financial crisis. The UK government diagnosed that the scale-up gap is one of those causes. Since the mid-2010s, it has been promoting policies to support the scale-up of companies for the development of the national economy.

Coutu Report

The UK's scale-up policy was embodied in "The Scale-up Report on UK Economic Growth (Coutu Report)" submitted to the UK government by Sherry Coutu in November 2014. The Information Economy Council promoted this report, a public-private consultative body established by the 'Information Economy Strategy' in 2013. The report contains the contents of identifying the current scale-up situation in the UK, deriving major obstacles that restrict scale-up, and recommending strategies and tasks to foster scale-up companies to the UK government. Coutu (2014) suggested five significant obstacles that limit the scale-up of firms in the UK. First is a shortage of talented workforce. Second, a lack of leadership of managers or managers regarding scale-up. Third, there is a restriction on access to domestic and foreign markets required for corporate growth. Fourth, it is not easy to secure the necessary funds for scale-up. Fifth, there is a lack of legal framework and physical infrastructure to encourage scale-up. Therefore, the report considers these five barriers to a national strategy to address the scale-up gap that the UK is facing: 1) securing talent, 2) strengthening leadership, 3) enhancing market access, 4) promoting investment, 5) building infrastructure.

Meanwhile, Coutu (2014) emphasised the active intervention and role of the government in creating a successful ecosystem that encourages scale-up enterprises. He said that the role of the government to identify scale-up and set it as a policy goal is very important for the various stakeholders participating in the scale-up ecosystem to support the scale-up company's talent, leadership, market and customers, funds and infrastructure. In particular, mentioned two crucial roles that governments should be involved in. One is to provide a platform for the government to collect, manage, and open various data on scale-up so that stakeholders can use it to identify scale-up and evaluate its performance. The other is for governments to foster multiple platforms that help scale-up companies reach their potential while at the same time building a network where these platforms can work together.

BEIS

Currently, the UK scale-up policy is included in the policy field to support SMEs and start-ups and has a deep connection with the policy of industrial structure reform through R&D and innovation. Accordingly, the scale-up policy has been under the 'Benefits and Energy Industry Strategy (BEIS)' jurisdiction since 2016, and most of the major issues recommended by the Coutu report to the government have been accepted and promoted.

First of all, by using the public data held by the 'Companies House' under BEIS and the 'HM Revenue and Customs (HMRC)' to understand the actual situation of UK scale-up companies and ecosystems. The 'Scale-up Review Report' is published every year. This review report is not conducted directly by BEIS but by the 'ScaleUp Institute'. It is published for use by private and public institutions related to scale-up, including the government. Next, BEIS, together with other ministries, actively reflects programs that support and encourage scale-up of enterprises in various policies such as export, innovation, and investment. For example, in March 2017, BEIS formed the Scale-up Taskforce by its industrial strategy to support the growth of small and medium-sized enterprises (SMEs). This task force increased the number of scale-up companies, provided ways to unlock their potential in domestic and overseas markets, and uncovered obstacles that hindered them. BEIS announced 'Industrial Strategy: The Grand Challenges' established in 2017, presented by the Scale-Up Task Force: 1) Creation of investment funds for scale-up companies, 2) Cooperation network of scale-up companies Construction and 3) improvement of the procurement market for supply chain development and innovation were reflected as policy tasks (HM Government, 2017a; 2017b). Lastly, BEIS collects and provides information on scale-up support programs operated by the government, local governments, and the private sector and discovers and introduces successful cases of scale-up companies. In particular, we support establishing a cross-platform cooperative network that collects and introduces information on scale-up support programs and provides various scale-up support programs. It is not being carried out by BEIS directly but by the ScaleUp Institute.

ScaleUp Institute

The ScaleUp Institute is a platform dedicated to scale-up that supports the scale-up policy promoted by the government and cooperates with various scale-up stakeholders. However, the ScaleUp Institute is not a public institution funded by the government but a non-profit private organisation established in 2015 by several scale-up stakeholders. The ScaleUp Institute has a core goal of developing and sharing data related to the UK scale-up in cooperation with partners such as the UK National Statistical Office (ONS). It provides analysis results based on the accuracy and timeliness of more information to stakeholders such as local communities, local authorities, local business partnerships, and private organisations. It also conducts educational programs that promote action in the national, regional, local, financial, educational, and corporate sectors to implement practical solutions that support overcoming barriers to scale-up growth and addressing their challenges. These research and education programs have a tangible impact on scale-ups across the UK.

Specifically, the role played by the ScaleUp Institute can be divided into three broad categories. First, it is a survey and research to diagnose the actual situation of scale-up companies in the UK and the scale-up ecosystem surrounding them. The most representative is the 'Annual ScaleUp Review'. The annual scale-up report aims to analyse the impact of scale-up companies on the economic growth of the UK and review the UK scale-up ecosystem. Based on the contents of the 2014 Coutu report, it has been published annually since 2016. The ScaleUp Institute is conducting several surveys to understand the current state of the UK scale-up companies and the scale-up ecosystem. First, a survey is being conducted on the CEOs of scale-up companies to understand the difficulties scale-up companies face and their policy demands. Key findings from this survey are included in the Scale-Up Annual Report. Next, there is the 'Scaleup Index', which analyses and announces 'visible scale-ups' since 2017 to understand the current state of scale-up companies in the UK. This scale-up indicator collects administrative data of scale-up companies that met the criteria for high-growth companies among companies registered in the 'Companies House' and 'Alternative Investment Market (AIM)' and analysed. In addition to examining the distribution of scale-up companies by region, industry, and business history, we systematically present critical information on their assets, sales, exports, number of employees, equity financing, grant funding. Second, the scale-up laboratory functions as a 'data hub' that provides various data and information on scale-up. It operates a 'Find a Scaleup business', which allows you to search for scale-up companies in the UK on its website. Everyone can search for scale-up companies by industry, region, sales, growth rate, number of employees. Through this, various stakeholders can obtain information such as the location of the scale-up company, establishment date, company type, sales, sales growth rate, number of employees, and provide an opportunity to exchange or cooperate with each other.

Next, it provides a service (Find the support to scale your business) to find information on scale-up support programs operated by the private and public sectors on the website. As of 2020, there are 198 scale-up support programs registered in the ScaleUp Institute's search service. In particular, the types of support programs include 1) talent and competency support, 2) leadership development and cultivation, 3) network building and access, 4) collaboration support, 5) competency training, 6) overseas market entry, 7) public purchase and market access, 8) financial support, 9) R&D and innovation support, and 10) facilities and office space support. Users can obtain outline information about the organisation (platform) operating the scale-up support program and its contents through search and can also go to the website of the operating organisation. Third, the ScaleUp Institute provides education and consulting so that each local community can have an optimal ecosystem for businesses to scale up. First of all, the ScaleUp Institute operates the 'Scaleup Ambassador' or 'Scaleup Champion' so that companies, representatives, policymakers, and support organisations can obtain advice on scale-up. If someone wants to request an interview with the ScaleUp Ambassador on the ScaleUp Institute's website, the request is sent to the ScaleUp Ambassador. In addition, although the ScaleUp Institute does not directly conduct it, it collects various information and knowledge about scale-up through the distribution of newsletters and provides it to applicants. In particular, it plays a role in discovering trends and success stories related to scale-up and delivering them to stakeholders.

Finally, it can be said that the primary role of the ScaleUp Institute is to listen to the opinions of various stakeholders on the scale-up policy of the UK government or local governments and deliver their feedback. The ScaleUp Institute has partnered with the UK National Statistics Office (ONS) and the Internal Revenue Service (HMRC) to develop innovative ways to use data to identify businesses that need scale-up assistance. We are also working closely with Innovate UK and the British Business Bank (BBB) to address the fundamental challenges of scale-up companies. Innovate UK, an affiliate of the UK Research and Innovation (UKRI), utilises the results of the ScaleUp Institute's The ScaleUp Index and Annual ScaleUp Review Report to establish policies for high-growth companies. They plan to continue supporting activities to create a scale-up ecosystem in each region by maintaining a continuous partnership with the ScaleUp Institute and expanding participation in industry-university-related partnerships. Through these roles and activities, the number of scale-ups in 2017 increased by 35% compared to 2013, five years ago. These efforts have expanded to include politics and worldwide, and each year many institutions are taking the lead, focusing on scale-up companies to realise their growth potential. The Ministerial Champion for Scaleups was established as a policy proposal of the ScaleUp Institute, and scale-up has played a significant role in government reports, various presentations, and budget allocation. Despite these efforts, regional imbalances still persist across the UK, and too many regions are slow to scale-up growth. It can be seen that support activities are still concentrated in some areas, and initiatives or programs with significant impact are limited to some areas. The ScaleUp Institute will continue to promote scale-up research and education activities from the perspective of the local ecosystem so that the local government, which is not involved in much, now can include support for scale-up companies in its industrial strategy.

Korea’s Policy State

Scale-ups in Korea: Lack of Quantity of High-Growth Companies

In Korea, "scale-up" is not yet clearly defined and used. In some studies, scale-up is expressed as a "high-growth company". From around 2017, there was a perception that there was not enough research to derive quantitative and qualitative characteristics and continuous monitoring of high-growth companies in Korea. Accordingly, the Science and Technology Policy Institute (referred to as STEPI) has been conducting research on 'high-growth companies' every year from 2009 to 2019 (Kang, H. et al., 2018). Kang, H. et al. (2018) define a high-growth company as "a company with a sales (or employment) growth rate of 15% (or 10%) or more among listed companies employing 50 or more employees over the past five years. In Korea, many high-growth companies were 125 in 2018, starting with 100 in 2009. It is still a minimal number compared to European countries that have implemented scale-up monitoring policies early on.

Another source of data that can identify the current status of high-growth companies in Korea is the 'Business Demography Statistics' released annually by the National Statistical Office. The business life and death statistics are calculated using administrative data such as business registration, value-added tax and corporate tax return, and income payment details according to various laws and regulations to calculate the start-up, extinction, growth, and survival rate of active companies. Among these, statistics on high-growth companies and gazelle companies are included. A high-growth company used in corporate life and death administrative statistics is 'Among companies with ten or more regular workers, the average annual growth rate of sales and regular workers for the past three years is 10% or companies with more than 20%. This definition can be seen as the "companies with ten or more regular employees, whose annual average increase in sales and the number of regular employees has increased by 20% or more over the past three years," suggested by the OECD as a standard for high-growth companies.

According to this statistic, there were 20,997 high-growth companies based on sales in 2009, 6,608 companies based on regular workers, and 4,185 companies that satisfy both criteria. In 2018, these numbers were 20,373, 8,129, and 4,600, confirming that there is no significant change even after nearly ten years.

In terms of the absolute number of scale-ups, the number of scale-ups based on sales showed negative growth with an average annual growth rate of –0.33% between 2009 and 2018. Moreover, when the ratio of the total number of active companies with ten or more regular workers in the base year as a relative standard is applied, both sales (annual average -4.2%) and the number of regular workers (-1.74%) showed negative growth. It suggests that the proportion of domestic scale-up is declining. In particular, looking at the basis of sales, its proportion has markedly decreased between 2009 and 2013, which shows that the number of scale-ups has dramatically decreased since the 2008 global financial crisis even though the total number of companies has increased. The proportion of scale-up based on the number of employees has been decreasing since 2014, which can be seen as a result of showing that the external influence of the financial crisis has a priority on sales and has a negative effect on the proportion of scale-up based on the number of employees in stages after that.

Although the overall scale of high-growth companies in Korea is small, they recorded very high performance in terms of employment and exports and sales over the last four years (2012-2015). The average number of employees in high-growth companies increased from 33 in 2012 to 49 in 2015, an average annual increase of 14.1%. (The average annual employment growth rate of SMEs during the same period is 3.6%.) The average sales of high-growth companies increased by 35.9% per year from 5.72 billion won in 2012 to 14.37 billion won in 2015. The average export amount was 5.92 billion won in 2015 from 2 billion won in 2012, with an average annual increase of 43.6%.

Non-manufacturing high-growth companies such as services have an advantage over high-growth manufacturing companies in terms of employment size and employment growth rate. However, high-growth manufacturing companies have an advantage in the quantitative scale of sales and exports.

According to Pyo, H. (2017), by sector, high-growth companies in the service sector showed superiority in the number of companies and annual average growth rate compared to high-growth companies in the manufacturing and construction sectors. In terms of the number and average annual growth rate of domestic high-growth companies by industry based on sales, the service industry, manufacturing industry, construction industry and others were in order. Among Korean high-growth companies, the share of the service sector has been continuously increasing since 2011, while that of the manufacturing sector has shown a gradual decline.

Korea's high-growth companies are distributed in manufacturing, construction, and service industries such as wholesale and retail and generally tend to be distributed in various industries. Manufacturing (44%), construction (15%), wholesale and retail (9%), and publishing / video / broadcasting / communications (7%) account for 75% of all high-growth companies in that order.

Among high-growth companies, the proportion of companies with an average of 10 years or more is about half. The average of high-growth companies is 8.2 years, and the ratio of high-growth companies with more than ten years of experience is about 45.6% of the total high-growth companies.

Among the government subsidies, high-growth companies are most interested in human resources support, but general companies show overwhelming financial support. High-growth companies performed government support programs in the order of human resource support (35.9%), financial support (35.0%), management support (12.2%), and technical support (7.8%). In comparison, general companies that provided financial support (73.8%), Human resources support (12.4%), management support (8.6%), and technical support (1.8%) received government support in that order. The difference is that high-growth companies are relatively free in fund management due to increased sales. However, general companies are expected to have limitations in business operation due to insufficient sales generation. These results can be the basis for the need for customised support to induce continuous growth as a high-growth company when establishing a scale-up policy.

According to Kang, H. et al. (2018), Korean high-growth companies are characterised by high R&D intensity compared to other companies and high innovation levels because they hold many patents. They are continuously innovating products, and when they try to develop technology for product innovation, there are more and more cases of collaboration with other companies, government-funded research institutes, and universities. In particular, recently, the number of cases in which companies that have received the InnoBiz or venture company certifications are selected as high-growth companies continues to increase, indicating that high-growth companies are companies with strong technological prowess.

As of 2018, there were 28 gazelle companies with 100 billion won or more sales among venture companies. Since 2005, the Ministry of SMEs and Start-ups (Referred as to MSS) and the Venture Business Association have announced ‘100 billion venture companies' based on companies with 100 billion won or more annual sales in the previous year, starting with 68 in 2005 and 587 in 2019. The average business history of 100 billion venture companies is 24.9 years, and the proportions of large companies, medium-sized companies and small and medium-sized enterprises are 3%, 66%, and 31%, respectively. The sales of 28 billion gazelles are 239.4 billion won, and the average number of employees per company is 321.

Meanwhile, looking at the international ranking of the venture ecosystem, while major cities in the US, UK, and China are taking the top spot in the global venture ecosystem, Seoul, Korea's representative city, is ranked 20th. The venture ecosystem ranking is comprehensively evaluated according to quantitative and qualitative criteria such as corporate value, recovery performance, investment resources, market access, human resources, basic knowledge and experience, and regulatory environment. In the 2020 Global Venture Ecosystem (city-based) ranking, Seoul, Korea ranked 20th (12th, nation-based). Compared to Seoul, which was not included in the top 30 in 2019, it is encouraging result that the ranking has risen sharply in one year.

However, Seoul's Venture Ecosystem Value is $39 billion, which is higher than the global average ($10.5 billion) but still has a massive gap with Silicon Valley ($677 billion) and Beijing ($345 billion). The value of the venture ecosystem is calculated by adding up the value and recovery performance of start-ups belonging to the venture ecosystem (based on the performance of the last three years). It was analysed that Seoul had a lower increase in initial investment and recovery than other cities with a similar development stage of the venture ecosystem. Since the increase in the initial investment amount and the recovery rate are closely linked to high-growth companies, the venture ecosystem ranking will also indicate Korea's scale-up level. Accordingly, in Korea, the quantitative level of high-growth companies is low, and the necessity of revitalising high-growth companies is emphasised in the venture ecosystem index.

Policy Governance

From 2010 to the present, Korea's SME support policy is a period of strengthening SMEs' creative technological innovation capabilities to secure growth engines and pursue innovative growth. A support system for each growth stage of SMEs was established, R&D support efficiency was promoted, and efforts were made to close the gap between SMEs. In 2014, the 3rd 5-year SME technological innovation plan (2014-2018) was established, and in the same year, the private-led technology start-up support program started (TIPS; Tech Incubator Program for Start-up Korea). Selective and intensive projects such as R&D for export companies and projects to expand the base such as first step technology development projects were started at the same time. In particular, in 2017, with the inauguration of the Moon Jae-in government, the government organisation in charge of small and medium-sized enterprises (SMEs), which was at the level of the governmental agency, which is a sub-level organisation, was expanded to the Ministry of SMEs and Start-ups (ministerial level). The support policies for SMEs and venture businesses were strengthened comprehensively and systematically (Government Organization Act, Article 26).

Specifically, the reinforced contents are as follows. The functions of support for small and medium-sized venture companies previously performed by other ministries can be transferred, and integrated functions can be performed. The Ministry of SMEs and Start-ups prepared 10.2 trillion won in the 2019 budget, a 14.9% increase from the 2018 main budget (8.9 trillion won). KRW 1.36 trillion was allocated for research and development (R&D) support. The main functions of the Ministry of SMEs and Start-ups include planning and synthesis of SME policies, protection and nurturing of SMEs, support for start-ups and venture businesses, cooperation between large and SMEs, and protection and support for small business owners. A local Small and Medium Venture Business Administration and its affiliated offices are set up as an organisational system. As sub-organisations, there are Operation Support Division, Ombudsman Support Group, Small Business Policy Office, Startup Venture Innovation Office and Small Business Policy Office. The Startup Venture Innovation Office is in charge of the start-up support policy.

In addition to the Ministry of SMEs and Start-ups, the Ministry of Science and Technology Information and Communication, the Ministry of Culture, Sports and Tourism, and each local government have supported start-ups in related fields.

Policies

Korea's SME policy has developed in response to the needs of the times (Lee et al., 2019). From the early days of industrialisation, it has been centred on funding support, human resource development, technological innovation, and market support. From the mid-1990s through the 2000s, the policy scope was gradually expanded to include start-ups and ventures, shared growth and knowledge services. It has been broadened; currently, the general areas of SME policy are financial support, human resources, technology, internationalisation, exports, domestic demand, start-up ventures, management support and so on; in fact, all areas of business activities are supported.

Looking at Korea's scale-up support and ecosystem, overall start-up support is expanding, and as a result, the start-up environment is creating quantitative results. In addition, the government-wide efforts to revitalise start-ups are creating quantitative results, such as an increase in the number of venture companies and the scale of angel investment. According to the Ministry of SMEs and Start-ups, as of 2019, all ministries' start-up support projects amounted to KRW 1.118 trillion in commercialisation (45.9%), R&D (33.9%), facilities/space (13.4%), educational support (4.2%), mentoring (2.0%), and network (0.6%) various projects are being pursued by type (MSS, 2019).

The Annual Plan of the Ministry of SMEs and Start-ups in 2021 includes 1) promoting technology, youth, and regional-oriented innovative start-ups about start-ups and ventures, 2) accelerating venture growth through the inflow of venture capital and talent, and 3) regional innovation through special regulation-free zones Entrepreneurial development.

The standouts are; the scope of support for start-ups in the future new industry will be extended longer (7 → 10 years), and more than 40% of the budget for start-up commercialisation will be allocated to the new industry. They will invest approximately KRW 1 trillion in equity funds, providing a priming material to induce private venture investment. Such as creating additional venture funds of KRW 2 trillion or more, activating stock options and formally launching the venture and start-up company academy induces an influx and long-term tenure. The investment or loan compound finance system, widely used in Silicon Valley in the United States, will be introduced (revision of the Venture Investment Act). It also includes the creation of a merger and acquisition (M&A) fund (2.35 trillion won in 2022) and the creation of an interim recovery fund (100 billion won). In addition, the investment system related to mergers and acquisitions (M&A) will be significantly improved. Venture and scale-up by easing investment restrictions, such as easing investment restrictions on listed corporations only for M&A funds, and allowing investment by major shareholders of the acquired company exceptionally when establishing a special purpose corporation (SPC) for M&A purposes to induce activation.

Comparison and Policy Recommendations

Comparison

Scale-up monitoring scheme

In the UK, the 'Department for Business, Energy and Industrial Strategy (BEIS)' has been in charge of the scale-up support since 2016. The 'ScaleUp Institute' has continuously provided the basis for promoting related policies. As pointed out earlier as a problem, Korea has similar statistics. Still, it has limitations as data for understanding scale-up because it simply provides only the number of companies or is limited to specific industry surveys.

There are two statistics related to high-growth companies in Korea. The National Statistical Office surveys the number of high-growth companies, and the Science and Technology Policy Institute surveys and provides the innovation characteristics of high-growth companies every year.

The National Statistical Office uses ‘Business Demography Statistics’ to announce the number of high-growth companies annually by industry, industry and region. The OECD standards are applied mutatis mutandis as 'a company with ten or more full-time employees, whose sales, and the number of regular workers increased by 10% or 20% on average over the past three years.'

The Science and Technology Policy Research Institute (Referred to as STEPI) investigates the innovation characteristics of high-growth companies through ‘Technology Innovation Performance Indicator Analysis and DB Construction Project’ and announces them every year. In order to analyse high-growth companies from technological innovation, the OECD standards for high-growth companies are applied mutatis mutandis. Furthermore, sales and regular workers' Companies that have grown at an average annual rate of 20% or more over the past three years' are surveyed. STEPI statistics select high-growth companies using company data from NICE evaluation information, analyse the quantitative innovation characteristics of high-growth companies for the selected companies and provide qualitative innovation characteristics through a survey. Quantitative innovation characteristics include employment and sales, industry and regional distribution, R&D intensity, and the number of patents, and how the difference in distribution between high-growth companies and other companies changes every year is investigated. Qualitative innovation characteristics are market, management, innovation strategy, prospects and risk factors, which is more critical to high-growth companies in the present and future time points, respectively.

However, there is no nationally approved statistics related to scale-up, and there are limits to the data that can monitor the overall status of scale-up. In particular, the high-growth companies survey by the National Statistical Office and STEPI have different criteria, so there is a limit to the use of linkage. Statistical Office's corporate life and administrative death statistics officially announce the current status of the number of high-growth companies by industry and region by criteria belonging to the scope of high-growth companies. However, only the number of companies is provided. STEPI's high-growth company survey is limited to the manufacturing, construction, information and communication, and specialised science and technology industries only, which are included in high innovation activities. Thus, it has limitations in understanding high-growth companies' overall status and innovation characteristics.

Scale-up support policy

As discussed in Chapter 4 above, various monitoring and supporting scale-up methods are systematically performed in the UK through organic cooperation between the BEIS-affiliated organisations and the ScaleUp Institute, a private organisation. The definition and standards of scale-up were established, and it was confirmed that a systematic growth system such as funds, market-entry, regulatory innovation, networking, and overseas expansion was operated through a dedicated agency.

In Korea, companies in the scale-up stage within 3 to 7 years of founding have relatively insufficient investments, and the proportion of support policies focuses on the start-up stage, so there is a need to solve this problem. Looking at this in detail, the support projects for companies in the 3 to 7-year leap-growth phase include the Start-up Leap Package and Tips Program and focus on financial support. Although the competition rate for the Startup Leap Package project increased as the business scale and the demand increased, the actual beneficiaries out of 13,715 applicants were only 1,600. So only 12% of the applicants were able to apply, and the size of the support budget was as of 2018, it was confirmed that this was only 1.4% of the total size of the job-oriented policy reform project of 5.8 trillion. As a support project for companies in the 3rd-7th year of leaping growth, the Startup Leap Package and Tips Program are being promoted, and it is mainly funded, and it can be seen that the budget is only 80 billion won (MSS, 2019).

In 2020, a budget of 1.4 trillion won was planned for start-up support, but about 0.3 trillion won was planned for scale-up support. Start-up support projects vary by type, such as commercialisation (50.4% in 2019), R&D (35.3%), facilities/space (8.7%), start-up education (3.7%), and mentoring (1.5%), but scale-up Policy projects appear mainly in the form of financial support such as the Startup Leap Package and TIPS Program. The Startup Leap Package lacks quantitative volume as only 12% benefit applicants.

According to a nationwide business survey in 2015, more than half of start-ups with less than seven years of experience are start-up companies. The average employment has decreased, and the 5-year survival rate has also fallen to less than half (27.5%) of the first-year survival rate (62.7%). In order for the revitalisation of start-ups to ultimately improve economic growth rate and job creation, it is necessary to combine with the market through quantitative efficiency, so the growth of high-growth companies must be supported. There should be a policy balance between start-ups and scale-up.

Policy Recommendations

Need to define scale-up and establish standards

Having data on who scale-ups are and where they are distributed can significantly change the quality of policies by clarifying the policy targets. Therefore, it is first necessary to establish definitions and standards for Korean scale-up companies. EU standard is for investment attraction, and OECD defined based on the increase in sales and employment. In Korea, the definition, 'Companies with more than ten employees, whose average annual sales or employment has increased by 20% or more over the past three years' is applied mutatis mutandis and presented. However, this standard is also a provisional definition based on the need for research and is not an official indicator to be used as a standard in actual policy. Therefore, a clear definition and standards for scale-up are essential elements for systematic policy establishment. It is necessary to prepare definitions and standards considering the domestic start-up ecosystem as soon as possible. To this end, it is required to statistically analyse domestic start-ups' quantitative and qualitative cases and follow-up research on the average indicator standard for high-growth companies.

Need to distinguish growth stages of scale-up

A standard to classify the scale-up growth stage is necessary. According to the growth stage of scale-ups, 'Scale-up' is defined as a company that has attracted more than $1 million investment since its establishment. 'Scaler' is a company that has attracted more than $100 million in investment since its establishment. 'Super Scaler' is classified as a company that has attracted more than USD 1 billion in investment, and policies are established for each step-by-step accordingly. Therefore, it is necessary to classify the steps for this and support growth through step-by-step policy establishment. Although there are differences between institutions, in Korea, depending on the stage of investment attraction, there are many places that offer 'seed investment of around 300 million won or less, 'Series A around 1 billion won' or 'Series B around 5 billion won'. If the criteria for the growth stage of scale-up companies are summarised using this, policy concentration and higher targeting can be promoted.

A Regular Scale-up survey

In order to solve the absence of a fact-finding survey, which was pointed out as a problem, it is necessary to conduct a scale-up survey regularly. Through this, it is possible to promote regional scale-up monitoring and services that can be provided to governments, regions, and businesses. The contents of the survey should include not only the current status (number) of scale-up by region and industry but also items including innovation activities and technological level of scale-up at a micro-level.

Kim, S. et al. (2020) conducted a study as a scale-up pilot survey. For example, the survey on scale-up's perception of digital transformation confirmed that 66.2% of the respondents' recognised as a crisis but did not know how to respond', confirming that even high-growth companies are not ready for digital transformation. Like this, through this regular scale-up survey, it is possible to efficiently identify the policy needs of scale-up.

Therefore, in Korea, there is a need for an organisation dedicated to surveys and research to diagnose the current status of scale-up and ecosystem. The role of the dedicated organisation will be:

Survey and research for diagnosing scale-up status and scale-up ecosystem

Role of 'data hub' related to scale-up

Provision of consulting for the creation of a local scale-up ecosystem, such as the UK ScaleUp Institute

Conclusion and Limitation

This study compares the British scale-up policy with Korea's and tries to contribute to strengthening Korea's scale-up policy through its implications. Learn about the policies to support scale-up companies that have already been developed in the EU and UK. Then, summarise the implications for Korea, just starting to use the concept of scale-up and is facing a policy transition period from start-ups to scale-up.

The biggest reason scale-up companies are attracting attention in Korea is that they are positive for economic revitalisation through job creation and sales growth. There is a great need to respond to the creation and economic revitalisation efficiently.

As a result of analysing both countries' cases, the following conclusions were drawn. The UK scale-up policy established the definition of scale-up and specific standards, and it was confirmed that a systematic growth system such as funds, market-entry, regulatory innovation, networking, and overseas expansion was operated through a dedicated agency. However, Korea's policy does not have a specific standard without a clear definition of scale-up, and the volume of the policy is quite insufficient at an early stage. In particular, accurate policy targeting is not achieved since it is only treated as part of the start-up policy.

This paper makes the following policy recommendations for the most critical areas among the various areas. First, it is necessary to establish definitions and standards for domestic scale-up companies. Second, it is necessary to present the criteria for the growth stage of scale-up companies. Third, to effectively support scale-up, it is necessary to create a system for conducting regular fact-finding surveys.

In this study, the implications of the Korean scale-up policy were derived by analysing the case of the British scale-up policy focusing on the existing literature. However, it has the following limitations. First, this research field is a field of scale-up that has been rapidly emerging recently, so here are limitations in data collection because there are not many existing studies conducted in Korea. Second, the limitations of Policy Transfer cannot be overlooked. In order for comparative policy research by functional classification between policies to be meaningful, each social, cultural, and psychological context cannot be ignored, and this is also the case in scale-up policies. Although the policy governance of the two countries appears to be similar at first glance as being integrated into BEIS and MSS, the actual policy enforcement function and policy network can move very differently. Therefore, the argument for establishing a private sector ScaleUp Institute similar to that of the UK in Korea may have a different effect. Therefore, considering that the scale-up policy in Korea is at a very early stage, this report informs that it was written with a focus on establishing the initial policy and shifting the focus.

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