| The purpose of this thesis is to discuss how to keep pace in a rapidly chang ing environment. The industry with the highest rate of change is the Information Technology (IT) field. The latest computers, mobile phones, internet, etc…ava ilable for use, today are the results of quickly evolving advances in IT. The Ko rean IT industry dates back over30years and now enjoys a leading position in t he international market. It accounts for roughly30%of GDP and exports. We will discuss what factors contributed to the growth and development of Korea’s ITand take a look its current position in relation to China. We will also consider th e various factors needed to maintain its dominant position and growth.China is in its30th year of reforms and a more open attitude which has fuel ed its steady9%rate of growth. The main contributing factor has been a shift a way from a labor intensive approach more towards an IT focused strategy. As a re suit of this switch, China’s IT sector has been experiencing extreme growth. The manufacturing techniques in its computer and appliance market has vastly improv ed along with its many others IT relevant industries. Realizing the importance o f a more IT based focus over its current labor intensive ones, the government ha s committed its resources for its future growth. The main purpose of this thesis is to compare both countries’IT industry and understand its present situation. We will also review the development of China’s IT and identify its comparative advantages.The analysis method employed entails gathering relative import/export statis tics and data as of a certain date to ascertain the resulting market share, Trad e Specialization Index, and the Revealed Comparative Advantage Index. Upon analy sis of these different indices, we will discuss each country’s competitive advan tages in regards to its competitive assets, human resources and market structure.The results conclude that China has the world’s largest market share at22.8 6%. Although there is a big gap between Korea and the United States, Korea’s mar ket share in the global economy is not that much lower than China’s. Korea has a higher Trade Specialization Index than China. Both countries specialize in the export of communications equipment. Korea focuses on electronic components and c ommunications equipment while China specializes more in radio and video technolo gy. Both countries have an RCA Index greater than one. Korea has a greater RCA I ndex for mobiles. This is largely due to more advanced manufacturing techniques which help increase exports. China has comparative advantages in computers, radi o and video technology. Much of China’s IT advances can be contributed to foreig n sources, and not from within. Many oversea companies and factories move to Chi na and export their finished goods.China’s main weakness in its IT industry is a lack of a professional workfor ce and techniques. China’s key advantage comes from its vast market which is exp ected to grow into the future. Since Korea has a much smaller domestic market it should continue to focus on developing areas in which it already has competitiv e advantages such as software development, electronic components and network dev ices. These are some of the main reasons that Korea has more advanced techniques that China. Korea should strive to maintain its dominant position into the futu re. China should further develop its IT techniques as well. Both countries have much to benefit from increased cooperation in M&A and R&D to further advanc es in new product ideas and techniques. |
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