Variation Across Sectoral Systems
Edited by Franco Malerba and Richard R. Nelson
Chapter 4: Explaining Variations in Semiconductor Catch-up Strategies in China, Korea, Malaysia and Taiwan
1 Rajah Rasiah, Xin-Xin Kong, Yeo Lin and Jaeyong Song 4.1 INTRODUCTION The evolution of semiconductor manufacturing was very much driven by precision control demands in the United States military but because of its complementary and enabler properties it is increasingly diffusing into the manufacture and use of many different products and processes. It is therefore very common to find semiconductor chips driving central panel control systems in the manufacture of steel and cement, CAD-CAM machines in garment making, monitoring of captive salmon, storing of graphic memory in digital cameras, powering computers, and providing control to computer numeric control (CNCs) and electronic device machines (EDMs). Although the processes of manufacturing semiconductor chips vary in sophistication – from simple transistors that replaced cathode ray tubes (CRT) in the transfusion of pictures in televisions to sophisticated microprocessors that power supercomputers – the design and fabrication of chips remain high technology. Hence, catch-up attempts in the industry have required lumpy investments in large physical plants, machinery and equipment, human capital and its requisite matching demand. Scale economies have not fallen despite continued miniaturization and the decomposition of semiconductor manufacturing vertically into chip design, chip fabrication, assembly and test. Even in Taiwan Amsden and Chu (2003) and Rasiah and Lin (2005) have argued that scale requirements have driven up firm size. Despite similarities, the sources of learning and innovation in the industry, as articulated by Malerba and Nelson in this volume, are expected to be different from the routes taken by firms in the other industries...
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