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23 November, 2016
Korea’s Policy For Platform Economy
Science and Technology Policy Institute
Byong-Sam CHOI, Byeongwon PA...
2
Contents
02
03
Korea’s Challenges
Policy for Platform Economy
01 Overview of The Korean Economy
3
The Korean Economy: Growth
GDP (1960-2015)
* Source: World Bank national accounts data / CIA The World Factbook
3.9 Bill...
4
The Korean Economy: Rebound and Crisis Overcome
Korea is the only country that has switched from recipient to donor of O...
5
Korea’s Challenges: Low Growth
How to reinvigorate the economy again?
Per capita income growth rate (1980-2012)
* Exchan...
6
Korea’s Challenges: The Fourth Industrial Revolution
• German Government “Industrie 4.0”
• World Economic Forum “The 4th...
7
Korea’s Challenges: The Fourth Industrial Revolution
Self-Driving Car
Voice Recognition
(Virtual Assistant)
Predix: Indu...
8
Korea’s Challenges: The Fourth Industrial Revolution
Platform is the key !
IoT Technology Stack Creating New Value with ...
9
Korea’s Challenges: The Fourth Industrial Revolution
Dominance of Platform Companies:
North America has 72% of the Value...
10
Policy for Platform Economy
Government can support the development of platform economy
as Leaders, as Suppliers, as Fac...
11
Policy for Platform Economy: Korean Government
Korean government supports the development of platform economy
as Leader...
12
Korea’s Policy: “9 National Strategic Projects”
Growth Engine Quality of Life
Precision Medicine
New Drug
Carbon Utiliz...
13
Korea’s Policy: “X Project” (new R&D)
Korean government is conducting an experiment of how to maximize
the participatio...
14
Korea’s Policy: Setup of AI Research Center
Korean government help private companies collaborate.
Seven companies set u...
15
Korea’s Policy: Establishment of Test Beds
Smart
Home
Smart
Grid
Smart
Healthcare
Smart
Car
Korean government establish...
16
Korea’s Policy: “Regulation–Free Zones”
14 Regulation-free Zones
Korean government is conducting an experiment of relax...
17
Q & A
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Byong-Sam Choi: Korea’s Policy For Platform Economy

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Byong-Sam Choi: Korea’s Policy For Platform Economy

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Byong-Sam Choi: Korea’s Policy For Platform Economy

  1. 1. 23 November, 2016 Korea’s Policy For Platform Economy Science and Technology Policy Institute Byong-Sam CHOI, Byeongwon PARK Finnish Government Meeting
  2. 2. 2 Contents 02 03 Korea’s Challenges Policy for Platform Economy 01 Overview of The Korean Economy
  3. 3. 3 The Korean Economy: Growth GDP (1960-2015) * Source: World Bank national accounts data / CIA The World Factbook 3.9 Billion (1960) 1.4 Trillion (2015) • GDP (PPP): $1.849 trillion (ranking 14) • GDP per capita (PPP): $36,500 (ranking 49) • GDP composition: agriculture 2.3%, industry 38.0%, services 59.7% • Exports: $548.8 billion (ranking 6) • Imports: $428.5 billion (ranking 10) Economic Profile (2015) Miracle On The Han River: Making Something Out of Nothing → The GDP has increased 354 times Since 1960 (1960-2015 CAGR 11.3%) (current US $)
  4. 4. 4 The Korean Economy: Rebound and Crisis Overcome Korea is the only country that has switched from recipient to donor of ODA. The Korean economy overcame the Asian Crisis in 4 years. ODA History Increasing Contribution Asian Crisis (1997-98) Korea implemented deep and wide structural reforms. Hundreds of companies were restructured and thousands of jobs were lost. Korea paid back the IMF bailout loan in 4 years after the crisis. * ODA: Official Development Assistance
  5. 5. 5 Korea’s Challenges: Low Growth How to reinvigorate the economy again? Per capita income growth rate (1980-2012) * Exchange rate based on 2005 PPP. Per capita income was smoothed out using Hodrick-Prescott filter. * Kim (2016), 20th Anniversary of Korea's membership to the OECD Korea is At A Crossroads. Growth rates are decreasing too early, too fast.
  6. 6. 6 Korea’s Challenges: The Fourth Industrial Revolution • German Government “Industrie 4.0” • World Economic Forum “The 4th Industrial Revolution” * Source: Industrie 4.0 Working Group (2013.4). Recommendations for implementing the strategic initiative INDUSTRIE 4.0, https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/ Driver Role Steam Power Mechanize Production Electric Power Create Mass Production Electronics / IT Automate Production Create Intelligent Production Data Analytics, Artificial Intelligence * Cyber-Physical Systems = Internet of Things (IoT) 1st 2nd 3rd 4th
  7. 7. 7 Korea’s Challenges: The Fourth Industrial Revolution Self-Driving Car Voice Recognition (Virtual Assistant) Predix: Industrial Internet Platform Smart Factory AI in Board Game AI in Healthcare AI in Robot Drone Sharing Cars Sharing Houses Smart Security Synthetic Biology Gather (Internet of Things), Store (Cloud Computing), Analyze and Create value (Big Data Analytics, Artificial Intelligence) Data is the key !
  8. 8. 8 Korea’s Challenges: The Fourth Industrial Revolution Platform is the key ! IoT Technology Stack Creating New Value with Data * Porter and Heppelmann (2014), Porter and Heppelmann (2015) Data Platform
  9. 9. 9 Korea’s Challenges: The Fourth Industrial Revolution Dominance of Platform Companies: North America has 72% of the Value → “Platform Anxiety” “This digital infrastructure will be controlled by a handful of American internet companies, which could dominate the economic life of the 21st century.” (Sigmar Gabriel, Vice Chancellor of Germany) Platform Companies: Gang of Four & Sharing Economy Platform Companies by Region * Center for Global Enterprise (2016)
  10. 10. 10 Policy for Platform Economy Government can support the development of platform economy as Leaders, as Suppliers, as Facilitators, as Market Makers, and as Regulators Topic Recommendation Vision Governmentneeds to foster and promotea clear aspirationand visionfor the Internetof Things Commissioning Governmentmust be an expert and strategiccustomer for the Internetof Things Spectrum and networks Governmentshould workwith experts to developa roadmapfor an Internetof Things infrastructureand to maximise connectivityand continuity Standards Governmentshould support the development of standards that facilitate interoperability,openness to new market entrantsand security against cybercrime and terrorism Skills and research Government,the education sector and businesses should prioritiseefforts to developa skilled workforceand a supply of capable data scientists Data Open application programminginterfaces should be createdfor all public bodies and regulatedindustries Regulationand legislation Governmentshould developa flexible and proportionatemodel for regulationin domains affected by the Internetof Things, to react quickly and effectivelyto technologicalchange, and balance the considerationof potentialbenefits and Harms Trust Governmentshould workwith industry and internationalpartnersto agree best practice security and privacy principles Coordination The DigitalEconomy Council should create an Internetof Things advisory board,bringing togetherthe privateand public sectors Recommendations to Support Digital Revolution “Leader” “Facilitator” “Market Maker” “Regulator” “Supplier” * UK Government (2014)
  11. 11. 11 Policy for Platform Economy: Korean Government Korean government supports the development of platform economy as Leaders, as Suppliers, as Facilitators, as Market Makers, and as Regulators Gov. as Suppliers Gov. as Facilitators Gov. as Marketers Gov. as Leaders Gov. as Regulators) • “9 National Strategic Projects” Vision Rule Input Process Output • “X Project” (new R&D) • Setup of AI Research Center • Establishment of Test Beds • “Regulation –Free Zones”
  12. 12. 12 Korea’s Policy: “9 National Strategic Projects” Growth Engine Quality of Life Precision Medicine New Drug Carbon Utilization Fine Dust Self-Driving Car Light Material Smart City Artificial Intelligence Virtual/Augmented Reality Korean government set national priorities on emerging technologies and applications
  13. 13. 13 Korea’s Policy: “X Project” (new R&D) Korean government is conducting an experiment of how to maximize the participation of the citizens to national R&D projects Design philosophy of the platform ① Every idea should be respected ② Operations should be simple ③ All the information should be open to all ④ Every participant should be given rewards ⑤ Operations should be scalable ⑥ Problems should be solvable and executable
  14. 14. 14 Korea’s Policy: Setup of AI Research Center Korean government help private companies collaborate. Seven companies set up the AI Research Institute (2016.7)
  15. 15. 15 Korea’s Policy: Establishment of Test Beds Smart Home Smart Grid Smart Healthcare Smart Car Korean government established test beds for smart home, smart grid, smart healthcare, and smart car.
  16. 16. 16 Korea’s Policy: “Regulation–Free Zones” 14 Regulation-free Zones Korean government is conducting an experiment of relaxing the regulation for boosting new industries while minimizing the risk of side effects • Choose 2 industries per a region • Remove virtuall all the existing regulation • Promote the introduction of new industries
  17. 17. 17 Q & A

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