Columbia International Affairs Online: Working Papers

CIAO DATE: 12/2013

Industrial Upgrading through Low-Cost and Fast Innovation—Taiwan's Experience

Dieter Ernst

September 2013

East-West Center


This paper examines the forces that drive Taiwan's new strategy of "Upgrading through Low-Cost and Fast Innovation." The first section highlights characteristics of Taiwan's traditional "Global Factory" innovation model and examines the role of innovation policy in that model. Section 2 reviews fundamental weaknesses that define the requirements of Taiwan's new innovation strategy. Section 3 explores Taiwan's new strategy of "low-cost and fast innovation through domestic and global innovation networks." Finally, section 4 examines the role of government and key policies and initiatives in the IT industry.