Keeping the high-tech region open and dynamic: The organizational networks of Taiwan's integrated circuit industry

This paper aims to bridge the literatures of industrial districts and organizational networks by studying the development of organizational relationships in Taiwan's integrated circuit (IC) industry. Firms of the IC industry in Taiwan are highly concentrated in the Hsinchu Science-based Industrial Park (HSIP). They not only have contributed the most to the combined sales for the HSIP compared to other industries for half a decade, but also have made Taiwan the country with the fourth-largest IC industry in the world today. Along with the creation and maintenance of global competitiveness in this industry, the means of developing organizational relationships and geographical linkages are examined in this paper. The empirical findings are based on analysis of data regarding the organizational connections for Taiwan's IC industry during 1976 to 1996, collected at the individual firm level. It is found that a concurrent process of intensifying the internal as well as external linkages has occurred in the HSIP, a young high-tech region. It indicates that not only is the "regional advantage" sufficiently sustained, but also the global industrial networks are continuously expanded to maintain the openness and dynamics of the region.