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Taiwan's Hsinchu Region: Imitator and Partner for Silicon Valley

The Hsinchu region of Taiwan is one of Silicon Valley's most successful imitators--as well as one of its most important partners. By the late 1990s, producers in Hsinchu ranked as the world's most sophisticated and flexible manufacturers of personal computer-related systems and components as well as the world's leading semiconductor foundries. Taiwanese policymakers actively encouraged the development of an entrepreneurial and decentralized industrial system by investing heavily in technical education and research as well as by promoting the growth of venture capital and new firm formation. The most significant contributor to the region's success, however, was reversal of the brain drain in the early 1990s which insured close and ongoing business and personal ties between entrepreneurs and firms Silicon Valley and Hsinchu. This facilitates inter-regional collaborations and supports a rich two-way flow of skill, know-how and capital between the two regional economies.

AnnaLee Saxenian
Publication Date
June, 2001