A Silicon Valley of the East: Creating Taiwan's Semiconductor Industry

A thriving semiconductor industry has been created in Taiwan over the course of the past two decades by the use of advanced organizational techniques of technology leverage and accelerated technology diffusion. By the mid-1990s, the industry had reached a level of output that placed it behind only the U.S., Japan, and Korea. Almost all of Taiwan's semiconductor industry is located in the Hsinchu Science-Based Industry Park, which was created in emulation of California's Stanford Research Park, but with more direct government involvement. This article explores the extent to which this emergent Silicon Valley in Taiwan shares the industrial ecology that has powered innovation in California and examines the extent to which the Taiwan industry suffers from weaknesses attributable to its rapid creation through technology leverage.