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ABSTRACT
This study examines the effects of South Korea’s Innovative City (IC) policy, which aims to redistribute public institutions to local cities to alleviate urban congestion and mitigate regional disparities. Utilizing the synthetic control method, this study evaluates the policy’s influence on local productivity and investigates its spillover effects. The findings reveal a marked increase in productivity within rural cities, highlighting the policy’s efficacy in less urbanized areas. However, the outcomes vary across different locales, with some urban ICs experiencing productivity enhancements, while rural ICs near expanding urban areas do not. Additionally, the study observes limited spillover effects in cities near ICs, indicating that indirect benefits are not uniformly distributed.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 South Korea’s local governance is organized into a dual-tier system. The upper tier comprises provinces (Do) and metropolitan cities (Gwangyeoksi), while the lower tier includes cities (Si), counties (Gun), and districts (Gu). Si and Gun refer to urban and rural areas respectively, with Gu being equivalent but possessing less authority, leading to its exclusion from this study. For analytical purposes, this study categorizes both Si and Gun under the term ‘cities’. When necessary, these categories are differentiated into ‘urban cities’ and ‘rural cities’ to address specific analytical needs.
Additional information
Notes on contributors
Yunjun Kim
Yunjun Kim is a PhD candidate in the Martin School of Public Policy and Administration at the University of Kentucky. His research focuses on local government finance, intergovernmental fiscal relations, and policy analysis.