개별기업의 산업간 다각화가 자기자본비용에 미치는 영향: 한국기업을 중심으로

김현희 ( Hyun Hee Kim ),전홍민 ( Hong Min Chun ),유용근 ( Yong Keun Yoo ) 한국회계학회 2010 회계학연구 Vol.35 No.1

본 연구는 한국기업을 대상으로 개별기업의 산업간 다각화가 자기자본비용에 미치는 영향에 대하여 분석하였다. 사전적으로 볼 때 기업들은 산업간 다각화를 통하여 현금흐름의 변동성을 줄이거나 저성과 사업부문을 적절히 지원함으로써 자기자본비용을 감소시킬 수 있을 것이다. 반면, 다각화 기업이 저성과 사업부문의 고위험 투자안에 과잉투자하고 다각화를 위하여 과도한 부채를 부담하거나 대리인 비용에 기인한 높은 정보위험을 초래할 경우 오히려 자기자본비용이 상승할 수도 있다. 한국의 유가증권 또는 코스닥 시장에 상장된 기업 중 2001년부터 2005년까지의 890개 관측치를 이용하여 실증분석을 수행한 결과, 개별기업의 사업별 부문수가 늘어날수록 자기자본비용이 유의하게 감소하는 것으로 관찰되었다. 즉 한국기업의 경우 다양한 산업으로 다각화를 추진할수록 기업 전체의 위험을 낮춤으로써 자기자본비용을 절감할 수 있는 것으로 나타났다. 이러한 실증 결과는 최근 들어 활발하게 이루어지고 있는 한국 기업의 산업간 다각화가 해당 기업에 미치는 영향을 이해하는 데에 추가적인 공헌점을 가질 수 있을 것이다. This paper examines the potential effect of corporate industrial diversification on cost of equity capital for Korean firms. Corporate industrial diversification is defined as a strategy by which a company conducts its businesses in multiple industries or markets at the same time for various purposes, such as pursuing a persistent growth and/or reducing firm risk. Given an increasing trend of corporate industrial diversification around the world, previous research in accounting and finance area has mainly analyzed the effect of corporate industrial diversification on firm value. Lang and Stultz (1994), Berger and Ofek (1995), and Rajan et al. (2000) conclude that corporate industrial diversification may cause a discount of firm value since the resource allocations within more diversified firms become less efficient. This is due to the overinvestment of internal funds into projects with low returns and/or excessive subsidies of highly performed segments on the other segments and/or overheated competitions among segments. To the contrary, Lewellen (1971) argues that negatively correlated cash flows from individual segments of more diversified firms may reduce the volatilities of firm-level cash flows and that such firms` enhanced ability to raise more debts may increase firm values through greater tax saving effects. Mansi and Reeb (2002) also suggest that industry diversification may have a positive effect on the sum of creditors` and shareholders` wealth. Furthermore, by using a more refined measure of industry diversification, Villalonga (2004) finds that the values of more diversified firms increase. In sum, prior research which examines the effect of corporate industry diversification on firm value has reported mixed results. To reconcile those mixed results, recent U.S. based studies begin to examine the effect of industry diversification on cost of equity capital, excluding its effect on future cash flows, both of which determine firm value. Demirkan et al. (2008) suggest that costs of equity capital of more diversified firms will increase because of their higher information risk which is caused by greater agency costs. To the contrary, Hann et al. (2009) argue that costs of equity capital of more diversified firms will decrease since their reduced volatilities of firm-level cash flows may reduce their systematic risks. Thus, whether corporate industry diversification has positive or negative effect on cost of equity capital is still an open empirical question. Furthermore, given that the purpose of industry diversification may differ across U.S. and Korean firms, which leads to a differential effect on cost of equity capital across countries, a separated research for Korean firms is called for. In an ex-ante sense, more diversified firms may decrease their costs of equity capital through reduced volatilities of future cash flows and/or appropriate crosssubsidies among segments. However, it is also possible that costs of equity capital of more diversified firms increase since such firms may overinvest their internal funds into riskier projects and/or take excessive debts for diversification and/or have higher information risks due to greater agency costs. By using 890 Korean firm/year observations between 2001 and 2005, we find that number of segments is negatively associated with cost of equity capital even after well-known risk proxies are controlled for. Thus, we conclude that more industrially diversified Korean firms decrease their costs of equity capital. This is the first study to examine the effect of corporate industry diversification on cost of equity capital for Korean firms. We believe that our empirical evidence may shed some lights on our understanding of the potential effect of corporate industry diversification on various aspects of firms.

한국의 산업혁명은 어떻게 이루어졌나?

강정모 한국제도∙경제학회 2023 제도와 경제 Vol.17 No.3

The paper attempts to institutionally examine the effect of policy-augmented human capital on the Industrial Revolution in Korea. The Industrial Revolution in England was competitively led by private companies based on the demand of farmers who became wealthy through industrialization. On the contrary, Korea carried out the 1st, 2nd and 3rd industrial revolutions almost simultaneously with government-led plans and based on export demand. All industrial revolutions were the result of openness and innovation, and the source of innovation was science and technology, which became the driving force of economic and social development. The basic factors impeding economic development are (i) a lack of ability to recognize and seize the opportunity, and (ii) a lack of incentive to exploit the opportunity. In an open economy, opportunity is endogenous depending largely on one’s desire, vision and capabilities. Human capital in economic sense is defined as the capacity to recognize opportunity (i.e. the capacity to acquire and digest information, and to achieve certain economic goals). In Korea, “policy-augmented human capital” has played a crucial role in industrial revolution and economic development. Policy-augmented human capital refers to human capital that has competent leaders with economic development plans. The combination of human capital as such with effective policies and strategies will create an environment where dormant innovative forces can be awakened and unleashed. Korea’s industrial revolution can be explained by five propositions that support economic development. Firstly, human capital augmented by policies determines the specialization of products, the nature and direction of trade, and the pace of economic growth. Secondly, the national wealth is determined by the size and the portfolio of diverse productive industries which is a function of human capital. Thirdly, changing size and composition of a country’s portfolio of productive industries is an intended outcome of industrial policy. Fourthly, a prosperous economy has better chance of achieving democracy than vice versa. Finally, if human capital augmented by policy is a necessary condition, political and social stability is a sufficient condition.

감사인의 산업전문성이 자기자본비용에 미치는 영향

도경분,이진수 한국회계정보학회 2010 재무와회계정보저널 Vol.10 No.4

The purpose of this paper is to investigate whether industry specialist auditors exist among the Big4s in Korean audit market using the auditor industry specialization as audit quality proxy. Also, this paper analyses the effect of audit quality on the cost of equity capital. In addition, it examines the effect of industry specialist auditors on the cost of equity capital in case of the earnings management firms. This paper measures the audit quality using the industrial market shares and measures the cost of equity capital by the MPEG model which is modified from the abnormal earnings growth model. This paper find as follows. First, this paper finds evidence that industry specialist auditors exist among the Big4s in Korean audit market. Second, the cost of equity capital of the firms audited by industry specialist auditors is lower than those audited by non-industry specialist auditors. This means that in the capital market, investors and interest-parties believe that audit quality of industry specialist auditors is higher and evaluate the reliability of the financial statements audited by the of industry specialist auditors is higher than non-industry specialist auditors. Third, we find that, even in the earnings management firms, the cost of equity capital of the firms audited by industry specialist auditors is lower than those audited by non-industry specialist auditors. The firms which manage earnings through accruals likely incur the information asymmetry, and the firms’ information risk is not to be diversified. Thus, the risk is price in the capital market and increases the cost of equity capital (Francis et al. 2004). However, the result of this paper shows that even in the earnings management firms, the cost of equity capital of the firms audited by industry specialist auditors is lower than those audited by non-industry specialist auditors. This paper’s results add a kind of contribution to the prior research. This paper presents evidence that industry specialist auditors exist among the Big4s in Korean audit market and shows the empirical results on the relationship between the industry specialist auditors and the cost of equity capital. 본 연구의 목적은 감사품질의 대용치로서 감사인의 산업전문성을 사용하여 우리나라 감사시장의 Big 4 내에서도 산업별 전문감사인이 존재하는지를 규명하고 감사품질이 자기자본비용에 미치는 영향과 이익조정이 발생한 기업의 경우 산업별 전문감사인이 자기자본에 미치는 영향에 관하여 실증분석 하는 것이다. 감사품질은 산업별 시장점유율을 사용하여 측정하였으며 자기자본비용은 초과이익성장모형을 수정한 MPEG모형을 사용하여 측정하였다. 실증분석을 위하여 2004년부터 2008년까지 증권거래소에 상장된 12월 결산법인 중 금융관련 업종에 속하지 않으며 대형회계법인이 감사하는 기업을 표본으로 사용하였으며, 본 논문의 분석결과는 다음과 같다. 첫째, 우리나라 감사시장에서 Big 4 감사인 내에서도 산업별 전문감사인이 존재함을 알 수 있었으며 둘째, 산업별 전문감사인이 감사한 기업의 자기자본비용은 그렇지 않은 경우보다 낮은 것으로 나타났으며, 이는 자본시장에서 투자자 및 기업의 외부이해관계자들이 산업별 전문감사인의 감사품질이 더 높으며 재무제표의 신뢰성을 높이 평가하는 것으로 해석할 수 있다. 셋째, 이익조정이 발생한 기업의 경우라도 산업별 전문감사인이 감사한다면 자기자본비용이 낮은 것으로 나타났다. 발생액을 통하여 이익조정을 한 기업은 정보불균형으로 인한 정보위험이 분산 불가능하며 이것이 시장에서 가치평가 되어 자기자본비용을 증가시킨다(Francis et al. 2004). 하지만 본 연구의 결과 이익조정이 발생했을지라도 산업별 전문감사인이 감사한 기업의 자기자본비용은 낮은 것은 자본시장에서 외부이해관계자들이 산업별 전문감사인의 감사품질을 높이 평가하고 재무제표의 신뢰성을 높이 평가하여 자기자본비용이 낮게 형성되는 것으로 해석할 수 있다. 본 연구는 우리나라 감사시장에서 대형회계법인 중에서도 산업별 전문감사인이 존재하고 있음에 대한 증거를 제시하였으며 산업별 전문감사인과 자기자본비용간의 관계에 대한 실증분석 결과를 제시하였다는데 의의가 있다.

주제별 논단 : 자본시장통합법의 쟁점과 과제 ; 자본시장통합법 제정에 따른 금융권역별 영향 및 금융감독 방향

오용석 ( Yong Suk Oh ) 한국금융법학회 2006 金融法硏究 Vol.3 No.1

For leading a financial Big Bang in the capital market by stimulating financial innovation and competition, the Korean government is working on the establishment of Capital Market and Financial Investment Services Act which will consolidate the existing capital market related acts. One of the main points of this act is to regard financial products with possibilities of losing a part of the principal as ``financial investment products``. Another main point is that a financial investment company is allowed to manage all six financial investment businesses(investment transactions, investment intermediation, collective investments, investment commitments, investment consulting and trust businesses). Also the Act extends the scope of investment business. For example, the Act allows financial investment companies to join the micro-settlement system of Korea Financial Telecommunications & Clearings Institute and this will greatly improve the convenience of the securities account, which until now was bound to provide only basic services. Finally the Act is upgrade the investor protection mechanism. For example, financial investment companies are required to receive clients`` signatures which confirm that clients are well informed of the details of the investment products when they sell investment products. Though the scope of this legislation is yet limited to the capital market and the securities industry, requests will be growing that banking and insurance industries should adopt the same regulation system. On the other hand, the business scope extension in securities industry is likely to causes more competitions among the industries and consumers in banking and insurance industries may claim more strict consumer protections in their areas. Because nowadays many securities companies are belong to financial groups, all the financial companies in a financial group will enjoy synergy effects by turning a securities company into a financial investment company. One of the worries regarding the Act is related with allowing financial investment companies to join the micro-settlement system. In spite of all the carefully designed systemsafety- purposed devices, overall risks of micro-settlement system due to the entrance of the securities companies are estimated to be increased slightly. For the banking industry, this legislation will be the chance to diversify banks`` income structures and increase their customers. However, the trust business in bank can be shrunken as the financial investment companies can run the trust business as a main business. For the insurance industry, the Act will help to improve the asset managing environment and escalate the possibility of joining the micro-settlement system, but competitions will also be growing because some business area can be overlapped. Clearly the securities industry will enjoy many benefits from the Act. First of all, the role and scale of the capital market will be enlarged and capital market related financial institutions can be large enough to compete with international investment banks such as Merrill Lynch through the capital increase and M&As. Competitiveness of investment products will grow and business grounds for the financial investment companies will be strengthened by offering comprehensive financial services. However, there is a good possibility that foreign investment companies can erode the new profitable market with advanced financial technique, skilled experts and sufficient capitals. For minimizing the adverse effects and maximizing the positive effects, the methods of financial supervision should be adjusted. The confusion caused from the co-existence of institutional regulations(banking and insurance industry sectors) and functional regulations (securities industry sector) can be eliminated by changing the supervisory organization in the way that institutional regulations are supplemented by functional regulations. Also the balances between the securities industry supervision and banking/insurance supervision should be considered to get rid of possible discriminations caused by different regulation systems.

기업벤처캐피탈 투자에 미치는 거시적 요인의 영향: 산업 호황, 외생적 위기, 경제 성장, 경쟁 강도를 중심으로

김도윤,신동엽 한국벤처창업학회 2021 벤처창업연구 Vol.16 No.4

This paper inquires the macro-economic factors that may affect the corporate venture capital (CVC) from an industrial organization theory perspective. Unlike existing studies focusing CVC investments related to parent corporates' strategic intention, we identified CVC firm as an independent financial investor affected by macro environment and industrial structure. Specifically, we empirically investigate whether and how industry's boom, exogenous crisis, economic growth, and competition intensity affect the CVC investment for a data set of investment in the U.S. based corporate venture capital industry, 1996-2017. The empirical data analyzed in the study contained a total of 84 U.S. based CVC firms and their 2,306 investments from 1996 until 2017. After conducting a time-series negative binomial analysis, our empirical analyses suggest that the CVC investments are affected negatively by exogenous crisis and competition intensity, and positively by industrial boom and economic growth. we found the significance and direction of our independent variables strongly supported all of our four hypotheses in a highly robust manner. The results of this study are expected to contribute the literatures of corporate venture capital and venture investment by illustrating which macro-economic and industrial structure factors affect CVC investment decision to adapt to dynamic environmental change beside strategic intention of CVC firm's parent corporates. 이 연구는 기업벤처캐피탈에 대한 거시적경제, 산업구조적 관점에서 기업벤처케피탈 투자에 영향을 미치는 요인들에 대해 탐색한다. 기업벤처캐피탈 투자에 관한 기존 연구들이 모기업의 사업 다각화, 신규 사업 진출을 위한 기업벤처링(Corporate Venturing) 등 모기업과의 관련성을 중심으로 기업벤처캐피탈의 정체성과 투자목적에 대해 논의해온 것과 달리, 본 연구는 변화하는 거시경제적, 산업구조적 환경적 요인에 영향을 받고 이에 대응하는 독립적, 재무적 투자자로서의 기업벤처캐피탈의 정체성에 주목하여, 기업벤처캐피탈 투자에 미치는 영향을 분석한다. 이를 위해 구체적으로 산업 호황, 외생적 위기, 경제 성장, 산업 내 경쟁 강도 등과 같은 거시적 요인들이 기업벤처캐피탈 투자에 미치는 영향에 대해 1996년부터 2017년까지 84개 미국 기업벤처캐피탈의 2,306건의 투자데이터를 기반으로 실증분석하였다. 분석결과 일반적인 독립벤처캐피탈과 마찬가지로 산업이 호황이고, 경제가 성장할 때는 기업벤처캐피탈도 투자를 늘리고, 외생적 위기가 발생하거나, 기업벤처캐피탈들 간 경쟁 강도가 강할수록 투자가 줄어들 것이라는 가설이 모두 지지되었다. 주로 모기업과의 관계, 피투자회사와 모기업 사업의 관련성 등을 중심으로 기업벤처캐피탈 투자에 대해 논의했던 선행 연구들과 달리, 기업벤처캐피탈의 재무적 투자자로서의 정체성과 기업벤처캐피탈 투자에 미치는 거시경제적, 산업구조적 요인들의 영향에 대해 환기함으로써 기업벤처캐피탈 투자에 대한 논의의 폭을 확장하고, 기업벤처캐피탈 투자의사결정자들에게 거시경제적, 산업구조적 요인들에 대한 대응을 시사한다는 점에서 의의가 있다.

Human Capital as a Development Factor for Cultural and Creative Industries

Horban, Yurii,Dolbenko, Tetiana,Yaroshenko, Tetiana,Sokol, Oleksandr,Miatenko, Nataliia International Journal of Computer ScienceNetwork S 2021 International journal of computer science and netw Vol.21 No.spc12

Human capital is the defining value of the national economy under market conditions. The manifestation of human capital is realized as an intellectual and creative capital, theoretically grounded and proven. The realization of intellectual capital is realized through the research creativity of scientists and researchers, and creative capital is manifested through artists and thinkers. Accordingly, creativity in market conditions forms a separate source of income and is an essential article in the formation of the GDP of the national economy. This research aims to analyze human capital from the perspective of cultural and creative industries. Research methods: systematization; comparative analysis of individual indicators of advanced countries of the world on the training system; statistical, taking into account macroeconomic indicators to assess the level of national creativity potential; system and logical analysis; method of information synthesis. Research results. The structural and quantitative composition of the factors of intellectual and creative capital formation has been systematized. The article proves that the unique properties of human capital, knowledge, creativity, experience and professional skills are the push factors of creativity development of the national economy and provide the priority development of creative and cultural industry that allows generating the added value on the national scale. The functions of creativity in the sphere of cultural industries are highlighted. It is noted that education and creativity of both intellectual and creative capital are the forming basis. The research of the world's advanced countries on the creativity index has pointed out the Netherlands as the leading country in the quantitative measurement of creativity. The economic development factors of the Netherlands were analyzed from the position of economic creativity, which allowed the formation of a two-factor model providing priority development of creativity in the cultural and creative industries.

Human Capital as a Development Factor for Cultural and Creative Industries

Horban, Yurii,Dolbenko, Tetiana,Yaroshenko, Tetiana,Sokol, Oleksandr,Miatenko, Nataliia International Journal of Computer ScienceNetwork S 2021 International journal of computer science and netw Vol.21 No.12

Human capital is the defining value of the national economy under market conditions. The manifestation of human capital is realized as an intellectual and creative capital, theoretically grounded and proven. The realization of intellectual capital is realized through the research creativity of scientists and researchers, and creative capital is manifested through artists and thinkers. Accordingly, creativity in market conditions forms a separate source of income and is an essential article in the formation of the GDP of the national economy. This research aims to analyze human capital from the perspective of cultural and creative industries. Research methods: systematization; comparative analysis of individual indicators of advanced countries of the world on the training system; statistical, taking into account macroeconomic indicators to assess the level of national creativity potential; system and logical analysis; method of information synthesis. Research results. The structural and quantitative composition of the factors of intellectual and creative capital formation has been systematized. The article proves that the unique properties of human capital, knowledge, creativity, experience and professional skills are the push factors of creativity development of the national economy and provide the priority development of creative and cultural industry that allows generating the added value on the national scale. The functions of creativity in the sphere of cultural industries are highlighted. It is noted that education and creativity of both intellectual and creative capital are the forming basis. The research of the world's advanced countries on the creativity index has pointed out the Netherlands as the leading country in the quantitative measurement of creativity. The economic development factors of the Netherlands were analyzed from the position of economic creativity, which allowed the formation of a two-factor model providing priority development of creativity in the cultural and creative industries.

The East Asian Model : Restatement

Kwon, Jene-K. 한국비교경제학회 2004 비교경제연구 Vol.11 No.1

This paper attempts to present a theoretical framework that helps understanding the experiences of economic development in the East Asia. This study posits that policy augmented human capital is the foundation of the East Asian economic development. The policy-augmented human capital is the human capital with a road map for economic development. In this model the ability to formulate and execute effective economic policy is treated as a part of human capital. A country is poor because of the deficiency of human capital or the absence of coherent road map, or due to misleading road map. The East Asian economies were successful because of the high level of human capital guided by an effective road map. Once this key proposition is accepted, other propositions fall into place: that is, industrialization can be viewed as a process of portfolio diversification strategy in which the size and composition of diverse productive industries is a function of the level of human capital. And, over time, changing size and composition of a country's portfolio of productive industries are not entirely spontaneous but an intended outcome of industrial policy. This study also proposes that a prosperous economy has a better chance of achieving democracy than the other way around, but human capital is not a sufficient condition for successful industrial policy. In other words, the effectiveness of government in promoting the efficiency of market coordination cannot be taken for granted.

금산분리 관련 제도의 현황과 논점

이병윤 ( Byung Yoon Lee ) 한국금융연구원 2006 금융연구 Vol.20 No.S

금융회사 특히 은행이 기업 모니터링의 주체 역할을 충실하게 수행할 때 효율적 자원배분과 상시적 기업구조조정이 이루어져 시장경제시스템이 원활하게 작동하게 된다. 따라서 기업 즉 산업자본이 모니터링의 주체인 은행 즉 금융자본을 소유하거나 지배하는 것은 시장경제시스템의 원활한 작동을 위해 바람직하지 않다. 또한 금융회사를 소유한 기업과 소유하지 못한 기업간 불공정 경쟁 가능성을 없애고 금융회사 소유 산업자본의 지배주주와 고객간 이해상충 문제를 해소하기 위해서도 산업자본과 금융자본은 분리되는 것이 바람직하다. 이러한 이유로 우리 정부는 산업자본의 은행 소유는 제한하고 비은행 금융회사의 소유는 불가피하게 인정하되 이에 따른 부작용 방지를 위한 정책을 추진하는 정책기조를 유지해 왔다. 그런데 최근 들어 외국자본의 국내 은행산업 진출의 여러 가지 문제점들이 지적되고, 은행을 인수할 수 있는 국내자본은 결국 산업자본뿐이라는 현실을 감안하여 산업자본의 은행소유 제한을 완화해야 한다는 주장이 다시 나오고 있다. 그러나 산업자본의 은행 소유 및 지배는 앞에서 살펴본 것처럼 폐해가 크다고 할 수 있다. 또 외국자본의 은행산업 진출에 따른 폐해가 심각한 지경인지는 제대로 검증된 바 없다. 오히려 우리 은행들의 경영이 투명해지고, 건전해졌다는 점을 지적하는 주장도 많다. 은행산업에서 외국자본에 대한 견제가 필요하다면 굳이 부작용이 많은 산업자본을 가져오지 않더라도 다른 방법들을 생각해 볼 수 있을 것이다. 본 논문에서는 지배구조를 개선한 연기금 풀(pool)을 이용한 은행의 인수, 금융회사간 상호 주식보유(cross-shareholding) 등을 제시하였다. This paper firstly suggests the reasons why banking and commerce should be separated. Among them, the main reason is that banks have to monitor industrial firms which lent money from them. If industrial firms own banks, it should be difficult for banks to fairly monitor industrial firms. In addition, conflicts of interests between bank customers and majority shareholders of an industrial firm can occur if an industrial firm owns banks. Due to these reasons, the separation of banking and commerce has been a major policy goal in both Korea and the U.S. Recently, as foreign capital increasingly owns Korean domestic banks, it is asserted that domestic industrial capital should have a chance to own banks. But, it is not desirable for industrial capital to own banks due to above-mentioned reasons. However, it may not be desirable for a specific capital to overwhelm the market. This paper suggests how to foster domestic financial capital which can compete with foreign capital in the banking industry.

난개발 방지와 계획입지 확대를 위한 산업단지·공장총량 배정 개선방안

이상대,김군수,양세종 경기연구원 2022 정책연구 Vol.- No.-

□ Current status of industrial locations and factory site area in Gyeonggi Province. As of 2020, there are 94,850 factories located in the Capital Region and the total manufacturing facility area is 83,552,000㎡. The number of factory in individual locations is 49,686 as of 2020, accounting for 52.4% of all factories. In Gyeonggi Province, as of June 2019, the number of factories is 68,681, and the ratio of factories in individual locations is 71.3% of total. The total allowable amount of industrial complexes in Gyeonggi Province announced by the Ministry of Land, Infrastructure and Transport is 7,600,000㎡ from 2021 to 2023. As of December 2022, the amount of execution to local government (Shi / Gun) is 7,259,000㎡. The total allowable amount of industrial zone area outside of industrial complexes in Gyeonggi Province is 2,380,000㎡ for 2021-2023, and the remaining amount of execution is 689,000㎡. The total amount of factories site in individual locations in Gyeonggi Province is 2,754,000㎡ for 2021-2023, and remaining amount of permit is 551,000㎡. □ The main direction of allocation and execution of industrial land(industrial complex/industrial area/individual factory site) in Gyeonggi Province Firstly, in accordance with Gyeonggi Provinces innovative growth strategy, that is “improvement of innovation capacity → advancement of industrial structure → concentration of high value-added companies → regional growth”, allocating lots of volume of industrial area should be given to the high value-added industries. Secondly, acquiring additional amount of the industrial lands for industrial complexes and industrial zones needs to the rearragement of existing dis-orderd unfactories. Thirdly, it is evitable to allocate the amount of factory site lands in connection with the establishment of a local governments Growth Management Plan. It needs flexible management of industrial site supply through the practical withdraw of unstarted construction volume. Fourtly, It needs continuously increase the allocation of industrial lands to the city and county (Shi and Gun) in the northern and eastern regions, which are underdeveloped areas. □ Industrial area management by 3 zones of the Capital Region Readjustment Plan In the Growth Management Zone, industrial area allocation should be linked the investment demand of factories and the balance of job-housing ratio. In the Natural Conservation Zone, the develpment project size of industrial complexes should be amended and planned development for factory site should be encouraged. □ Improve the allocating and executing system of industrial land (industrial complex/industrial area/individual factory site) It needs to link allocation among the industrial complex, industrial area, and individual factory site. And, in order to minimize speculative demand for industrial complexes and factory site area and to reflect demand to the allocation program of industrial area, it needs submitting the Shi and Guns ‘factory demand survey report’ to Gyeonggi Provincial Goverment by annual. Finally, It needs the reorganization of administion and processing system for the Geonggi Provincial Government for the efficent allocating and executing system of industrial lands.