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This paper deals with the cluster concept for understanding the status of formation and development of innovation clusters in Korea. It identifies the patterns of clusters through overall review of the various clusters in Korea. The study revealed that production clusters were built either by government policy or by investment of large chaebols during the 1960s and 1970s. In the 1980s and 1990s formation of more advanced types of clusters like those of R&D was also initiated by the government. Although there are various types of clusters in Korea, innovation clusters in which firms and related supporting institutes closely inter act and stimulate the innovation process are at a primitive stage. Most clusters are per forming parts of a value-adding chain, lacking many essential capabilities and technopoles needed to sustain regional economic activities. Moreover, there are a number of hurdles for further development of the clusters that leads to innovation clusters.

Mid-entry strategy is an R&D strategy designed for an efficient utilisation of scientific and technological resources across the nations. It chooses the entry point of R&D projects in the mid-stage of technical development. The technological situation of developing countries compels them to choose the mid-entry strategies tailored to specific technologies. The development of the CDMA (Code Division Multiple Access) based digital cellular mobile communication system by ETRI, Korea's government-sponsored research institute, is an example showing the application of this strategy. ETRI utilised scientific resources owned by US based Qualcomm Ltd and co-operated with local companies for the development.In the first half of 1996 the successful commercialisation of the CDMA digital cellular telephone service was launched in Korea, ahead of all other countries. Two Korean mobile communications providers have adopted the system.

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