54 PERSPECTIVES ON BUSINESS AND ECONOMICS | VOL 43 | 2025 try, which has proven profitability and is particularly well suited to leverage already existing strengths in infrastructure and skilled workforce. Education infrastructure Taiwan’s 6-3-3-4 education system is consistent with most educational structures around the world, where students have six years of elementary school, three years of middle school, three years of upper secondary school, and four years of a college education (Ku & Lin, 2022). In terms of higher education, Taiwan has substantially expanded, from just seven universities in 1950 to 164 in 2008 (Ministry of Education, 2008). Aiming to improve global competitiveness, in 2000, the Ministry of Education initiated an array of funding programs (Chang et al., 2009). One program launched in 2003 was the World-Class Research University Project, formerly known as the Higher Education for Excellence Plan, which provided ~US$1.6B to qualified universities. The competitive program selected only 12 universities in 2005 for additional funding over five years, which was renewed in 2011 to further promote international collaboration and publication (Chou & Chan, 2016). Ten years later, the participating institutions saw significant improvement in global rankings and research productivity. In 2015, QS World University Rankings rated National Taiwan University seventieth globally, maintaining its status as a top 100 university since its first breakthrough in 2009 (QS World University Rankings, 2015). One of the premier research institutions, National Tsing Hua University, currently ranks in the top 10 universities worldwide for universities, with fewer than 1000 faculty members, as well as in the top 20 worldwide for number of US patents received (Charting Taiwan’s scientific…, 2020). A 2020 survey conducted by the Ministry of Education showed a gradual decline in the percentage of college students in science, technology, engineering, and mathematics (STEM) departments, from 35.4% in 2011 to 31.8% in 2020 (National Development Council, 2021). In response, Taiwan recently elevated STEM as a priority in the official curriculum, reflected in the Ministry of Education’s establishment of three major policy initiatives: increasing STEM enrollment by 10%–15%, reducing teacher-student ratios in STEM classes, and creating more interdisciplinary programs involving STEM fields. Moreover, governmental support for STEM camps and competitions has increased (Ku & Lin, 2022). Thanks in part to these efforts, in 2021, the International Institute for Management Development World Digital Competitiveness Ranking reports rated Taiwan seventh globally for preparedness to exploit digital transformation and fifth for the proportion of college graduates in sciences (Ku & Lin, 2022). Given its history of cultivating and closely monitoring education, and its particular strength in STEM disciplines, Taiwan is well positioned to capitalize on its STEM foundations when considering alternative industries for economic development. Technology infrastructure Taiwan has an abundance of tech incubators to facilitate cross-collaboration between start-ups. In 1994, the Small and Medium Enterprise Administration within the Ministry of Economic Affairs began encouraging the establishment of small and medium-sized enterprise innovation incubators by supporting state-owned and private sector enterprises. Over the next six years, nearly 60 incubators were set up as part of the plan to stimulate economic services to start-ups (Wang et al., 2013). One of the few incubators present before this initiative, the ITRI—from which TSMC had originally spun off—has benefited tremendously from this ecosystem (Jan & Chen, 2006). Since 2001, ITRI has spawned over 80 new tech firms (Wong et al., 2015). ITRI has grown to encompass 12 individually specialized R&D campuses, spanning biomedical devices, nanotechnology, mobile communications, and flat panel displays. ITRI’s headquarters is within Hsinchu Science Park (HSP), an internationally renowned hub for high-tech companies to collaborate with academic institutions. HSP attracts companies with incentives such as tax holidays for the first five years and tax concessions on industrial upgrading initiatives (Wong et al., 2015). HSP also boasts six research laboratories, from the National Nano Device Laboratories to the National Space Organization, further encouraging cross-collaboration in technology (Wong et al., 2015). Given the array of existing, supportive infrastructure, investing in a technology-based sector as an alternative to semiconductors is especially attractive. Investing in the intangible The production of semiconductors is vulnerable to supply chain disruptions, global market fluctuations, and the ongoing tensions with China. Investing in an intangible industry is a strategic approach to circumventing these issues. An intangible industry does not depend on a physical product, instead providing information goods. This process follows the current trend in knowledge-based economies of dematerialization, where intangible products, such as R&D, licensing, design, and logistics, provide immaterial elements or services that diverge from the traditional view of prod-
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