Empirical assessment of R&D strategies and technology stocks in the Korean gas industry

Summary form only given as follows. A balanced and efficient allocation of R&D resources is a crucial element of corporate strategies aimed at enhancing firms´ competitiveness. This paper evaluates R&D strategy of Korea Gas Corporation (KOGAS), a monopolistic state-owned gas company, with respect to efficiency of its project selection and technology stock accumulation. We measure technology stocks and their associated spillovers in order to assess the extent of allocative efficiency of R&D expenditure across a set of peer groups of research and development projects. We also combine the technology relation analysis with the measurement of the technology stock, although the two have been heretofore considered to be separate analytical tools. Technology stocks of 45 peer projects were evaluated, allowing us to derive a technology map of R&D fields of KOGAS. Our empirical findings imply that, in allocating its R&D resources, KOGAS was putting too much emphasis on operation and maintenance of its facilities. We therefore suggest that KOGAS may wish to reallocate its R&D resources to other research areas such as the development of new energy sources, participation in the overseas gas markets and design of the strategies conducive to its becoming what its vision is: being a world-class energy company