Environment and Planning A, 1993, volume 25, pages 81-93 Industrial restructuring and the spatial division of labor: the case of the Seoul metropolitan region, the Republic of Korea S O Park Department of Geography, College of Social Sciences, Seoul National University, Seoul 151-742, Korea Received 19 September 1991; in revised form 10 January 1992 Abstract. This paper is an overview of an industrial restructuring and spatial division of labor in the Seoul metropolitan region, with a focus on the role of the Korean government, corporate strategy, and regional characteristics in controlling labor and capital. The spatial division of labor that appeared in the 1970s was related mainly to the Korean government's promotion of the rise of large enterprises to institutionalize heavy and chemical industrial development. Since the 1980s, in addition to the role of the state, corporate strategy and regional characteristics have been regarded as important factors for understanding the undergoing industrial restructuring. Concentration and development of high-tech industries in the Seoul metropolitan region during the 1980s have progressed with evolving intensified spatial division of labor beyond the spatial separation of headquarters and production units. The evolution of intensified spatial division of labor is the result of corporate strategy which regionally separates technical workers from production workers on the one hand, and corporate strategy in utilizing regional characteristics from the government's decentralization policy on the other hand. 1 Introduction During the last three decades Korea has experienced remarkable industrial development and economic growth. The rapid industrialization in Korea has accompanied significant changes in industrial structure and organization, in the dynamics of the spatial pattern of industry, and in the spatial division of labor. In recent years especially, Korean industry has been undergoing a process of significant restructuring which is different from that experienced in the 1970s. Roles of the state, corporate strategies, and regional characteristics can be regarded as three important factors for understanding the industrial restructuring and spatial division of labor in Korea. In general, a firm's strategy is considered to be a crucial factor for industrial restructuring in developed countries, as discussed by G Clark (1993). In Korea, however, the state government played an important role in industrial restructuring by regulating both capital and labor. The state may create and maintain conditions conducive to economic growth and industrial restructuring by such means as "(a) manipulating demand, money supply and interest rates; (b) managing foreign investment and trade; (c) controlling access to raw materials; (d) supplying physical infrastructure and a suitably trained, compliant labor force; (e) regulating the activities of businesses with respect to each other, to labor and to markets; (f) providing subsidies, grants and loans; and (g) owning, to a greater or less extent, the means of production" (Linge and Rich, 1991, page 4). By the regulation of capital and other incentive measures, the Korean government promoted the rise of large-scale conglomerates, or Jaebuls, in the period of industrialization in the chemical and heavy industries in the 1970s. The government also regulated labor by directly controlling wages. Increasing labor productivity while maintaining low wages was the important component in creating international competitiveness of industry. Through the direct and indirect regulation of capital and labor, the government played a crucial role in fundamentally framing the industrial transformation and spatial division of labor.