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Government-Industry Partnerships for the Development of New Technologies (2003)

Chapter: Global Dimensions: Competition and Cooperation

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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Suggested Citation:"Global Dimensions: Competition and Cooperation." National Research Council. 2003. Government-Industry Partnerships for the Development of New Technologies. Washington, DC: The National Academies Press. doi: 10.17226/10584.
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Global Dimensions: Competition and Cooperation COMPARISONS IN A GLOBAL ECONOMY From an international perspective, understanding the benefits and chal- lenges of programs to support industry is important insofar as they have been and remain a central element in the national development strategies of both industrial and industrializing countries. Governments around the world believe the composition of their economy matters. Accordingly, they have shown a great deal of imagination in their choices of mechanisms designed to support high-technology industries. To support in- dustries and industrial companies based on new technologies many governments have active R&D programs and incentives. Some countries provide major finan- cial support directly to national firms. In some cases this is done overtly through substantial direct grants, loans, loan guarantees, and public equity investments. In other cases, support is provided more opaquely through mechanisms such as tax deferrals, regional aid, worker training, or infrastructure development.1 Some countries employ, as well, a wide range of trade policies from trade regulations designed to protect domestic products from foreign competition to tax rebates intended to stimulate the export of selected domestic products. The growing rec- ognition of the role of science and high-technology industries in encouraging economic growth has led many governments to provide substantial R&D funding for enterprises of particular interest. In addition, as Figure 5 shows, many coun- tries have substantially increased their overall national expenditures on R&D. 1For an overview of the policy goals and instruments, see National Research Council, Conflict and Cooperation, 1996, op. cit., Box B, pp. 39-40. See also Martin Brown, Impacts of National Technol- ogy Programs, Paris: OECD, 1995, especially Chapter 2. 125

126 % of GDP 4.0 4.0 Sweden 3.5 3.5 Finland Japan Japan Sweden 3.0 3.0 USA USA Germany 2.5 2.5 OECD total Germany UK France France 2.0 2.0 Denmark UK Norway Finland Austria 1.5 1.5 Austria Norway Denmark 1.0 1.0 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000 Year FIGURE 5 National expenditure on R&D. Source: OECD, Main Science and Technology Indicators Database

GLOBAL DIMENSIONS: COMPETITION AND COOPERATION 127 Data collected by the Paris-based Organisation for Economic Co-operation and Development (OECD) suggests that government initiatives worldwide that support high-technology industries involve significant resources and are focused increasingly on what policy makers consider strategic industries.2 Pressure to limit public expenditure, comply with international codes (such as those of the World Trade Organization) or regional arrangements (such as the European Union subsidy codes) and the recognition of the risks of open-ended commitments to firms in rapidly evolving markets have led policy makers to focus more attention on the contributions of public-private partnerships.3 In the past decade countries ranging from Japan to Finland to Germany have launched accelerated coopera- tive programs to restore or gain national competitiveness in key industries. EXAMPLES OF INITIATIVES IN OTHER COUNTRIES Cooperative activities are by no means confined to traditional competitors in high-technology industry. Finland has a general program of technology develop- ment called Tekes, which brings together key elements of Finnish technology strategy under a single organization. Parts of Finland’s program have substantial similarities with the ATP. Reflecting the Finnish commitment to investments in new technologies, the Tekes program is funded at a similar level to the ATP. In 2001, Finland, a country of 5.1 million people, funded 2,261 research and devel- opment projects through Tekes with a total value of €387 million as compared with the approximately U.S.$146 million appropriated to the ATP in FY2001.4 Taiwan is another example of a nation committed to a broad-based effort to support high-technology sectors. Government policies in Taiwan have not only pursued capital market reform to create appropriate equity incentives for the growth of high technology but have also contributed substantial support through the ITRI (Industrial Technology Research Institute) established in 1974, and its main R&D facility ERSO (Electronics Research and Service Organization), which is focused on semiconductors. ERSO, originally supported by government funds, has since maintained itself by acquiring contracts. Taiwan further boosted its semiconductor industry by contributing public finds to the formation of UMC (United Microelectronics Corporation) in 1980, as well as initiating funding (with a more than 40 percent stake) for TSMC (Taiwan Semiconductor Manufacturing Company) in 1987. As part of a direct focus on a segment of high-technology 2See Brown, op. cit. 3The OECD, for example, has undertaken valuable work in this area, reflecting the interest of its membership. 4See the Tekes Web site, <http://www.tekes.fi/eng/information/stat00.html> (March 2001). Around €230 million of this funding, in the form of grants and loans, was aimed at company research and development projects, and about €140 million was aimed at university and research institution projects.

128 GOVERNMENT-INDUSTRY PARTNERSHIPS development, Taiwan established the Hsinchu Science Park in the mid-1970s, and it began operating in 1980 directly under the federal government’s National Science Council; the park is now the core of Taiwan’s integrated circuit (IC) industry. Hsinchu park has been credited with incubating most of Taiwan’s IC factories—the bulk of which reside today either in the park itself or nearby. The park employed 83,000 people in 1999—an increase of more than four times from the 19,000 employed there in 1989.5 Together, these policies have had a highly positive impact on the development of high-technology industry, especially semi- conductors, in Taiwan. NATIONAL AND REGIONAL PROGRAMS TO SUPPORT THE SEMICONDUCTOR INDUSTRY The conviction that high-technology industries are fundamental to techno- logical competency, national autonomy, economic growth, and high-wage, high- value-added employment is widespread among the major trading partners of the United States.6 Nowhere is this more apparent than in the semiconductor indus- try. Consequently, many governments have adopted policies to support nation- ally based firms in the hope of capturing the benefits of this industry such as higher wage jobs, increased competitiveness, and future government revenue. Semiconductors are, and have been, the target of national policy, in both the United States and abroad. As Laura Tyson noted in her 1992 study: The semiconductor industry has never been free of the visible hand of govern- ment intervention. Competitive advantage in production and trade has been heavily influenced by policy choices, particularly in the United States and Ja- pan. Some of these choices, such as the provision of public support for basic science, R&D, and education in the United States, have had general, not indus- try-specific objectives. But other choices, such as the provision of secured de- mand for industry output through military procurement in the United States and through preferential procurement of computers and telecommunications equip- ment in Japan, have been industry specific in intent and implementation.7 5For current programs in semiconductors, see National Research Council, Securing the Future: Regional and National Programs to Support the Semiconductor Industry, op. cit. Specifically, see the presentation made by Chien-Yuan Lin of Taiwan University in the Proceedings section of the report. For a well-researched overview of the many national programs in the same volume, see Thomas Howell, “Competing Programs: Government Support for Microelectronics.” 6For a discussion of the importance of high-technology industries to national economies and the measures some countries adopt to capture these benefits, see National Research Council, Conflict and Cooperation in National Competition for High-Technology Industry, National Academy Press, Wash- ington, D.C., 1996, especially box on pp. 33-35. 7Laura D’Andrea Tyson, Who’s Bashing Whom?: Trade Conflict in High Technology Industries. Institute for International Economics, Washington, D.C., 1992, p. 85. For a review of government programs designed to develop and support the technologies underpinning the semiconductor industry, see Thomas Howell, “Competing Programs: Government Support for Microelectronics,” op. cit.

Government - University - Industry Collaboration in Japan (Source: SIRIJ - Semiconductor New Century Committee Report) Government Semiconductor Industry ETL Electronics Industry Semiconductor Association of Japan Industry Industry Research Institute of Japan NEDO Roadmap (ITRS) 1998 SIRIJ 1994 Association of Semiconductor Super-Advanced Semiconductor Leading-Edge Technologies Electronics Tech. Tech. Academia Selete 1996 ASET 1996 Research Center Limited 300mm Small Geometry STARC 1995 Activity Equipment Lithography on Research Research and Material Litho/TCAD Etching Evaluation toward Research on /PFC Plasma DSM Emission Process SoC Device & Architecture & Process Design/Test Needed Needed VLSI Design and Education Center Universities VDEC 1996 30 FIGURE 6 Government-university-industry collaboration in Japan. 129

130 GOVERNMENT-INDUSTRY PARTNERSHIPS As Tyson notes, the U.S. government provided early procurement-based funding to promote the development of semiconductors for both military and space exploration programs.8 Also, as noted earlier, the United States undertook a series of initiatives in the 1980s to help redress the competitive position of the U.S. semiconductor industry. Notwithstanding the success of these policies—or because of them—the U.S. government’s subsequent role in assisting the com- mercial semiconductor sector has been more restrained.9 As a result, the United States presently has no comparable matrix of programs to support the semi- conductor industry.10 This fall-off in R&D support is not confined to semi- conductors. The United States has also reduced the scale of its R&D investment in computers and computer architecture, in both absolute and relative terms.11 The explanation for these reductions is complex, but these U.S. reductions do run contrary to global trends. The lag effects of what have been described as “random disinvestments” may compromise the U.S. government’s ability to achieve other societal goals over the long term. EXPANDING NATIONAL PROGRAMS ABROAD By contrast, governments abroad remain active in supporting their respective semiconductor industries, as Box I indicates. Many governments have adopted policies to launch, revive, or restore their industries. If current policies remain in place, governments abroad will continue to intervene to support high-technology industries using a variety of mechanisms. In spite of the recent pronounced downturn in the global semiconductor mar- ket, many governments remain active in their support of initiatives to promote the development of advanced microelectronics technology, often providing substan- 8Government procurement enabled U.S. firms to improve yield and efficiency through volume production and encouraged wider application of integrated circuit technology, first in military and then in commercial technologies. National Bureau of Standards, The Influence of Defense Procure- ment and Sponsorship of Research and Development on the Development of the Civilian Electronics Industry, June 30, 1977. 9See the paper by Thomas Howell, “Competing Programs: Government Support for Micro- electronics,” in Securing the Future: Regional and National Programs to Support the Semiconductor Industry, op. cit. 10The United States has greatly increased its research expenditures in biomedicine, but as de- scribed above, capitalizing on these investments will require complementary funding for other disci- plines and related information technologies. 11In a recent report for this study, Kenneth Flamm documents this downturn. He notes that this downturn “would not be a source of concern if we were convinced that computing technology had matured” (i.e., that it was no longer an area with a high social payoff for the U.S. economy). Yet the contrary is the case. Given the potential for high-performance computing as a complement to techni- cal advance in other high payoff areas, like biotechnology, Flamm suggests that it would be prudent for the United States “to plant more seed corn in this particular field.” Kenneth Flamm, “The Federal Partnership with U.S. Industry in U.S. Computer Research: History and Recent Concerns” in National Research Council, Capitalizing on New Needs and New Opportunities: Government-Industry Part- nerships in Biotechnology and Information Technologies, op. cit., p. 220.

GLOBAL DIMENSIONS: COMPETITION AND COOPERATION 131 tial incentives to national industries to add manufacturing capacity. Some na- tions are also providing substantial incentive to attract native born and foreign talent to their national industry, in order to meet what some see as an emerging zero-sum competition for skilled labor.12 In doing so, some national programs are altering the terms of global economic competition, with policies that differ in important ways from those of the traditional leaders.13 The levels of investment and promotional activity across many countries attest to the importance governments attach to the semiconductor industry. The emergence of China, for reasons of scale and skill, is likely to pose a major com- petitive challenge, especially as cooperation increases with the highly competent Taiwanese industry. At present China does not account for even one percent of the world semiconductor market, but much new capacity is scheduled to come on-stream.14 In Shanghai, for example, two new fabrication plants (“fabs”) are under construction, another two are on the drawing board, and over a dozen more are in the early planning stages. Elsewhere in Asia, Taiwanese planners in mid-2000 envisioned that a total of 21 new 300mm fabs and 9 new 200mm fabs would be built by the year 2010. The government of Singapore has publicly set a goal of 20 fabs by the year 2005. In South Korea, the government pressured commercial banks to finance the move into chip making by the country’s family-controlled conglomerates.15 Malaysia has opened a $1.7 billion wafer fab and has planned to construct two more.16 Japan, still a major player, is making a vigorous attempt to bring about a “national revival” in microelectronics, by emulating U.S. programs.17 12Thomas Howell, “Competing Programs: Government Support for Microelectronics,” op. cit. 13As Thomas Howell documents through his extensive field research, there is now a broad area of well-funded programs to support national and regional semiconductor industries, as well as the interna- tional cooperation increasingly required in this global industry. See Thomas Howell, “Competing Pro- grams: Government Support for Microelectronics,” op. cit. For example, state-supported producers in Korea, Taiwan, Malaysia, and now China present special challenges in the competition for global mar- kets in high-technology products. The 1996 STEP report identified this trend and predicted that it would accelerate. It has. See National Research Council, Conflict and Cooperation in National Competition for High-Technology Industry, National Academy Press, Washington, D.C., 1996, p. 21. 14“Is China’s Semiconductor Industry Market Worth the Risk for Multinationals? Definitely!” Cahners In-Stat Group (March 29, 1999). According to the World Fab Watch (WFW) database, which is prepared by Strategic Marketing Associates and contains information on over one thousand fabs worldwide, as of this writing, there is a possibility of 84 fabs being constructed for integrated circuit fabrication between 2002 and 2005. This includes production, pilot, and R&D fabs. Of the total, twelve fabs are currently expected to be located in China. Strategic Marketing Associates, World Fab Watch, Santa Cruz, CA, 2002. 15See Thomas Howell, “Competing Programs: Government Support for Microelectronics,” op. cit. Howell’s figures and many of his conclusions are based primarily on personal interviews with industry officials in Asia. This type of field research on national policies for an industry is exceedingly rare in the U.S. 16“The Great Chip Glut,” The Economist, August 11, 2001, <http://www.economistgroup.com>. 17See the presentations of Masataka Hirose, Toshiaki Masuhara, and Hideo Setoya in the Proceed- ings of National Research Council, Securing the Future: Regional and National Programs to Support the Semiconductor Industry, op. cit.

132 BOX I. National Programs to Support the Semiconductor Industry Many nations are actively and substantially supporting initiatives in their respective national semiconductor industries. Some of these programs are listed below: 18 Period of Country Project Project Level of Funding Purpose Japan Next Generation 2001-08 $300 million Process and device technology for 70 Semiconductor ($60 million in 2001)19 mm generation R&D Center (Super clean room) Japan Future Information 2001-06 $300 million Create small-scale, very short-term Society Creation semiconductor production line Laboratory Japan ASET 1995- $500 million Lithography, semiconductor manufac- turing technology Japan Nanotechnology 1985- $350 million in Basic R&D nanotechnology, includes Programs FY2001; METI labs microelectronics themes conducting R&D Japan Selete20 1996- 21 Manufacturing technology for 300-mm wafers Taiwan ASTRO 2000- Government will fund Technology induction, upgrading of lo- half cal industry European MEDEA 1997- $720 million (est.) Process technology, design, applica- Union 2000 tions European MEDEA Plus 2001-09 $1,350 million (est.) Systems-on-a-chip, UV lithography Union Germany Semiconductor 300 1996 $680 million 300 mm wafer technology -2000

European MEDEA 1997 $720 million (est.) Process technology, design, applica Union 2000 tions European MEDEA Plus 2001-09 $1,350 million (est.) Systems-on-a-chip, UV lithography Union Germany Semiconductor 300 1996 $680 million 300 mm wafer technology -2000 France Crolles I and II 1998- $136 million (est.)22 Pilot 300 mm fab United States MARCO 1997- $75 million over 6 years Basic microelectronics R&D United States National Nanotech- 2000- $270 million in 2000 Basic R&D on nanotechnology; includes nology Initiative same microelectronics themes United States DARPA Permanent $192 million in 2000 for Advanced lithography; nanomechnisms; “advanced electronics” electronic modules technology” United Statesa SEMATECH 1989-1996 $850 million Cooperative research facility to bench mark next-generation development of processes, products and tools; forum for information exchange and coordination of research projects. United States EUVL (Extreme 1997- $250 million Advanced Lithography Ultraviolet Lithog- raphy) CRADA23 a International SEMATECH, as its name suggests, involves companies from many countries and does not receive direct U.S. government support. 18See Thomas R. Howell, “Competing Programs: Government Support for Microelectronics,” op. cit. 19METI requested $60 million in FY2001 budget for first year of a 7-year project 20Samsung is also a member of Selete. 21Privately funded but received NEDO contract to develop technology to cut PFC use. 22Crolles I reportedly received support of FF 900 million to FF 1 billion. Additional funds have been requested for Crolles II. 23The EUVL CRADA is in fact an international effort. 133

134 GOVERNMENT-INDUSTRY PARTNERSHIPS This summary of these national programs should not be interpreted as a criti- cism of them. The collective impact of these programs should help the semicon- ductor industry as a whole meet its increasingly complex technical challenges. At the same time, underlying these programs are genuine differences in national attitudes concerning a nation’s knowledge and technology base. Notably, some nations believe the development of a nation’s manufacturing capacity in leading industries to be an appropriate national goal worthy of sustained support.24 In the case of both Europe and Japan, industry leaders are identifying what they see as the main semiconductor growth markets of the 21st century—wireless, wired telecommunications, and digital home appliances. U.S. companies have domi- nated computer applications of semiconductors, and in particular, personal com- puters, whose growth prospects may prove to be more limited in the future.25 COMPETITION AND COOPERATION Competition and cooperation both transcend borders. In the realm of high technology, competition and cooperation are often the two faces of a coin. While competition for high-technology industry is not new, it does seem to be accelerat- ing, as new entrants put in more resources, often in new or expanded organiza- tions.26 Some advocates of free global trade argue against these programs; yet preaching that these activities of trading partners constitute unwarranted inter- vention in the market ignores the origins of many U.S. industries, the interven- tionist tradition of the countries concerned, and the frequent success of these programs. Add to that the fact that exhortations have little effect in international economic relations, especially when nations believe their economic future is at stake. The situation is further complicated by the widespread belief in the need for governments to support many fledgling technologies—although the terms and nature of this aid vary greatly across countries. At the same time, in many industries international cooperation is increas- ingly required to address the cost, complexity, and risk of new generations of 24Some nations pursue consumer welfare as an implicit, if vaguely defined, goal, while other na- tions adopt explicit national economic strategies, designed to pursue national economic strength through the acquisition of the capability to manufacture high-technology products. See National Research Council, Conflict and Cooperation in National Competition for High-technology Industry, op. cit., pp. 12-27 and pp. 51-54. See also Richard Samuel’s Rich Nation, Strong Army: National Security and Technological Transformation of Japan, Ithaca, NY: Cornell University Press, 1994. 25“From Stagnation to Growth, The Push to Strengthen Design,” Nikkei Microdevices (January 2001); “Three Major European LSI Makers Show Stable Growth Through Large Investments,” Nikkei Microdevices (January 2001). See also, Thomas Howell, “Competing Programs: Government Sup- port for Microelectronics,” op. cit. 26For a discussion of national programs to encourage high-technology industry and to capture their benefits for national economies, see National Research Council, Conflict and Cooperation, 1996, op. cit. For a comprehensive review of national programs for semiconductors, see Thomas Howell, op. cit.

GLOBAL DIMENSIONS: COMPETITION AND COOPERATION 135 Box J. International SEMATECH Begun in 1995 to develop common technology for next genera- tion of 300-mm wafers, SEMATECH evolved in 1999 into full interna- tional cooperation in non-competitive semiconductor manufacturing tech- nology.27 International SEMATECH is today the world’s largest semiconductor research consortium. Member companies from the United States, Asia, and Europe are cooperating in key areas of semiconductor technology, sharing expenses and risk. It is important to note that the Japanese producers, with one Korean member, Samsung, have mounted a major but separate consortium called SELETE. Their common aim is to accelerate development of the advanced manufacturing technologies required to build the more powerful semiconductors necessary to sustain the exceptional growth of this industry.28 technologies. The vigorous competition for the benefits of high-technology in- dustry is thus both complicated and complemented by the frequent need for coop- eration to achieve common goals. A cooperative approach to science and technology development is thus one of the hallmarks of the late twentieth century. Cooperation across national fron- tiers is expanding, aided by new communications technologies and motivated by the global nature of many scientific challenges. Within and among nations, coop- eration between governments and industry is expanding to meet national goals and common technological challenges. Strategic alliances among businesses are also expanding dramatically, enabling firms to meet a variety of goals from shar- 27The internationalization of SEMATECH, though it occurred after the end of U.S. government funding, was not without controversy. In the context of international trade, cooperation and competi- tion are often the two sides of the same coin; the judgment to internationalize SEMATECH appears to have rested on the belief that cooperation in this instance would best serve the U.S. industry’s inter- ests. See Thomas Howell, “Competing Programs, Government Support for Microelectronics,” in National Research Council, Securing the Future: Regional and National Programs to Support the Semiconductor Industry, op. cit., for a discussion of cooperative programs. For a discussion of the cooperative and competitive elements in such programs, see National Research Council, Conflict and Cooperation in National Competition for High-Technology Industry, op. cit. 28International SEMATECH addresses areas essential to the continued progress of semiconductor science, including lithography, interconnect, front-end processes, advanced technology, manufactur- ing methods, and environment, safety, and health. International SEMATECH also provides important resources to the semiconductor industry, including coordinating global standards for 300-mm manu- facturing; enhancing relationships between manufacturers and tool suppliers; and developing applica- tion-focused statistical training for the industry. For additional information on International SEMATECH, see <http://www.sematech.org/>.

136 GOVERNMENT-INDUSTRY PARTNERSHIPS ing expertise and costs to establishing global standards and assuring market access for final products. The global nature of many technological challenges and the enormous expense associated with developing new technologies has made interna- tional cooperation an essential element of national science and technology policy. Successful cooperation, both among nations and among firms, requires care and commitment. Care is necessary because much depends on the choice of partner and the clear articulation of goals and responsibilities. The sustained com- mitment of individuals and effective organizations combined with sustained fund- ing are essential for cooperative activities to bear fruit. To fully realize the ben- efits of international collaboration, substantial vision and commitment are required of researchers and policy makers alike. The Committee has sought to foster such cooperation across international borders among researchers and policy makers. At the request of the White House, the State Department, and the European Union, the Academies Committee orga- nized in June 1998 a major two-day conference, convened at the National Acad- emies, to celebrate the signature of the 1997 Agreement for Scientific and Tech- nological Cooperation between the European Community and the Government of the United States of America and to inform the U.S. and European research com- munities of its relevance. While the agreement itself represents a significant achievement, creating a bridge between the R&D systems on both sides of the Atlantic, its full potential can be realized only if it can encourage mutually ben- eficial cooperation.29 The conference served as an important opportunity to publicize the agree- ment within the research community and among policy makers on both sides of the Atlantic. By bringing together experts in substantive areas where opportuni- ties for mutually beneficial partnerships were believed to exist, the conference was able to examine crosscutting issues of common interest in such areas as the framework for R&D cooperation, small business development, and the interna- tionalization of the technical workforce. As intended, the conference identified technology areas of interest to the United States and our European partners, helped to clarify the modalities of U.S.-E.U. cooperation, and furthered mutually benefi- cial science and technology cooperation between the European Union and the United States—two of the premier research areas of the world. 29See National Research Council, New Vistas in Transatlantic Science and Technology Coopera- tion, C. Wessner, ed., Washington, D.C.: National Academy Press, 1999.

VIII CONCLUSIONS

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This report reviews a variety of partnership programs in the United States, and finds that partnerships constitute a vital positive element of public policy, helping to address major challenges and opportunities at the nexus of science, technology, and economic growth.

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