GLOBALIZATION OF MATERIALS R&D
TIME FOR A NATIONAL STRATEGY
THE NATIONAL ACADEMIES PRESS
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NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance.
This project was supported by the Department of Defense under Award No. MDA972-01-D-0001. Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the sponsors.
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THE NATIONAL ACADEMIES
Advisers to the Nation on Science, Engineering, and Medicine
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COMMITTEE ON GLOBALIZATION OF MATERIALS RESEARCH AND DEVELOPMENT
PETER BRIDENBAUGH, Chair
MILLER ADAMS,
The Boeing Company
ASHISH ARORA,
Carnegie Mellon University
GILBERT BENAVIDES,
Sandia National Laboratories
UMA CHOWDHRY,
DuPont Company
EDWARD DOWLING,
DeBeers Group
GORDON GEIGER,
University of Arizona
JENNIE HWANG,
H-Technologies Group, Inc.
MICHAEL JAFFE,
Rutgers University
ROBERT PFAHL,
International Electronics Manufacturing Initiative
NATALIA TAMIRISA,
International Monetary Fund
XISHAN XIE,
University of Science and Technology Beijing
Staff
MICHAEL MOLONEY, Study Director (from September 2004)
TONI MARECHAUX, Study Director (December 2003–September 2004)
EMILY ANN MEYER, Research Associate (December 2003–April 2004)
MARTA VORNBROCK, Research Associate
LAURA TOTH, Senior Program Assistant
NATIONAL MATERIALS ADVISORY BOARD
KATHARINE G. FRASE, Chair,
IBM
JOHN ALLISON,
Ford Motor Company
PAUL BECHER,
Oak Ridge National Laboratory
CHERYL R. BLANCHARD,
Zimmer, Inc.
BARBARA D. BOYAN,
Georgia Institute of Technology
L. CATHERINE BRINSON,
Northwestern University
DIANNE CHONG,
The Boeing Company
FIONA DOYLE,
University of California, Berkeley
HAMISH L. FRASER,
Ohio State University
JOHN J. GASSNER,
U.S. Army Natick Soldier Center
SOSSINA M. HAILE,
California Institute of Technology
THOMAS S. HARTWICK
ARTHUR H. HEUER,
Case Western Reserve University
ELIZABETH HOLM,
Sandia National Laboratories
ANDREW T. HUNT,
nGimat Company
FRANK E. KARASZ,
University of Massachusetts
CONILEE G. KIRKPATRICK,
HRL Laboratories
TERRY LOWE,
Los Alamos National Laboratory
LINDA SCHADLER,
Rensselaer Polytechnic Institute
LYLE H. SCHWARTZ
JAMES C. SEFERIS,
University of Washington
SHARON L. SMITH,
Lockheed Martin Corporation
T.S. SUDARSHAN,
Materials Modification Inc.
Staff
GARY FISCHMAN, Director
JAMES KILLIAN, Senior Program Officer
MICHAEL MOLONEY, Senior Program Officer
TAMAE MAEDA WONG, Senior Program Officer
BONNIE SCARBOROUGH, Program Officer
HEATHER LOZOWSKI, Financial Associate
TERI THOROWGOOD, Administrative Coordinator
EUGENE CHOI, Research Associate
MARTA VORNBROCK, Research Associate
COLLEEN BRENNAN, Senior Program Assistant
LAURA TOTH, Senior Program Assistant
Preface
The Committee on Globalization of Materials Research and Development was appointed by the National Research Council (NRC) in December 2003 to assess the status and impacts of the globalization of materials science and engineering (MSE) research and development (MSE R&D). The panel was charged to do the following:
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Evaluate existing benchmarks as appropriate to assess the current situation and trends in materials research and development in the global community.
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Identify reasons why U.S. companies may or may not choose to depend on materials research carried out abroad. Assess current laws, policies, and regulations that affect these decisions.
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Identify advances in technology that are driving globalization of materials R&D.
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Assess the impact of the factors mentioned above on the U.S. economy and national security. Include the effect of foreign participation in domestic R&D and the effect of U.S. participation in foreign R&D.
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In light of the above, recommend actions to ensure U.S. access to current materials research and development.
The committee met four times during the course of the study to hear detailed presentations on the issues surrounding globalization and globalization’s impact on the current state of MSE R&D, the U.S. economy, and national security. In
addition, numerous private interviews were conducted with individuals and colleagues in academia, the federal research agencies, and industry. The committee also organized a poll of a self-selected sample of members of the materials community. The committee is grateful to several professional societies—the American Ceramic Society, the American Physical Society, the Federation of Materials Societies, the Materials Research Society, The Minerals, Metals and Materials Society, the Society for Biomaterials, and the Society of Manufacturing Engineers—for their assistance and to John Armor, Tia Benson-Tolle, Keith Bowman, James Daley, Duane B. Dimos, Robert Hawsey, Terry Lowe, John E. Marra, Ozden Ochoa, Greg Schoeppner, Robert Shull, and Kathleen Taylor for their valuable suggestions and their critical input to the committee’s report.
Chapter 1 of this report defines MSE and globalization in the broadest sense and examines the history of globalization and R&D in general. Chapter 2 focuses on indicators for the emergence of global research activity in MSE. Chapter 3 updates the NRC report Experiments in International Benchmarking of U.S. Research Fields (2000) in some of the materials subfields. Chapter 4 examines various U.S. regulatory regimes—export, technology transfer, intellectual property, tax policy, immigration, environmental safety and health, and product approval—that might influence corporate R&D globalization decisions. Chapter 5 discusses the economic and national security impacts for the United States of the globalizing trends in MSE R&D. Chapter 6 presents a series of recommendations based on the conclusions drawn in each of the chapters and aimed at defining a strategy for maintaining access to critical, cutting-edge MSE R&D. Because this study was sponsored by the Department of Defense (DOD), the committee focused much of its attention on analyzing and recommending particular actions for DOD and its agencies.
It is clear to the committee that the United States and other leading industrial nations are experiencing the globalization of MSE R&D. While R&D is moving offshore to support manufacturing facilities in central Europe and Asia, a much more important aspect of globalization is the massive and accelerating investments that foreign governments, most notably China and India, are making in their own R&D infrastructures, particularly education. This trend is occurring at a time when such investments in the United States are falling. The enrollment of foreign students in graduate science and engineering education at U.S. universities is dropping rapidly and that of U.S. students is in free fall. The Organisation for Economic Co-operation and Development (OECD) reports that in 2000, the share of students in China graduating with engineering degrees was about 40 percent while for the United States it was about 5 percent. Clearly, the United States has a serious problem in education that must be addressed at the national/ federal level if it is to maintain its leadership in innovation. The solution to this
problem is too important to our future to be left to local decision makers. Like much of U.S. commerce, the U.S. defense and intelligence communities have been successful because they have had access to a one- or two-generation lead in critical technologies.
It is the committee’s hope that the conclusions and recommendations in this report will help prepare the United States to deal effectively with the globalization of MSE R&D, secure the nation from future threats, and ensure continued access to the best domestic or foreign MSE R&D in the world.
Finally, I wish to thank all the committee members for their insights, inputs, and various contributions to this study. I also wish to thank the staff of the National Materials Advisory Board for their assistance in the development and execution of this study and in the production of this report.
Peter Bridenbaugh, Chair
Committee on Globalization of Materials Research and Development
Acknowledgment of Reviewers
This report has been reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise, in accordance with procedures approved by the National Research Council’s Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for objectivity, evidence, and responsiveness to the study charge. The review comments and draft manuscript remain confidential to protect the integrity of the deliberative process. We wish to thank the following individuals for their review of this report:
John Allison, Ford Motor Company,
Siegfried S. Hecker, Los Alamos National Laboratory,
Don Hillebrand, Argonne National Laboratory,
Conilee G. Kirkpatrick, HRL Laboratories,
Neil E. Paton, private consultant,
Rustum Roy, Pennsylvania State University
Lyle H. Schwartz, private consultant
Richard S. Stein, University of Massachusetts,
Ellen D. Williams, University of Maryland,
Albert F. Yee, University of California, Irvine, and
Joel S. Yudken, AFL-CIO.
Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the conclusions or recommendations, nor did they see the final draft of the report before its release. The review of this report was overseen by Elsa Garmire, Dartmouth College. Appointed by the National Research Council, she was responsible for making certain that an independent examination of this report was carried out in accordance with institutional procedures and that all review comments were carefully considered. Responsibility for the final content of this report rests entirely with the authoring committee and the institution.