The rapid growth of Finland’s high-technology economy is often seen as testament to long-term strategic planning, systematic investment, and the ability to adopt innovative policies more quickly than other nations. In the 1970s, Finland’s political leaders, research community, and labor unions engaged in planning to focus R&D funding in electronics, biotechnology, and materials technology. Sustained government support paid off, as electronics-based exports grew from 4% of Finland’s economy in 1980 to 33% of all exports in 2003.a Today, Finland’s private and public sectors invest 3.5% of GDP into R&D programs (ranked second in the world), and the proportion of its population working as research scientists is the highest in the world.b
South Korea recently established an agency to coordinate innovation policies and R&D strategies within the Ministry of Science and Technology. Almost 40% of all postsecondary degrees awarded there are in science and engineering, compared with 15% in the United States.a The government is seeking to double its expenditures on R&D between 2002 and 2007.
Singapore; and Box 8-7, Canada). There are strengthening signs that changes in US tax policy are needed to encourage investment in America. The flexibility of US capital markets, particularly for financing small, high-technology enterprises through venture capital and public stock offerings, had been one of our major strengths, encouraging companies to focus their innovation in the United States. The rapid rise of venture capital in the late 1990s, however, was followed by the precipitous collapse of the technology