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produces.1 US-based multinational corporations dominated most industrial sectors. In the 1990s, the United States experienced the longest economic boom in its history, driven in large part by investments in information technology and by accelerating productivity.

Central to prosperity over the last 50 years has been our massive investment in science and technology. Government spending on research and development (R&D) soared after World War II, and government spending on R&D as a percentage of the gross domestic product (GDP) reached a peak of 1.9% in 1964 (it has since fallen to 0.8%2). By 1970, the United States enrolled 30% of all postsecondary students in the world, and more than half the world’s science and engineering doctorates were awarded here.3

Today, with just 5% of the world’s population, the United States employs nearly one-third of the world’s scientific and engineering researchers, accounts for 40% of all R&D spending, publishes 35% of science and engineering articles, and obtains 44% of science and engineering citations.4 The United States comes out at or near the top of global rankings for competitiveness. The International Institute for Management Development ranks the United States first in global competitiveness; the World Economic Forum puts us second (after Finland) in overall competitiveness and first in technology and innovation.5

Leadership in science and technology has translated into rising standards of living. Technology improvements have accounted for up to one-half of GDP growth and at least two-thirds of productivity growth since 1946.6 Business Week chief economist Michael Mandel argues that, without innovation, the long-term growth rate of the US economy would have been closer to 2.5% annually rather than the 3.6% that has been the average since the end of World War II. If our economy had grown at that lower


Center for Sustainable Energy Systems, University of Michigan, “US Energy System Factsheet.” August 2005. Available at:


American Association for the Advancement of Science. “US R&D as Percent of Gross Domestic Product, 1953-2003.” May 2004. Available at: Based on National Science Foundation data in National Science Board. Science and Engineering Indicators 2004. NSB 04-01. Arlington, VA: National Science Foundation, 2004. Figure 4-5.


R. B. Freeman. Does Globalization of the Scientific/Engineering Workforce Threaten US Economic Leadership? Working Paper 11457. Cambridge, MA: National Bureau of Economic Research, June 2005. P. 3.


Ibid., p. 1.


IMD. World Competitiveness Yearbook (2005); World Economic Forum. The Global Competitiveness Report, 2004-2005. New York: Oxford University Press, 2004.


G. Tassey. R&D Trends in the US Economy: Strategies and Policy Implications. NIST Planning Report 99-2. Gaithersburg, MD: National Institute of Standards and Technology, April 1999.

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