Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future

TABLE 2-1 Annual Rate of Return on Public R&D Investment

Studies	Subject	Rate of Return to Public R&D (percent)
Griliches (1958)	Hybrid corn	20-40
Peterson (1967)	Poultry	21-25
Schmitz-Seckler (1979)	Tomato harvester	37-46
Griliches (1968)	Agriculture research	35-40
Evenson (1968)	Agriculture research	28-47
Davis (1979)	Agriculture research	37
Evebsib (1979)	Agriculture research	45
Davis and Peterson (1981)	Agriculture research	37
Mansfield (1991)	All academic science research	28
Huffman and Evenson (1993)	Agricultural research	43-67
Cockburn and Henderson (2000)	Pharmaceuticals	30+
SOURCE: A. Scott, G. Steyn, A. Geuna, S. Brusoni, W. E. Steinmeuller. “The Economic Returns of Basic Research and the Benefits of University-Industry Relationships.” Science and Technology Policy Research. Brighton: University of Sussex, 2001. Available at: http://www.sussex.ac.uk/spru/documents/review_for_ost_final.pdf.

fueling inflation. Policy-makers previously focused almost entirely on changes in demand as the determinant of inflation, but the surge in productivity showed that changes on the supply side of the economy could be just as important and in some cases even more important.¹² Such data serve to sustain the US commitment to invest substantial public funds in science and engineering.¹³

Of equal interest are studies of the rate of return on private investments in R&D.¹⁴ The return on investment to the nation is generally higher than is the return to individual investors (Table 2-2).¹⁵ One reason is that knowledge tends to spill over to other people and other businesses, so research results diffuse to the advantage of those who are prepared to apply them.

¹²	E. L. Andrews. The Doctrine Was Not to Have One; Greenspan Will Leave No Road Map to His Successor. New York Times, August 26, 2005. P. C1.
¹³	US Congress House of Representatives Committee on Science. Unlocking Our Future: Toward a New National Science Policy (the “Ehlers Report”). Washington, DC: US Congress, 1998. The report notes that “the growth of economies throughout the world since the industrial revolution began has been driven by continual technological innovation through the pursuit of scientific understanding and application of engineering solutions.” P. 1.
¹⁴	Council of Economic Advisors. Supporting Research and Development to Promote Economic Growth: The Federal Government’s Role. Washington, DC: White House, October 1995.
¹⁵	Center for Strategic and International Studies. Global Innovation/National Competitiveness. Washington, DC: CSIS, 1996.

Table of Contents

Front Matter R1-R26

Executive Summary 1-22

1 A Disturbing Mosaic 23-40

2 Why Are Science and Technology Critical to America's Prosperity in the 21st Century? 41-67

3 How Is America Doing Now in Science and Technology? 68-106

4 Method 107-111

5 What Actions Should America Take in K–12 Science and Mathematics Education to Remain Prosperous in the 21st Century? 112-135

6 What Actions Should America Take in Science and Engineering Research to Remain Prosperous in the 21st Century? 136-161

7 What Actions Should America Take in Science and Engineering Higher Education to Remain Prosperous in the 21st Century? 162-181

8 What Actions Should America Take in Economic and Technology Policy to Remain Prosperous in the 21st Century? 182-203

9 What Might Life in the United States Be Like if It Is Not Competitive in Science and Technology? 204-224

Appendix A Committee and Professional Staff Biographic Information 225-240

Appendix B Statement of Task and Congressional Correspondence 241-248

Appendix C Focus-Group Sessions 249-300

Appendix D Issue Briefs 301-302

K–12 Science, Mathematics, and Technology Education 303-324

Attracting the Most Able US Students to Science and Engineering 325-341

Undergraduate, Graduate, and Postgraduate Education in Science, Engineering, and Mathematics 342-356

Implications of Changes in the Financing of Public Higher Education 357-376

International Students and Researchers in the United States 377-396

Achieving Balance and Adequacy in Federal Science and Technology Funding 397-414

The Productivity of Scientific and Technological Research 415-422

Investing in High-Risk and Breakthrough Research 423-431

Ensuring That the United States Is at the Forefront in Critical Fields of Science and Technology 432-443

Understanding Trends in Science and Technology Critical to US Prosperity 444-454

Ensuring That the United States Has the Best Environment for Innovation 455-472

Scientific Communication and Security 473-482

Science and Technology Issues in National and Homeland Security 483-500

Appendix E Estimated Recommendation Cost Tables 501-512

Appendix F K–12 Education Recommendations Supplementary Information 513-516

Appendix G Bibliography 517-536

Index 537-564