Measuring the Science and Engineering Enterprise Priorities for the Division of Science Resources Studies (2000) / Chapter Skim
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5 Research and Development: Funding, Performance, and Innovation
5 Research and Development: Funding, Performance, and Innovation
Pages 79-99
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From page 79... ...
Towards the end of WWII, Vannevar Bush, director of the wartime Office of Scientific Research and Development, saw that successful coordination of scientific research to solve the war effort's technical issues could be profitably continued in peacetime to promote the nation's health, economic well-being, and national security. While beginning his work under the Roosevelt administration, Bush delivered to President Harry Truman his 1945 report, Science: The Enclless Frontier, which provided the rationale and targets for federal investments in a federally-supported science and engineering enterprise that has continued into the 1 990s (Bush 1945~.
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From page 80... ...
There have been substantial increases in industry R&D expenditures overall, sizeable increases in the proportion of industrial R&D performed in the service sector, and changes in the structural organization of industrial R&D and innovation. First, industry has been the largest source of R&D funding in the United States for almost two decades, and its share continues to grow.
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From page 81... ...
Meanwhile, federal R&D expenditures, which grew 60 percent in real terms from 1975 to 1987 and closely tracked the aggregate amount of industry spending during that time, has since declined by more than 20 percent in constant dollars. An important result of the declining defense share in federal and national R&D funding has been a shift in funding for development from government to industry.
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From page 82... ...
':~: ~ 1 1 1 11 __ _ ~ . 1 1 L 1 1 1 _ 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 Industry Development Federal Development 0 Industry Applied Research 0 Federal Applied Research LndustIy Basic Research Federal Basic Research Source: National Science Board, Science and[Engineeringindlicators 1998, Appendix Tables 4-10, 4-14, 4-18 (1996 and 1997 data are preliminary)
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From page 83... ...
For example, the National Cooperative Research Act of 1984 (NCRA) has provided firms that collaborate on "generic, pre-competitive research" with certain protections in the event of private suits and limited damages in the event that cooperative R&D is later found to be in violation of anti-trust statutes.
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From page 84... ...
In constant dollars, federal development expenditures increased almost 50 percent from 1980 to 1988 before declining again to the 1980 level in 1996. Similarly, federal expenditures on applied research increased more than 40 percent from 1980 to 1990, but the subsequent decline has not been as steep as for development.
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From page 85... ...
revealed that, in the ~ 990s, increases in funding for the National Institutes of Health and other mission agencies along with cuts in defense spending may be creating long-term increases in some fields and decreases in others. For example, between 1993 and 1997, overall federal spending increased in the biological sciences, medical sciences, aeronautical engineering, computer sciences, materials engineering, and oceanography.
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From page 86... ...
has observed that recent federal obligations for academic R&D may continue these trends in funding by field and warns that it is important to invest "in a balanced way across a broad range of fields to maintain the overall health of the science and technology portfolio." COSEPUP notes that federal obligations for academic R&D would increase by 16.6 percent in constant dollars from FY 1997 to FY 2000 under the President's budget proposal. However, when funding from the
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From page 87... ...
domestic market which "remains that largest high-income region that possesses unified markets for goods, capital, technology, and labor." Another is a federal policy structure that supports economic experimentation through appropriate competition policies, intellectual property rights, and "large-scale federal funding of R&D in universities and industry" (Mowery 1999~. While government investment in R&D is held to be positive, how the government invests funds in R&D is an important policy issue that requires relevant data for proper analysis.
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From page 88... ...
This was initially added as a quality control measure, but it consequently provided meaningful information on outsourced R&D and R&D performed by foreign subsidiaries. The Census determined that companies could report foreign R&D by country and added this 88
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From page 89... ...
in February 1997. The report summarizing the workshop's findings maintains that SRS should collect data by administering RD-1 to business units: In an economy in which large, complex, multiproduct firms perform most R&D activities, the business unit represents a more homogeneous set of activities, whereas combining responses on a range of variables for a variety of products and processes will obscure significant industry-specific conditions that affect technological innovation.
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From page 90... ...
Of considerable importance, though, is whether data collected at the business unit level could be aggregated to the firm level, since other economic data to which RD-~ might be linked are available at that level. R&D and Innovation David Mowery argues that current R&D expenditure data do not provide adequate information on many activities contributing to innovation such as "investments in human resources and training, the hiring of consultants or specialized providers of technology-intensive services, and the reorganization of business processes." He also contends that R&D expenditure data "do not shed much light on the importance or content of the activities and investments essential to inter-sectoral flow and adoption of information technology-based innovations." He notes further that in such nonmanufacturing industries as trucking or food retailing R&D inputs may not be adequately captured because they are indistinguishable from other corporate expenses on operations, materials, or marketing.
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From page 91... ...
Human resources data could potentially shed light on technological diffusions between sectors and fields as seen in career mobility, the nature and extent of intra- and intersectoral partnerships and alliances, and the locational aspects of R&D and innovation. An examination of how human resources data could be used to characterize research utilization and industrial innovation would also provide an excellent opportunity for SRS to examine how data sets could be linked to improve analytical range and depth, as we also recommend elsewhere.
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From page 92... ...
For example, SRS might explore whether detailed data on the extent of industry-university partnerships could be collected through the Survey of Research and Development Expenditures at Universities and Colleges. Currently, this survey asks for the aggregate amount of R&D funding the institution received from industry, but it could also ask for this amount to be disaggregated by field as it does for total expenditures and federally funded expenditures, thereby providing more detail in this area.
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From page 93... ...
Data on resources for the science and engineering enterprise should inform the process for allocating federal research investments and the examination of the federal science and technology budget (NRC 19951. Priority Setting In Federal Science and Technology Allocating Fecleral Funds laid the groundwork for subsequent debate about resource allocation by focusing on the "federal science and technology" (FS&T)
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From page 94... ...
The Board recently recognized in its Strategic Plan that the Academies' report on Allocating Fecleral Funds laid "the foundation for future efforts in what remains a formidable challenge." Still it has noted that "presently, there is no widely accepted way for the federal government, in conjunction with the scientific community, to make priority decisions about the allocation of resources in and across scientific disciplines." The Board has argued that this is true both of the OMB budget process and the congressional appropriations process. While recognizing that this is a "difficult and controversial" task, the NSB has determined to "conduct a state of the art assessment for methodologies for priority setting for research, including an examination of the experiences of other countries" (NSB 199861.
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From page 95... ...
Interviews conducted for this study suggested that agency respondents work with contract classification systems that may have evolved long ago and may no longer fit current classifications of fields in science and engineering. In addition, the budget officer who is the respondent to the federal funds survey may base the field classification on the title of particular procurement in a very subjective way.
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From page 96... ...
At the same time, agencies must be very careful about how they do make changes when they are warranted. For example, a recent analysis using data from the Federal Funds Survey found that it was 96 difficult to track changes by fine field over time because the National Science Foundation, in responding to the survey, had changed its procedures for classifying research obligations by field beginning in fiscal year 1996.
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From page 97... ...
In a recent analysis of trends in federal spending on science and engineering research, Michael McGeary and Stephen Merrill sought to examine how such trends have affected funding for specific science and engineering fields, and moreover, graduate training in those fields. While they were able to look at trends in federal support for graduate training in a very broad way, the differences in field taxonomy for the Federal Funds Survey and the Survey of Graduate Students and Postdoctorates in Science and Engineering made it difficult to associate changes in federal research by field with changes in graduate training by fine field (NRC ~ 999, Appendix A)
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From page 98... ...
SRS should continue to investigate how the extent of multidisciplinary research may be obtained through surveys in both its R&D and human resources statistics programs. The division should consider holding a workshop or commissioning a study to better understand the nature and extent of this phenomenon and how to implement changes consistently throughout its data collection activities, as needed and where possible.
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From page 99... ...
It should examine the feasibility of posing a one-time question to obtain an estimate of the costs associated with future renovation of the academic research infrastructure. Data on these requirements, especially in light of ongoing concerns about federal reimbursement of indirect costs, would help plan for an orderly renewal of academic infrastructure.
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