IP: Industry Trends in Research Support and Links to Public Research

[Dave Farber <farber () cis upenn edu>]

http://www.nsf.gov/pubs/1998/nsb9899/nsb9899.htm

Industry Trends in Research Support and Links to Public Research (NSB 98-99)


Industry Trends in Research Support and Links to Public Research 
The National Science Board (NSB) is charged with monitoring the health of the 
nation's science and engineering enterprise and advising the President and 
Congress on policy matters pertaining to research and education in the sciences 
and engineering. The release of the new edition of our biennial report, Science 
& Engineering Indicators--1998 (S&EI98),1 provides the Board with an opportunity 
to note and comment on selected findings and trends of particular interest in 
the development of national policy. 

Two important findings documented in S&EI98 involve the capability of U.S. 
industry to develop new products and processes. The first is embodied in dual 
funding trends: namely, a restoration of funding by U.S. industry of its own 
research --representing a turnaround from the cutbacks that began in the late 
1980s--in tandem with its continued--albeit relatively small--investment in 
basic and applied research at universities and colleges. 

The second finding, based on a relatively new analytic technique, suggests that 
patents granted in the U.S. patent system are increasingly linked to public 
research.2 Specifically, inventors in five industrial nations, including the 
United States, are increasingly taking advantage of the results of research 
performed in universities, government laboratories, medical schools, and 
nonprofit organizations. This is especially true in areas where the rate of new 
startup firms is high, such as biotechnology and pharmaceuticals. When American 
inventors cite research journal articles, the cited articles are overwhelmingly 
those produced by U.S. authors. 

Clearly, both industrial investment in research and industrial use of publicly 
funded research have been growing. Thus, investments by industry and government 
continue to complement each other, with public investment--primarily in basic 
research--often serving as a precursor to private sector investment in many 
areas of applied research and development. Federal investment thereby continues 
to provide a critical seedbed for economic growth and for overall growth in job 
opportunities. 

Highlights of these findings and for related indicators are presented below, 
followed by the Board's comments. Technical details are appended. 

Highlights 
Funding Indicators 

  In constant-dollar terms, the amount invested by U.S. industry in its own 
  basic research efforts dropped by a fifth from 1991 through 1995, 3 decreasing 
  from $6.3 billion to about $5 billion. This investment began to rise in 1996 
  and is projected to continue rising by 1997 to an estimated $6.5 billion in 
  current dollars, or $5.7 billion in constant dollars. 

  Similarly, industry financing of its own applied research decreased by about 
  16 percent from 1991 through 1994, but is projected to be up by 37 percent in 
  real terms by 1997 to an estimated $28.6 billion in current dollars. 

  U.S. industry's investment in basic research performed at U.S. universities 
  and colleges increased in real terms by 20 percent from 1991 to 1997, rising 
  to a total of $1.05 billion in 1997 dollars. This represents about 6.5 percent 
  of all academic basic research expenditures.