Re Federal R&D Spending

["Dave Farber" <dave () farber net>]

---------- Forwarded message ---------
From: jpaul.subscribes () cox net <jpaul.subscribes () cox net>
Date: Tue, Mar 21, 2017 at 2:36 AM
Subject: [IP] Federal R&D Spending
To: <farber () gmail com>


Greetings, Dr. Farber,  With regard to the discussion of publicly-funded
R&D, note that the European Commission issued this Policy Brief ("The
economic rationale for public R&I funding and its impact") on March 16.

James H. Paul

From the Commission's News Alert (
http://ec.europa.eu/research/index.cfm?pg=newsalert&year=2017&na=na-160317)
announcing the study:
Public investment in research and innovation more important than ever, new
study confirms Saint Julian's, Malta, 16 March 2017

    "Public funding of research and innovation (R&I) acts as a catalyst to
boost private R&I activities and overall economic growth, according to a
report <http://bookshop.europa.eu/uri?target=EUB:NOTICE:KI0117050:EN> (
http://bookshop.europa.eu/uri?target=EUB:NOTICE:KI0117050:EN) released
today by the European Commission. The study, which reviews existing
empirical literature, underlines that the role of public R&I funding is
especially important in light of today's rapidly changing and riskier
innovation landscape.
    "Carlos Moedas, Commissioner for Research, Science and Innovation said:
'*The study demonstrates once again the importance of public investments in
research and innovation. Such investments are necessary to boost excellent
research and support new forms of radical, market-creating innovation often
driven by digitalisation*.'
    "The Commission presented the study during today's meeting of the
European Research Area and Innovation Committee (ERAC) in Saint Julian's,
Malta. The report will be submitted to the high level group of experts
chaired by Pascal Lamy, President Emeritus of the Jacques Delors Institute,
who advises the Commission on how to maximise the impact of the EU's
investment in R&I.
    "The study finds that roughly two thirds of economic growth in Europe
can be traced back to innovation. It also estimates that the typical
returns for private R&I investment range between 10% and 30%. These returns
can be twice or three times higher for the economy in general, thanks to
the positive spillover effects that enable other firms to benefit from
these investments.
    "Public R&I investment helps generate and diffuse new knowledge. It
also contributes to developing new skills and creating networks that enable
stronger knowledge flows. Overall, the returns on public R&I investment are
estimated to be around 20%, with returns on EU-funded R&I estimated to be
even higher.
    "However, for public R&I funding to have maximum impact, it should
cover the whole cycle of innovation, from fundamental research to
market-creating innovation – i.e. solutions or products that completely
re-shape markets.
    "The study also examines the factors that have contributed to a
temporary slowdown in Europe's productivity. It argues that the
digitisation of our economies in the past decades has revolutionised the
way in which innovation works and how its benefits are diffused, with a
growing concentration of innovation benefits with some key players. This
has broad implications for public innovation policy.



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