Home | Business News | Browse by Publication | R | Research Technology Management

R&D in the financial crisis.

Article Excerpt
R&D at NASA, NSF, NIH, and DOE has fared very well in the new U.S. administration's stimulus plan. But what role does R&D really play during a financial crisis? Where does it fall on the list of economic priorities for the nation when there is a long list of organizations that need financial support?

R&D funding certainly creates jobs for scientists in the same way that infrastructure funding creates jobs for construction workers or defense funding creates jobs for engineers and manufacturing workers. But which is more immediately stimulative--a dollar spent in a research lab or a dollar spent on the highway? Both investments provide jobs today and finished products tomorrow. Research funding might lead to a new synthetic material or energy source in 10 years. A new highway or bridge might lower transportation costs and increase economic activity between regions that lie along its path.

The effects of R&D spending on the national economy were the subject of a 2007 study by the U.S. Bureau of Economic Activity and the NSF. This study showed a direct growth in GDP for industrial sectors that rely heavily on R&D (I). Until recently, economists have measured R&D in the same way that they have measured infrastructure, the cost to create a physical facility (2). But economists are trying to change this. They have realized that the historical link between innovation, R&D and new jobs seems to have stopped (2). In the 2009 edition of the annual NSF R&D survey, 40,000...

View this article FREE - Now for a Limited Time, try Goliath Business News
Free for 3 Days!