Thursday, February 17, 2005

(YET) ANOTHER WARNING ABOUT US TECH INNOVATION: The Task Force on the Future of American Innovation, created by leading US companies and scientific and business associations, sounded an alarm with a report indicating that the United States was gradually slipping as the world leader in scientific and technological research.

The signs of trouble outlined in the report range from a slowdown in the growth of technical research to stagnant government funding for fundamental sciences.

As the US share in global high-tech exports was dropping, China, South Korea and other emerging Asian economies boosted theirs from seven percent in 1980 to 25 percent in 2001, according to the study.

While technological article output over that 14-year period increased 13 percent in the United States, in Western Europe it went up by 59 percent, in Japan by 67 percent, while countries such as China, Singapore, Taiwan and South Korea it jumped a whopping 492 percent.

However, US patent applications from China, India, Singapore, South Korea and Taiwan grew by 759 percent over the 1990s while similar applications in the United States increased only by 116 percent, the report said.

I don't really buy into these types of stories, as they have been legion since the 1970's (remember when the press was predicting that Japan would own most US businesses in the 1980's?). Also, some of the premises - such as government funding for research - is a red herring. Just because you're blowing large wads of cash on research doesn't mean that you are being productive or efficient. Many of the technological imports from overseas happen because of the cheap cost of manufacturing and labor. Finally, while the report cites percentages as a basis for their comparison, this ignores the actual output of a particular country o business.

For example, if my company filed 20 patents in 1995, and I filed 100 patents in 2004, this would reflect a 500% increase in my patent filings. This is certainly a great improvement, but you would be hard-pressed to argue that I am now poised to overtake IBM.

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