r&d

The National Academies of Sciences, Engineering, and Medicine recently released its report on the state of the U.S. National Nanotechnology Initiative (NNI) — authorized by the 21st Century Nanotechnology Research and Development Act of 2003 to coordinate the nanotech-related R&D activities of 26 federal agencies — finding that although the U.S. has maintained a strong program it is increasingly challenged by international competitors. Specifically, the report names China as the primary contender for the U.S.’ spot at the top and attributes its success to strong Chinese leadership and commitment to substantial investment in the field. Looking toward the future, the authors reevaluated the NNI’s stated goals, identified three priorities to ensure the NNI vision can be carried out moving forward, and conclude with five key recommendations needed to meet these priorities and carry out the NNI vision.

A bipartisan, bicameral group of legislators have introduced bills that would make a five-year commitment to increase America’s investment in R&D by $100 billion, while also investing $10 billion in regional technology hubs. Senators Chuck Schumer (D-NY) and Todd Young (R-IN) and Representatives Ro Khanna (D-CA) and Mike Gallagher (R-WI) introduced the Endless Frontiers Act, which articulates both investments.

On Monday, Maine Gov. Janet Mills and Mayor Kate Snyder gathered on Portland’s waterfront for the unveiling of a $100 million research institute designed to drive innovation, talent and economic growth in Portland, the region and the state of Maine. Silicon Valley investor, entrepreneur and Maine native, David Roux, has donated the large sum to Northeastern University to create Roux Institute, a research center that will award certificates, master’s degrees, and Ph.D.’s in artificial intelligence (AI) and machine learning. The institute will train data scientists and computer programmers and ultimately, it is hoped, create an environment and economy conducive to innovation and technology, and reducing the current inequality Portland faces in those areas.

A new report underscores the shifting position of the United States in the global R&D competition and the continuing rise of China. While two charts from the National Science Board’s The State of U.S. Science and Engineering summarize the changing nature of this international struggle, the underlying data on where the U.S. and China are investing their resources should really grab the attention of policymakers and one would hope motivate action by the U.S.

Taking a deeper dive into R&D expenditures at U.S. institutions of higher education, this week’s edition of Useful Stats examines the fields in which this R&D was performed at the metropolitan level in 2018. Expanding on a previous SSTI report showing that R&D activity at universities and colleges is clustered heavily on the coasts, this analysis uses the NSF’s Higher Education R&D (HERD) data on the research expenditures at individual institutions to determine how this funding is distributed among the various fields of study, with life sciences outpacing all other fields.

As shown in the map below, HERD expenditures in the life sciences (primarily the biological, biomedical, and health sciences) accounted for the vast majority of all higher education R&D activity in the U.S. — accounting for 57.8 percent ($45.8 billion) of the total performed in 2018. Engineering R&D was a distant second, accounting for 15.6 of the total.

Brookings and the Information Technology and Innovation Foundation (ITIF) are proposing a new concentration of federal investment into 10 metros with a goal of creating new innovation hubs. The Case for Growth Centers is likely an early entry of what will be many suggestions between now and next November for “massive federal” policies, but may be one of the most directly relevant to regional innovation economies. More details on their proposal and its potential impacts follow.

This week’s edition of Useful Stats covers Higher Education Research & Development (HERD) expenditures at the metropolitan level, pulling from the recent NSF updates to its HERD performance data. High levels of college and university R&D activity is not surprisingly clustered heavily in the East Coast — ranging from the District of Columbia up to Boston — and on the West Coast in California. The 10-year average HERD expenditures were the greatest in the New York-Northern New Jersey metro area ($3.7 billion), Boston ($2.8 billion), Baltimore ($2.8 billion), Los Angeles ($2.6 billion), and Houston ($2.0 billion). These five metro areas account for nearly 21 percent of the nation’s total 10-year average R&D spending by universities and colleges. Of the 209 metro areas included in this analysis — and excluding nonmetropolitan areas — the top 15 metros account for approximately 45 percent of the 10-year average of total HERD expenditures.

Across the U.S., the federal government provided 53 percent of R&D funding at institutions of higher education in FY 2018. Those institutions provided 26 percent of the funding themselves, and most of the remainder was provided by a mix of nonprofit organizations (7 percent), industry (6 percent), and state and local government (5 percent). The specific contributions varied from state to state, however, with some relying more on specific relationships to support R&D within the state.

Expenditures in higher education R&D (HERD) grew in FY 2018, increasing by $4.1 billion over FY 2017, the largest year-over-year increase since FY 2010-2011 according to an SSTI analysis of recently released data from the National Science Foundation’s National Center for Science and Engineering Statistics. For the 10-year period from FY 2009 to FY 2018, HERD grew by 38.4 percent nationally, representing an increase of nearly $22 billion. Higher education R&D expenditures grew the fastest over this 10-year period in the District of Columbia (78.2 percent), Connecticut (65.5 percent), Washington (59.5 percent), and Utah (59.3 percent). The largest absolute gains over the same period were seen in California ($2.5 billion increase), New York ($2.3 billion), and Pennsylvania ($1.6 billion). The map below shows the one-, five- and 10-year percentage changes in each state’s higher education R&D expenditures.

The importance of business and industry R&D investment for competitiveness and economic growth is a well-entrenched dictum of national and state innovation policy across most of the developed world. Approaches for incentivizing increased research expenditures fall into two broad categories, direct grants and subsidies to offset R&D costs or R&D tax credits companies may take post-investment for research expenditures. Direct subsidies or competitively awarded grant programs optimally target specific activities, desired outcomes and performance milestones (e.g., the SBIR/STTR programs). A new paper looks at which approach – direct subsidies or R&D tax credits – actually works better for achieving at least one of the stated policy goals: increasing competitive, private R&D investment?