"RESEARCH AND DEVELOPMENT: Where Is the New Science in Corporate R&D?"

Read the full article by Jerry Thursby and Marie Thursby in Science (8 December 2006: Vol. 314. no. 5805, pp. 1547 - 1548). (Subscription required.)

Excerpts:

The idea that the United States dominates cutting edge science and technology is challenged by the decline in the U.S. share of patents and the growth of corporate spending on research and development (R&D) in emerging countries like China and India. Because scientific discovery is critical to economic growth, these trends have sparked concerns as to what is driving companies to conduct R&D in these countries and the implications for future competitiveness, particularly given problems with the U.S. patent system and improving protection of intellectual property (IP) in emerging economies. Similar concerns pervade European innovation policy initiatives. The popular press has fueled these concerns with reports of R&D moving to emerging countries in search of low costs.........

Here we focus on the type of R&D conducted in different countries and argue that appropriate policies in the face of globalization should focus not only on the factors affecting location but also on the type of R&D conducted.........

Our regression analysis showed that, although quality of R&D personnel affects location decisions, it is not significantly related to the type of science. Cost was significantly related to the type of science with an increase in cost decreasing the ratio of new to familiar science. Growth potential and supporting sales were expected to be more important for familiar than new science, because R&D in those cases is likely to be product localization. An increase in market potential or a facility that supports sales is associated with a decreased ratio of new to familiar science. Results for the two IP factors were similar to those for quality of personnel, in that the IP factors were statistically important in location decisions, but were not significantly related to the ratio of new to familiar science........

The most striking result is that the factors related to universities (presence of university faculty with special expertise and ease of collaboration with universities) had the strongest impact on the type of science conducted.......

for developed economies to maintain an advantage for cutting-edge corporate research, the keys are maintaining excellence and accessibility of research universities. The new science at sites identified by our respondents is largely conducted in developed economies, and this is significantly related to university factors.