| Sumario: | In 1994, the federal government spent $71 billion for research and development, report David Moore, John Sturrock, and Philip Webre, principal analysts in the Congressional Budget Office in Washington, D.C. But measuring the impact of this and past investments on private-sector growth is difficult, if not impossible, the authors say. The uncertain effects of research investments have complicated the debate over the federal government's continuing role in sponsoring future research. “Evidence about the economic effects of federal research-and-development spending can be interpreted in myriad ways and thus offers only limited guidance,” the authors contend. Though there remains uncertainty regarding the economic impact of federal research, the authors maintain that a few things are clear. First, cuts in defense research likely will not harm private-sector productivity because defense-related research produces little in the way of private-sector spinoffs. Second, we should stress diversification in federal research spending until we have a firmer grasp of which federal research programs will likely spur the largest gains in the private sector. Third, public research investments should not be shielded from the forces of the market. Reprinted by permission of the publisher.
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