Books
Technology policy serves to stimulate both public and private innovation. During the Cold War, when government interests in technical superiority were paramount, public investments in research formed the cornerstone of technology policy. Few questioned the appropriateness of government support for applied or technological research for national security. Today, it is commercial innovation in service to the economy that increasingly drives technology policy. Does government still need to support the development of new technologies? If so, when, if ever, is it appropriate to fund research in private commercial firms? What kinds of technical research are deserving of a subsidy? In what institutional settings should such research be performed? How should government decide?
These questions lie at the heart of the debate in Congress over the Clinton administration''s science and technology initiatives. In the political debate, few quarrel with government support for basic science, but technology is often seen as the province of commercial firms. Thus arguments about appropriate government roles seek to draw distinctions between science and technology. The discussion becomes more tractable if, instead of debating the boundaries of "science and technology policy," we address the requirements for "research policy," to create technical knowledge, and "innovation policy," to cover the important subject of incentives for innovation.
This chapter advances the idea that one should distinguish between research— understood as an activity aimed at creating and informing scientific and technical choices for the use of many potential (and often unknown) beneficiaries— and narrow problem-solving, understood as the accomplishment of specific, obtainable objectives in the service of an identified beneficiary.
This distinction leads to a simple policy proposition: The decision on the appropriateness of federal funding of research should rest on the identification of the expected beneficiaries of the work, not the level of abstractness or the practicality of the work, or the motives of the investigator in undertaking it. When the public is the primary intended beneficiary, public investment is appropriate, providing the work is done under highly creative, intellectually competitive conditions and the results are widely diffused and appreciated.
In other cases, the intended beneficiaries should normally pay for the work, and the results may be kept proprietary. The idea that those who will primarily benefit should pay also applies to the government, when it intends to buy the products made possible by the research, and when national security may require that the results be kept secret. The criteria for public investment in research are not directly related to how "basic" or abstract the work is, nor to its likely utility, but rather to its net public value. However, this does not necessarily imply that publicly funded work must be placed in the public domain; sometimes assigning proprietary rights to the performer may be the most effective way of assuring both the production of value and its eventual diffusion to the public at large.
Research, in this definition, may create both new understanding of nature and new technical opportunities. Some of those opportunities may be immediately accessible. Others may not mature for decades. But in general both scientific research and technological research may be contribute to public value. Thus basic technology research is a natural companion of basic scientific research. Indeed the two are often interdependent and even indistinguishable. Like science, engineering and medical research also contribute to the public stock of knowledge and skill.
Technological as well as scientific research aimed at building national capability, creating new opportunities, and guiding technological decisions should motivate the government''s investment in research. When science itself is the driver to create new opportunities and new understanding, the research community should have the primary voice in setting goals and priorities. When, on the other hand, it is public needs that drive the research, the political process, informed by research, provides the funding and the overall goals. But in both cases, researchers need an environment that favors risk-taking and allows them considerable latitude in setting research strategies.
This public investment in intellectual infrastructure creates knowledge, skills, and institutions. It responds to the intellectual challenges both of unraveling the mysteries of nature and of imagining the uses for the knowledge gained. Scientists, engineers, physicians, and others participate in it. Universities, government-funded laboratories, and firms all contribute to this kind of research, which we call "basic technological research," a companion to the more widely understood and accepted "basic scientific research" to which the U.S. government has contributed so effectively over the years. (I discuss just what we mean by "basic technological research" after addressing some reasons for caution in such public investments.)
This is a better way of thinking about the world of research in which the U.S. government plays such an important role. Americans believe in the importance of research to keep the nation smart, strong, and capable, and to provide the right kinds of incentives for a competitive, private economy. A research policy that creates new understanding of technology as well as new science is a key to realizing that goal and resolving some of the political conflicts over how public dollars should be spent.
This chapter begins by seeking terminology to discuss research policy that better reflects the criteria that should be used in distinguishing public from private responsibilities for investment. It then addresses the market failures that call for government incentives, and the government failures than may frustrate otherwise justified public expenditures. Next I discuss the selection of publicly-funded research performers and the conditions under which basic scientific and technological research should be performed. I conclude that the nature of research opportunities and needs will determine the relative influence the political process and the research community should have in setting the levels and priorities for public investments in research.
(1) What is Research?
Many people lump together all kinds of technical activity into "research and development." The shorthand "R&D" is often taken as if it were one word, despite the fact that its two components are very different kinds of activities. Scientific and technological research are intensely intellectual and creative activities with uncertain outcomes and risks, performed in laboratories where the researchers have a lot of freedom to explore and learn. Development, by contrast, is a highly focused activity aimed at producing a design or a process that can be realized in a specified time using specifically allocated resources. It is typically tightly managed to minimize risks and to achieve neither more nor less than the specified objective.
When government officials gather statistics on different kinds of technical activities in order to make policy on budgeting and managing government R&D, distinctions as to the purpose and nature of the work are needed and programs are divided into "basic research," "applied research," and "development." At one end of the spectrum, basic research is most often assumed to refer to scientific investigations, most likely in a university or independent laboratory; at the other end, development is assumed to be an activity of engineers, most often in an industrial setting.
Any of these three categories of technical work may be aimed at building society''s knowledge and skill base, or creating products for the government''s use, or exploring new product or process opportunities for a commercial market. But basic research depends primarily on public funding, while development is almost always driven by markets, private or public. Applied research is an ambiguous category, usually defined as research of identifiable utility, placed somewhere in the middle of the intellectual spectrum between speculative theories of science at one end and predictable application of well-verified knowledge on the other. Since most of the confusion about the government''s role in research funding concerns this gray area of applied research, this category is not very useful for policy makers. To call a research program "applied" is not enough to tell us whether it is appropriate for government funding. Thus we must find a set of categories for technical activities that better lend themselves to the discussion of the government''s role. This is the task of the next section.
(2) Defining research
Scientific research embraces inquiry into the workings of nature without regard to the motivation of the scientist or the investor in the scientist''s work. Within this conception of research lies all of what is commonly called "basic" or "fundamental" research, plus much of what some people choose to call "applied" (because it is likely to be useful). "Research" does not normally encompass development, testing, design, or product simulation. Research is an activity for which the doctorate is often the appropriate training. It is carried out primarily in laboratories managed for the purpose of conducting scientific research and is funded by agencies or bureaus experienced at research investment and management.
We all know that some basic research is highly abstract and speculative, far from any kind of practical application or economic value. No one is going to commercialize theories about black holes any time soon. But must basic research be useless to qualify as "basic"? Surely that would be an absurdity. Basic research is best thought of as research to create knowledge that expands human opportunities and understanding and informs human choices. It may lead to a new scientific observation that raises new questions. If black holes are found at the centers of galaxies, including our own, what does that tell us about the ultimate fate of our own solar system? Surely that is an important question, but only experts will be able to see how the work might, some day, inform more "practical" science.
Research may also lead to understanding that suggests a technological possibility or informs a choice among alternative technologies. What does science tell us about the chemical reactions in the earth''s stratosphere from which we might predict whether a fleet of supersonic transports might deplete the protective ozone layer? President Nixon asked his science advisor, Dr. E.E David, this question when considering whether to ask the Senate to reconsider its negative vote (by a margin of one) on the Supersonic Transport (SST). The president''s decision not to try to gain that extra vote turned, in part, on quite basic questions of free-radical chemistry. It does not take decades for basic research to have value when it informs technological choices, as in this case.
Research might lead to the discovery of a new material, the understanding of a new process, or the creation of an idea leading to a new kind of instrument. If materials can be made that are offer no electrical resistance at room temperature (i.e., are high-temperature superconductors), could world demands for energy be greatly reduced in the future? What other applications for electric current that flows without resistance might we imagine? Such basic research may lead to scientific or technological progress, or both.
Most often, scientific and technological research go hand in hand. A scientist might invent a new kind of scientific instrument to explore a poorly understood area of natural phenomena. Her colleagues build similar instruments in their laboratories. One of them, perhaps a bit more entrepreneurial than her fellows, decides to make a more reliable version of the instrument, manufacture it, and sell it to other scientists in the field. Soon this instrument is in widespread use for analysis, and someone, perhaps an engineer, realizes the instrument can be used in reverse to control a process rather than measure it. Thus an instrument designed for analysis becomes a tool for synthesis.
Consider, for example, the electron microscope. It was invented to enable scientists to see very small things. It is now used in reverse to make very small things, not only in the laboratory but in electronics factories. In this example, science created the need for the instrument. The resulting instrument business enabled more rapid scientific progress. Soon the electron microscope instrument was used in reverse as an electron-beam lithography tool for making tiny structures on computer chips. The computers using these tiny chips are faster and provide a more powerful tool for the advance of other fields of science. In this example, it is very difficult to sort out whether science was driving the technology or technology was driving science: both were happening concurrently.
(2) Basic technological research
The justification for federal support of research that is investigator-initiated (that is, not driven by sponsor-defined needs or applications) is not restricted to science. Harvey Brooks points out that "pure technology" may be as appropriate for public investments as "pure science." There are many examples of successful public investments in technology that preceded identification of market-supported applications. Brooks cites as examples the development by the Atomic Energy Commission of radio-isotopes and stable-isotope tracers— now used for both diagnosis and treatment of disease and for fundamental biological research— well before the medical and biology communities had learned how to use them or defined a need and a market. This investment enabled much of the molecular biology revolution that followed.
The public investment in computer networking that led to the Internet is a contemporary example. (See Chapter 13 by Brian Kahin.) When Robert Kahn first developed the Internet Protocol for computer networking at the Defense Research Projects Agency, no one imagined that within a few years, billions of dollars would be invested in information services offered through the World Wide Web.
Good examples of basic technological research can be found in academic engineering research, such as might be funded in the National Science Foundation (NSF) Engineering Research Centers, or in much of the Department of Defense (DoD) budget category called "exploratory development," such as the quest for efficient operating systems for massively parallel computers. Other examples are the fusion energy program in the Department of Energy (DOE) or the search for practical materials that exhibit room temperature superconductivity. Within the civilian technology programs, such as the Advanced Technology Program (ATP) of the National Institute of Standards and Technology (NIST), one also finds examples of high-risk science-based industrial research, such the search for solid state lasers that radiate in the ultra-violet, which would permit greater information storage capacity on compact-disk-based media.
The phrase "basic technological research" is meant to direct our attention to work that creates new capabilities as well as new understanding, and is not simply focused on narrow problem-solving or product development. Thus "basic technological research" takes its place beside "basic scientific research," forming two arms of intellectual investment into a vital capability of human society. The appropriate public policies for investment in them are not based on attempts to distinguish these activities by their intellectual content, which is fortunate since they are highly interdependent and overlapping. Rather, policies for resource allocation should derive from a weighing of opportunities and needs, and from provisions for diffusion and use of the information produced. The right public policy for supporting research should not require rigid distinctions to be made between basic scientific and basic technological research.
(2) Distinguishing research from narrow problem-solving
The criteria for public funding of basic technological research are similar to those for basic science. Technological and scientific research should be understood to be complementary and should receive bipartisan support for the same reasons. Yet politicians are typically more comfortable with advocating funding for scientific rather than technological research, perhaps because the implicit utility of technological research may suggest that there is— or might be— an identifiable beneficiary who should be footing the bill. If there were such a beneficiary, then the work, they might say, should be called "applied research" and the government should keep hands off.
The culprit, as noted above, is the ambiguous phrase "applied research." Much of the basic and exploratory research funded by the Departments of Defense and Energy and by the National Aeronautics and Space Administration (NASA) is neither specific to government procurement nor commercially proprietary; rather it is devoted to enhancing the U.S. capability to innovate broadly. But in government statistics such work may be labeled "applied research" if the research is said to be working toward a well-defined, utilitarian objective. What matters for public policy, however, is the objective of the investor, and its expectations of return from the investment. The fact that work may have a useful application does not tell us whether the government should fund it. The opposite syllogism, surely, we must reject; government should not decline to fund research simply because it might have a practical application.
The usual distinctions between "basic research," "applied research," and "development," used for many years in the formal government statistics kept by the National Science Foundation are, unfortunately, insufficient for discussions of policy for government investment in technical activities. Indeed, definitions are the source of much of the confusion over the appropriate role for government in the national scientific and technical enterprise.
One cannot distinguish in any meaningful way "basic" from "applied research" by observing what a scientist is doing. A scientist engaged in testing a steel pipe for leaks— a rather routine "applied" task— may insist his work is "basic," because his leak-free pipe might allow a measurement of the second-order Doppler shift predicted by relativity theory. Another scientist working on extensions to the quantum theory of collisions of electrons with atoms— a highly sophisticated and apparently abstract activity— may say she is engaged in "applied research," because the use of her theory to predict collision cross sections might be of practical assistance to fusion energy engineering.
"Applied research" should not be used to mean "purposeful and demonstrably useful basic research," and one should be wary of the use of the term in government statistics. In corporate research laboratories, such as the T.J. Watson Research Laboratories of IBM, all of the work is referred to simply as "research." There is no need to attempt a distinction between "basic" and "applied" research. All of the company''s research investments are motivated by corporate interests. All of the research has a purpose. All of it is conducted under highly creative conditions. None of it is so "pure" that there are no expectations of value from the research investment.
We should reserve the words "applied research" for those narrowly defined tasks in which limited time and resources are devoted to a specific problem for an identified user who gets all the benefit and should pay all the costs. To make this view of applied research clear in this discussion, I use the words "problem-solving research" instead.
Narrow problem-solving and development are activities initiated by someone who wishes to apply research methods purposefully to exploit an identified opportunity or solve a problem. They involve the application of technical resources to achieve an identified goal for a specified beneficiary, usually the investor in the work. It is a reasonable assumption that those who engage in such activities expect to benefit from them, and to benefit by a sufficient margin over the cost to accommodate the technical risk that is ever-present in research. The investor in problem-solving may be a government agency, but is more likely to be a private firm. In most cases that firm would be expected to be able to appropriate sufficient benefits to need no government subsidy to take those risks.
Public investment in the creation of new technology (technological development, whether by research or as a product of problem-solving) is a critical link between societal goals and the scientific research that is pursued by virtue of society''s commitment to those goals. Thus the desire for technology is an important— perhaps the most important— source of demand for science. The way scientific research is used to further technological goals may profoundly affect policies for allocating funds to science and determining the institutional settings in which scientific research is performed. In fact, the way innovations are brought about in industry, and the role of science in support of innovation and productivity growth, have both substantially changed. Thus, any discussion of technology policy must address research policy as well.
(2) The Search for Useful Language in the Public Debate
These questions of definition may seem highly academic. But they lie at the heart of public policy debates about technology policy, not only because science is both a source and a product of technology, but because the boundaries between research that leads to new technical knowledge and research that leads to scientific understanding are obscure and often misunderstood. Before one can create a policy for public investment in research, one must know more about the goals of the work, who its intended beneficiaries might be, and how these results might reach those who can use them beneficially. These are the attributes that should determine the role of government in funding technical work, not the narrow distinctions between science and technology.
As Neal Lane, director of the National Science Foundation (NSF) said in testimony to Congress:
To my mind, the question is not, where the dividing lines are between science and technology, or between basic and applied research, but rather how do we take better advantage of the interrelationships in order for the nation to reap the full benefits of its integrated investment in science and technology?
Lane quoted Donald E. Stokes:
The annals of research so often record scientific advances simultaneously driven by the quest for both understanding and use, that we are increasingly led to ask how it came to be so widely believed that these goals are inevitably in tension and that the categories of basic and applied science are radically separated.
Conservatives in Congress are searching for the right language through which to express their support for what they understand to be basic research, while making clear their objections to public funding of private goods. Congressman F. James Sensenbrenner, chairman of the House Committee on Science, made this distinction in explaining the Committee''s report:
Federal R&D should focus on essential programs that are long term, high risk, non-commercial, cutting edge, well-managed and have great potential for scientific discovery. Funding for programs that do not meet this standard should be eliminated or decreased to enable new initiatives.
To make clear what the Committee majority does not like, Sensenbrenner added:
Beyond the demonstration of technical feasibility, activities associated with evolutionary advances or incremental improvements to a product or a process, or the marketing or commercialization of a product or process, should be left to the private sector.
Representative Sensenbrenner''s views as expressed here probably do not conflict with the consensus in both the technical and the political communities. But it should not require six qualifying adjectives to describe the research the government should support, and it complicates the issue to try to restrict approval to scientific discovery. Sensenbrenner''s apparent restriction to scientific discovery implies that he would not be equally enthusiastic about technological discovery, even if it were "long term, high risk, non-commercial, cutting edge, [and] well-managed." A simpler way to distinguish appropriate opportunities for public funding from those better left to the private sector is to focus on the intended beneficiaries of the research.
(2) Identifying the Intended Beneficiaries of Publicly Funded Research
The rule is simple: let the primary intended beneficiary pay for the research. The careful circumscriptions of the precise kinds of research that government should and should not support, described above, are a way of implementing this principle by describing what kind of research the speaker believes best serves the public interest.
Research to serve a firm''s commercial interest will be recouped in profits from that commercialization; no government funds should be employed. The company pays. When the government makes the market (as in defense procurement), the government pays. When the government invests in the nation''s skills and knowledge, going far beyond the private investments justified by market rewards, the people benefit, and the people''s government pays. And, where firms under-invest in relation to a defined public interest, such as reducing environmental risk or accelerating medical progress, government and the private sector may share the costs. As discussed in the final chapter of this book (Chapter 18 by Lewis Branscomb and James Keller), the cost-sharing ratio should reflect the best understanding of the likely distribution of public and private benefits.
We have argued that public funds should be invested when the public interest outweighs private gain, and that basic technological research can contribute as much as basic science to national capability and need. But that leaves a number of questions still to be answered about the nation''s research policy: What provisions should be made for insuring that research outcomes reach intended beneficiaries? Who should do the research? How much autonomy should be accorded investigators in universities, national laboratories, or independent laboratories in order to ensure a creative environment? Who sets the priorities for different research programs? What motivations should drive allocation of resources to different research objectives? These will be subject of the remainder of the chapter.
(1) Conditions for gaining value from research
If research, whether in the more abstract science disciplines or in the more "practical" fields of science and engineering, is to provide public value, it must be conducted under conditions that ensure a high level of creativity, accountability to sponsors of the work, and effective access by potential users.
(2) A creative environment for research
Research is most fruitful when pursued by highly trained people who are accorded freedom to decide what are the most important scientific questions and how to pursue them. When engaged in research, scientists need latitude to set research strategies and need the feedback that comes from exposure of their work to the praise and criticism of their peers. Development and narrow, task-oriented problem-solving also benefit from a creative environment, but the explicit nature of the goals and the time pressure to reach them substantially reduces the freedom to shift directions in response to unexpected opportunities for discovery. Thus the circumstances under which the work is performed help to distinguish "basic scientific and technological research" from "problem-solving," "testing," and "development."
Researchers insist that the need for academic autonomy, balanced with accountability, is indeed legitimate when the work is research and the goal is to maximize learning. A government agency may lay out its view of the areas of research it believes most fruitful and in which it is prepared to invest. A policy of responding to unsolicited proposals from scientists with good ideas in response to the agency''s challenge creates a wealth of valuable research opportunities. Selecting from among these ideas by submitting them to the critical review of other scientists knowledgeable in the same field and by technically expert users who can assess the likely value of the work sustains the quality of the work, its likely value to society, and the fairness of the allocation of government funds. The peer review process also expands awareness of the work and promotes its subsequent diffusion. The primary diffusion mechanisms are horizontal, to others in the same or nearby fields. The employment of recent graduates trained in research, the secondary literature, and various conferences and study groups are relied upon to diffuse the work to practitioners such as engineers, clinicians, and scientists in "downstream" disciplines.
This system of selection of projects and of performers is strongly defended by the scientific community, and for good reasons. One of these arguments seeks to tie the need for autonomy to the unpredictable nature of science in pursuit of understanding and new possibilities. Scientists fear that Congressional pressure for immediately useful results from publicly supported research may lead to a loss of the conditions necessary for creative work. If research is treated like problem-solving or like development, they fear, micromanagement and unrealistic expectations for quick results cannot be far behind. Three examples illustrate the basis for this fear.
In the early 1970s the government tried to respond to political concerns that government research contributed too little to social well-being by creating a program at NSF called Research Applied to National Needs (RANN). This program addressed concerns such as fire research, and both social and natural scientists were expected to participate. As the name implies, this was NSF''s attempt to induce scientists accustomed to opportunity-based research to redirect their attention to what the government viewed as need-driven. In point of fact, some the research conducted under RANN received generally high marks from independent evaluators. However, scientists remained concerned that NSF should be undertaking need-driven research at all. This was a legitimate concern. It is far from obvious that NSF is best equipped to set such priorities, but no other agency seemed to be available to do so.
A second example is the "war on cancer," which threatened to divert biomedical research from a fundamental attack on molecular biology and immunology in the quest for a "quick fix" solution to cancer (a fear that only an extremely generous Congress and tenacious National Institutes of Health (NIH) management averted). Similar concerns emerged when AIDS research was given a special priority by the Congress.
The third example arose in 1992 when Walter Massey, then director of the NSF, requested that the National Science Board (NSB) establish a "Blue Ribbon Commission on the Future of NSF" to examine whether NSF should attempt to contribute to the government''s effort to enhance the competitiveness of American industry. Pessimists jumped to the conclusion that such a mission priority would lead to the displacement of individual-investigator, opportunity-driven research by political perceptions of industrial need. A second fear was that this preference for need-driven research (in this case responding to industrial needs) at NSF might result in government officials selecting investigators without expert peer review, and evaluating both outputs and outcomes of the research. The Commission concluded, however, that scientific autonomy— based on peer review evaluation of competing, unsolicited proposals— can and should be preserved, even as NSF seeks to balance both intrinsic and extrinsic values by appropriate priority setting for its fields and areas of research.
Neal Lane, director of the NSF, is careful to avoid this trap. In his 1995 testimony, he said:
NSF support of research focuses almost exclusively on answers to fundamental questions that defy our ability to predict the outcomes. Still, it is important to recognize that taxpayer-funded fundamental research can and should have a conscious relationship to the nation''s priorities and societal needs. This does not mean a narrowly directed agenda of targeted research, but rather, a program of fundamental science and engineering [research] that clearly is in and for the national interest, in its most comprehensive interpretation.
In all of these cases it was research autonomy that was at stake. It was not an argument over the importance of the social goals to which research contributes so much. The concern of the researchers had been elevated by the tendency of politicians to imply that research of high public value should be managed differently from more conceptual or theoretical work. When the work might be of economic value, the concern escalates to the fear that politicians will conclude that such useful work could and should also be paid for from non-governmental sources. Where public goals are driving research investments, the agencies do feel accountable for the ultimate delivery of public benefits, but they must not let this lead them to micromanage the creative research on which they are depending.
(2) Ensuring user access to research results
The linkages between outputs from research and outcomes for society are often ill-defined (see Chapter 3 by Adam Jaffe on metrics) and operate outside the province of government control. This does not free government from the obligation to understand the processes that create public value from its research investments. When government is investing in research to build national capability, the extent of returns to public value is strongly influenced by the ease with which users can access the results and put them to effective use. Research environments that foster creativity also offer effective mechanisms of information and skill diffusion.
When basic technological research is performed in universities, students, project referees, academic visitors, and collaborating companies all contribute to the diffusion of new knowledge, adding greatly to the effectiveness of formal publication. The government provides special institutional mechanisms to foster information diffusion; among these are Cooperative Research and Development Agreements (CRADAs; see Chapter 9 by David Guston); government support for University-Industry Research Centers; and funding of post-doctoral research fellowships. When basic technology research is funded in industry, the use of consortia of firms, perhaps in collaboration with universities and state technology programs, provides an effective diffusion mechanism (see Chapter 18). Thus even where the most immediate public benefit from research might be the creation of jobs resulting from commercialization of the ideas, the employment of consortia is a way to increase the ratio of public to private benefits.
(2) When should private firms be funded to perform research?
The selection of performers of research should be based on competence, taking into account the productivity of the work, the skills and experience that will be developed, and the effectiveness of the diffusion of research outputs. If one is persuaded that government should fund technological as well as scientific research, the next question is, When, if ever, should private firms be funded to perform the work? Here policy-makers confront a dilemma. If one is to avoid politically sensitive choices among competing firms, the safe way out is to fund research only in government laboratories, universities, and other not-for-profit institutions. But avoiding this Scylla of choice delivers one to the Charybdis of needlessly isolating the research from its ultimate users in private industry. If new research is to be quickly and widely accessible, it should be conducted in industry laboratories or in institutions with effective links to industry. The most effective mechanism to foster commercialization of new ideas is to have the ideas arise inside industry itself. For these reasons we conclude it would be a serious mistake to categorically exclude industrial organizations from eligibility to perform basic scientific and technological research for the government. However, we support the NSF policy of giving its priority to universities, while the research programs of the "mission" agencies should cover the broader spectrum of research institutions, both public and private.
(1) Allocating resources to publicly funded research
The growing budget pressure on public funding of scientific research exacerbates tensions that have accompanied the public funding of scientific research for a long time. Going all the way back to the writings of Francis Bacon, policy makers have struggled with the balance between resource allocation strategies supportive of scientific autonomy and those derived from identified public goals and values. This was the subject of major academic debates in the 1920s, with the protagonists represented by J.D. Bernal and Michael Polyani. As Harvey Brooks has observed, research motivations fall generally into two categories: opportunity-driven research— pursuing the visions of scientists, and need-driven research— responding to the needs of society. How should these two sources of motivation for the government research investor be balanced? To what extent can— or should— scientific research investments be based on government constructed plans, and to what extent should public investors rely on the intrinsic values of scientific research to ensure outcomes of maximum benefit to society?
(2) Research Motivation: The Clinton-Gore Science Policy
In August of 1994 the Clinton-Gore administration issued its long-awaited "science policy," a companion to the technology policy declaration that appeared almost instantly after the 1993 inauguration. The science policy was issued in a well-illustrated paper entitled Science in the National Interest (referred to as SNI). SNI makes the case that there are two valid criteria that should be invoked in allocating resources for science, one involving centralized, goal-driven decisions, the other aimed at creating a strong scientific infrastructure on which all goal-oriented research can draw. Investments in this infrastructure, SNI says, should be based on the intrinsic values of science, reflecting the opportunities for conceptual progress identified by scientists.
SNI drives home the importance of opportunism in basic science. It says:
It has seldom proved possible to anticipate which areas of science will bring forward surprising and important breakthroughs at any given time. Therefore U.S. scientists must be among those working at the leading edge in all major fields in order for us to retain and improve our competitive position in the long term.… [N]ature yields her most precious secrets in surprising ways, to those who are well prepared and persistent, and with a schedule not often amenable to detailed planning. Thus although we can and must do more to identify and coordinate research thrusts aimed at strategic goals, we must not limit our future by restricting the range of our inquiry. Vibrant scientific disciplines are best guaranteed by the initiatives of talented investigators and in turn provide the strongest and most enduring foundation for science in the national interest.
This very sensible vision correctly associates creation of a strong intellectual base for society''s future use (policy for science) with the need to ensure that science serves the goals to which it can make decisive contributions (science for policy). It does not spell out, however, how the two criteria for choice— intrinsic scientific merit and extrinsic social utility— will be placed in balance. How much of each do we need, and who decides?
(2) Need-driven research
The source of priority evaluation for need-driven exploratory research may be quite different from that for opportunity-oriented science, even when the motivations of the researchers are the same. Whereas opportunity-oriented research is proposed and evaluated in a competitive horizontal environment (peer review being the dominant mechanism), need-driven research derives its priority from vertical relationships. The need is typically expressed in terms of some capability to be realized through a technology, which in turn may derive its conceptual structure and future evolution from new science. The level of priority derives from the initial goal, but, as a practical matter, is derivative of the congressionally-authorized investment in the technology to which the science contributes. Thus, for example, the importance of new sources of energy and the likelihood that fusion can provide a welcome solution should determine the scale of investment in fusion. The technical agenda for fusion research will determine what fields of science are relevant, and will suggest where research might offer new options that can increase the likelihood of success.
DOE''s criteria for deciding what kinds of plasma physics research to pursue are not the same as might be assigned to an opportunity-driven NSF project in, let us say, the plasma phenomena in formation of stars. Pertinence to fusion technology is clearly relevant for the DOE; not all forms of serendipity are equally welcome. Thus, equally competent investigators working on the same problem will find their work evaluated differently by DOE and by NSF— and, indeed, quite differently again if funded by a private commercial firm.
The fact that science is almost always embedded in a fabric of other technical activities— both in space and in time— means that allocation decisions also follow those chains of consequence and pertinence. A given research project in plasma physics might find itself justified by a commercial and public interest in new energy sources, by an academic curiosity about how stars form, or by the government''s concern about the effects of atmospheric re-entry on space craft or military missiles. Which of these justifications dominates the public investment decision does say a lot about the amount of money to be invested and how the overall program of research is directed. But for this research to reveal the richness of potential options, it must be carried out in much the same style as one would pursue opportunity-oriented science. Thus the scientists performing it will describe their work as basic research, if their work environment is similar to that expected for opportunity-oriented science.
If all exploratory research, whether need-driven or opportunity driven, requires similar staffing skills and research environments, and if the sources of judgment about resource allocation are distinct but understood for each, why is it necessary to ask whether the research activities look more "scientific" or more "technological"? It is the motive of the investor that matters, not that of the investigator. The answer is that there remains one other dimension of policy to be addressed. How does government decide how to allocate its resources among the different kinds of scientific research goals?
One answer to that question we have already given: government should sponsor a level of need-driven exploratory research appropriate to support the missions that created the need. It is time-honored U.S. policy that every federal agency should invest in basic scientific research in proportion to the agency''s dependence on the skills and knowledge of the relevant scientific field. This policy has provided a level of diversity of sources and perspectives in science that have greatly enriched the U.S. scientific enterprise.
(2) Opportunity-driven research
But what about opportunity-driven research? How far does the scope of our conception of research driven by intrinsic scientific interest take us toward utility? The justification for government support of "basic research" may be at a maximum when the likelihood that basic concepts may be altered or extended is a maximum: when the "laws" of science are created or repealed. But must its level of applicability to more practical matters also be at a minimum to satisfy the requirements for public support?
Is high energy physics "better" science than materials science and engineering? What about a project to characterize the properties of a new material, or research on a new idea for a scientific instrument, or measurements of the thermodynamic properties of a new polymer? This kind of research may be both opportunity-driven and need-driven. It may be very interesting science while also utilitarian. It usually requires the kinds of people and environments that are characteristic of "basic" research or exploratory science.
This is the kind of research the National Institute for Standards and Technology and its predecessor agency, the National Bureau of Standards, have done for decades to support the productivity growth of U.S. industry. Such research is deserving of public support for the same reason that other areas of need-driven research are supported, except that in this case the customers for the results are widely dispersed, like the customers for other "basic" research.
Such "basic and useful" work falls into the category that has been called "infrastructural," and has a counterpart in "infrastructural technology." Unhappily for clean policy distinctions, but happily for the health of science, there is no discontinuity between intrinsic and extrinsic values in science. One cannot sort out the fields of science on a line, with the most prestigious at one end and the most utilitarian at the other. Quite often the best scientists working in a utilitarian field make a remarkable scientific discovery. For example, work on the electrical properties of materials at low temperature, driven by the search for new electronics technologies for the computer industry, led to the discovery of high temperature superconductivity, one of the most startling events in physics in this century. It revitalized a field of physics that had become largely moribund because it had been prematurely assigned the "useful but not so interesting" label. Furthermore the most sophisticated science occasionally creates byproducts that are quite utilitarian; witness the evolution of the storage ring of high-energy physics into the x-ray lithography tool of the integrated circuit manufacturer.
How should decisions about investment in such work be made? Figure 5-1 suggests that research draws on both understanding and technology, and contributes both to understanding and to improved technology. Both outcomes are appropriate motivations for public investment in research. There must be two elements of motivation in research: the investor must be motivated to take financial risks, and the investigator must be motivate to take professional risks. These risks are generally higher in opportunity-driven research, but so too may be the rewards, both to the research and to society. A reasonable public policy involves a balance of risk and reward.
Figure 5-1: The relationship among the goals of public research investments and the nature of the technical endeavor
Source: The diagram is adapted from one given by Stokes as Pasteur''s Quadrant.
(1) Conclusions and Recommendations
This leads us to our conclusions: First, the correct criterion for the appropriateness of federal investments in research is the expectation that the primary beneficiary will be the public, that is, the national interest. Where government makes the market (either through procurement, or in some cases through regulation), it may be appropriate for government to fund not only research but development as well, and to manage the projects to specific objectives, costs, and schedules. Where government is investing in the knowledge base, whether in response to learning and discovery opportunities or in response to identified public needs, government should invest in research performed under conditions appropriate for high productivity and creativity.
Second, research is not "pure" or "basic" because no uses for the results are expected. Instead, it is research because the knowledge gained is to a significant degree unpredictable and serendipitous and is expected to be widely diffused and therefore broadly beneficial. The primary distinction between research and narrow problem-solving is not found in the level of intellectual sophistication or in the level of utility of the work, but rather in the prior identification of the beneficiaries of the work.
Third, basic technology research is intimately related to basic scientific research and should receive resources and be assigned to performers using similar criteria to those used for basic science. Creative conditions of work are just as necessary for creating new technologies as for new science.
Fourth, resource allocation decisions for need-driven research must be made by the funding agencies based on their legislative mandates. Agencies authorized to address specific problem areas (such as energy, health, space, or defense) should further the nation''s capabilities to address those problems by funding basic scientific and technological research in the relevant technical areas. The level of research investment should reflect the priority accorded to the mission objective by the political process and the opportunity that research offers for enabling mission success.
Fifth, resource allocation for opportunity-driven research should be based on professional assessment of the likelihood that success will create new and important intellectual as well as practical opportunities. The magnitude of investment should be proportionate to the need for research training in the universities and to the demand for research progress reflected in technological development commitments, both public and private.
Finally, the criteria for investing in basic technology research, like that for science, must be originality, intellectual rigor, and practical value. Like science, if technology research is to be creative, it must not be micromanaged by government.
If the consensus behind the federal support of basic scientific research is extended to basic technological research, and it is understood that the federal government subsidizes development of products and services only when these outputs are required to fulfill federal missions such as defense, health, and environment, then it should be relatively easy to come to a general understanding about federal support for basic research that is relevant to commercial as well as public purposes.
What is the practical effect of these conclusions? Before 1980 there were frequent complaints from the engineering professions that NSF treated engineering research (or technological research) as a lower-priority activity than the "hard" sciences. This debate even found expression in Congressman George Brown''s threat (as chairman of the House Science and Technology Committee) to create a National Technology Foundation, which would have competed with NSF for funds and attention. This proposal was dropped and instead the Congress revised the NSF enabling statute to add the words "and engineering" everywhere the word "science" appeared. The National Science Board removed the words "applied research" from the Engineering and Applied Research Division, thus making it clear that NSF does not engage in narrow problem-solving research but does regard engineering research as parallel to chemistry and oceanography, and not simply a branch of applied research. Today, it is fair to say that the Science Board''s policy is to view research in its broad sweep, embracing fields as different as mathematics, chemical engineering, and econometrics, without intended intellectual prejudice.
What is required now is a more robust process for justifying budgets and allocating resources over the full range of opportunity-driven and need-driven criteria for investment. With this in mind, the NSB should consider reinstituting, perhaps in improved form, the "COSEPUP" studies chartered by the Council of the National Academy of Sciences and the Council of the Academy of Engineering and funded by the NSF. Performed by teams of research scientists within each discipline, they were intended to map out the most fruitful lines of research in the next five to ten years and to inform the research investments of federal agencies. These studies typically covered the full range of criteria for investment, and the experts themselves set priorities. Two new features might be valuable. First, a stronger effort to engage the field sciences, engineering, and clinical communities in identifying need-driven priorities that might pay off in better balance in the overall NSF program. Second, selected interdisciplinary subjects should be systematically studied. Such studies might also explore the usefulness of technology roadmaps, as discussed in Chapter 18.
It is our hope that this discussion will prove most useful to the committees of the Congress that have struggled so long and hard to communicate their policy objectives to the public and to the agencies and— most important— to a nervous and sometimes defensive science and engineering community. If Congress can get comfortable with the support of research, without trying to deconstruct its intellectual content, while fulfilling the full Congressional responsibility to address the motives of its investments in research for the nation''s future, most of the rancor can be eliminated and a bi-partisan research policy can be realized.
What the nation needs is not a science policy and a companion technology policy, but rather a research policy to support a research-based innovation policy.
