According to the National Science Foundation’s Science and Engineering Indicators 2010, the US while leading most areas of science and technology, has experienced a gradual erosion of its position. This is primarily because of the rapidly increasing capabilities among East Asian nations, such as China, and the fruition of the European Union’s efforts to boost its relative competitiveness in R&D, innovation and high-tech.

The data begins to tell a ‘worrisome’ story: Science and technology are no longer the province of developed nations

The report, which a top White House official called the ‘State of the Union for science, engineering, mathematics and technology,’ is required to be submitted to the president and Congress by Jan. 15 of every even numbered year, with the most previous report issued in 2008.

‘Not just about where we stand, it’s about where we are headed’

The report notes some important shifts that indicate that the US’s leading position is now facing serious challenges:

  • 2007 was the year China caught up to the U.S. in the number of researchers and doctoral degrees in natural sciences and engineering;
  • While the U.S. continued to be the largest R&D performing nation – representing one-third of total world investment – Asia has narrowed the gap, largely due to the sustained annual increases by China;
  • China is now the third-largest R&D performer in the world behind the U.S. and Japan and is moving ahead of Germany, France and the UK;
  • For several Asian economies, including South Korea, Taiwan, China and Singapore, increases in R&D investment have been accompanied by notable increases in the rate of growth in the number of researchers;
  • While the U.S. continues to lead the world in research output, China has become the second most prolific contributor to the world’s peer-reviewed science and engineering research articles, which is up from 14th place just 10 years earlier;
  • The U.S. economy had the highest concentration of knowledge and technology intensive (KTI) industries, such as biotech, among major economies; While those industries accounted for 38 percent of the U.S. gross national product (GDP) in 2007, China’s KTI industries created 23 percent of GDP – up from 21 percent in 1992;
  • Productivity growth has been higher in China and other Asian nations than in the developed economies;
  • The U.S., the EU and Japan – with similar shares of high-value patents – accounted for nearly 90 percent of the total world’s patents – Asia’s patent share increased from 1 percent in 1997 to 6 percent in 2006, with South Korea accounting for almost all of that growth;
  • The U.S. share of patent applications in 2008 declined to 51 percent, with gains for second- and third-ranked Japan and the EU;
  • The U.S. has a comparatively higher-than-average share of patents in aerospace and the four health areas of pharmaceuticals, biotechnology, medical equipment and medical electronics, with Asia relatively weaker in those technologies. However, Asia’s patent share has risen over the past decade with pharmaceuticals and biotechnology.


The report notes that overall spending on R&D in the U.S. was $398 billion in 2008 – up from $373 billion in 2007, or a growth rate of 6.7 percent. Importantly, the business sector accounting for 73 per cent of R&D performance and funding. The academic sector was the second-largest performer of U.S. R&D, with an estimated $51 billion in 2008, or just under 13 percent of the U.S. total.

But the federal government, the second-largest funder of U.S. R&D, provided an estimated $104 billion, or 26 percent, of the U.S. total in 2008. With the financial crisis this will definitely change.

The report confirms what has been argued in this blog for some time: namely, that science and technology activities are shifting toward Asian economies. What we are seeing is a relative decline in the US. But unlike other areas, R&D declines cannot be simply reversed. It is difficult to see how a decline in R&D capacity can be arrested other than a radical revamp which so far, is noticeable by its absence in the US and Europe.

2 thoughts on “R&D IN 2010: GOING EAST – ITS OFFICIAL

  1. As long as the federal government remains unable to differentiate between funding political activism, viz, “climate change” “research”, and real science and technology, we’re can expect our position in the world vis a bis R&D to continue to erode.

    1. I think that’s a very valid point, but the problem is far deeper than that. That is a symptom of a culture that has lost its belief in science and open-ended research; a culture that has taken the road of least resistance – short-term financial innovation vs long-term R&D in technology and science.

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