commissioned 11 industry case studies to determine the extent and sources of U.S. industrial resurgence from the mid-1980s to the latter half of the 1990s. Summarizing the findings regarding sectors as diverse as steel and semiconductors and food retailing and banking, David Mowery observed:

The papers use an array of different measures to measure performance, and not all of them are calibrated against the performance of non-U.S. firms in these industries. Nevertheless, the overall portrait is one of stronger performance, not least in the ability of firms to develop and deploy new products and processes…. As many authors point out, firms have strengthened their ability to exploit their own or externally sourced innovations more effectively, rather than focusing exclusively or even primarily on improvements in their research or development capabilities (National Research Council, 1999b, pp. 3-4).

Ideally, the collection of data on innovation should be guided by a solid theoretical understanding of the process and its impact. Such understanding of causes and effects, while being developed, is not very far advanced. It is possible, however, to elaborate a conceptual framework that encompasses direct indicators of innovation, what we believe to be the principal influences on innovation, and its effects on economic performance as a way of cataloging innovation indicators and data. The broad categories of innovation information include

  • influences on innovative activity, ranging from market conditions to investments in R&D and human resource capacity to the ways knowledge is communicated and used (inputs);

  • innovation characteristics as evidenced by new products, processes, and services introduced in the market (outputs); and

  • the effects of innovation on firms, workers, regions, and the economy as a whole (outcomes).

LIMITATIONS OF R&D DATA

The pattern, determinants, and effects of innovation involve variables that change over time, sometimes remarkably quickly and radically. At no time has that been more apparent than in recent years. At the workshop Paula Stephan, in introducing her commissioned paper, described several changes that are widely assumed to be occurring rapidly, to be substantial, and to have significant consequences for economic performance in the short term or in the longer run. These include (1) shifts in the industry and technology distribution of innovative activity, (2) shifts in the time horizon of innovative effort and investment, (3) changes in the



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