Introduction

The idea that the United States dominates cutting-edge science and technology is under attack as a result of a declining U.S. share of patents and scientific awards and media reports of increasing corporate reliance on offshore research and development (R&D). A search of the archives of the Wall Street Journal and the New York Times over the period 2002–2005 showed 61 articles focused on the offshoring of R&D. Thirty-eight of these articles mentioned costs as a factor in the decision to offshore R&D, and 29 noted the quality of R&D personnel as a factor. No other factors were mentioned as prominently as costs and the quality of R&D personnel. Only 10 articles noted the role of output markets, and only 4 mentioned intellectual property regimes. Three discussed the role of universities in the process.

R&D globalization has also taken center stage in policy circles as questions are raised as to how the United States and Western Europe can provide environments conducive to innovation.1 Over a concern that policy discussions be informed by data, rather than case studies or anecdote, the

1

See, for example, the Council on Competitiveness (2004), Innovate America: Thriving in a World of Challenges and Change (Washington, DC), and the Committee on Science, Engineering, and Public Policy (2006), Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future (Washington, DC: The National Academies Press).



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Here or There? A Survey of Factors in Multinational R&D Location Introduction The idea that the United States dominates cutting-edge science and technology is under attack as a result of a declining U.S. share of patents and scientific awards and media reports of increasing corporate reliance on offshore research and development (R&D). A search of the archives of the Wall Street Journal and the New York Times over the period 2002–2005 showed 61 articles focused on the offshoring of R&D. Thirty-eight of these articles mentioned costs as a factor in the decision to offshore R&D, and 29 noted the quality of R&D personnel as a factor. No other factors were mentioned as prominently as costs and the quality of R&D personnel. Only 10 articles noted the role of output markets, and only 4 mentioned intellectual property regimes. Three discussed the role of universities in the process. R&D globalization has also taken center stage in policy circles as questions are raised as to how the United States and Western Europe can provide environments conducive to innovation.1 Over a concern that policy discussions be informed by data, rather than case studies or anecdote, the 1 See, for example, the Council on Competitiveness (2004), Innovate America: Thriving in a World of Challenges and Change (Washington, DC), and the Committee on Science, Engineering, and Public Policy (2006), Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future (Washington, DC: The National Academies Press).

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Here or There? A Survey of Factors in Multinational R&D Location Government-University-Industry Research Roundtable (GUIRR) of the National Academies asked the authors to undertake a survey of the factors behind R&D site location, with particular attention paid to the decision to locate in the home country versus other countries. The survey instrument was developed after extensive consultation with representatives of GUIRR, the Industrial Research Institute (IRI), the European Industrial Research Management Association (EIRMA), and the American Chemical Society. In-depth discussions were held with industry R&D managers from 11 companies based in the United States and Europe as well as representatives of the Organization for Economic Cooperation and Development, the European Commission, and the Swedish Institute for Growth Policy Studies. These discussions probed a variety of issues related to R&D strategy and factors, both internal and external to the firm, that were considered in deliberations on placement of R&D facilities, as well as the mechanisms used to protect and capitalize on intellectual property created in sites at home and elsewhere. Detailed comments were solicited on a series of draft survey documents. In April 2005, the survey document was transcribed to the web-based survey software of SurveyMonkey. Survey beta tests were conducted in late April and early May. Survey responses were obtained beginning in late May 2005. The appendix provides information on the potential pool of respondents, response rate, and information on the statistical tests reported in the text.