address perceived military and nonmilitary security threats, including satellite warning and monitoring systems, rockets, nuclear reactors, scanners, advances in fertility with respect to crops and marine life, alternative energy technologies, and alternatives to rare-earth metals needed in industrial processes.

Although growth in Japan’s GDP averaged 4 percent per year between 1975 and 1990, it declined to an average of 1.3 percent per year in the following decade (Motohashi, 2005). Alarmed by its stagnating economy, Japan introduced new innovation policies in 1995, which were aimed at revitalizing its innovation capability and energizing its economic growth. The new policies, modeled in part after similar policies in the United States, included major reforms to improve S&T partnerships between universities and industry, and the enactment of a new intellectual property (IP) policy allowing universities, small businesses, and nonprofits to claim ownership of innovations developed with federal funds (akin to the Bayh-Dole Act of 1980 in the United States). In addition, the budget for funding S&T research was increased significantly; in 2007, Japan’s total R&D expenditures equaled 3.67 percent of its gross domestic product (GDP), the highest among industrialized nations (compared to 2.68 percent in the United States), with a 5 to 1 ratio of private-sector to public-sector spending.


In Japan, several ministries are involved in S&T policy, but coordination is managed by a cabinet office called the Council for Science and Technology Policy (CSTP), which reports directly to the Prime Minister. Attention to S&T policy at the executive level gives Japan a potential advantage relative to other industrialized nations in terms of enacting transformational policies with long-term impact on research, education, and technology innovation.

Japan’s S&T planning is closely linked to perceived threats to security, each of which is the subject of one or more national-level R&D projects. The most urgent concern, a ballistic missile attack from North Korea, is the subject of a high-priority R&D effort to improve early warning capability through the development of a new generation of high-performance satellites and launch vehicles. The threat of terrorism originating abroad is being addressed through the development of satellite surveillance capabilities for all of Japan’s territories and the development of portable scanners for inspection of luggage. Japan’s concerns over energy and resource security are the subjects of R&D projects to enhance its ability to access seabed resources, drastically curtail energy consumption, produce energy from biomass, and develop technological alternatives to rare-earth elements. The latter initiative is of particular importance because China currently accounts for 97 percent of global rare-earth-element production and is restricting export quotas in response to growing domestic demand. Japan is also engaged in efforts to secure its future rare-earth-element supply through stockpiling and acquiring foreign mines (Hurst, 2010). Threats to food security are being addressed through R&D programs to improve crop yields in poor environments and to replenish the dwindling population of fish in nearby waters. Although the close linkage of Japan’s security concerns to specific threats is impressive, the country’s ability to contain these threats through S&T is questionable, reflecting weaknesses in Japan’s S&T infrastructure.1

Institutional Reforms

Japan changed its funding model for research by increasing the fraction allocated to competitive funding; between 1991 and 2005, that fraction increased sixfold. Equally significant was Japan’s move (starting in 2004) to separate its national universities and research institutes from the government’s civil service system, thereby giving them more autonomy to define their roles and allocate their resources, and more freedom to work cooperatively with industry. This policy will likely pay great future dividends to Japan in the form of enhanced research productivity and an environment that is more conducive to technological innovation.


Many of these weaknesses are acknowledged in Japan’s Science and Technology Basic Plan (2006) in the form of objectives for “Reforming the S&T System.” They include “creating an environment where individuals thrive,” “supporting the independence of young researchers,” “improving the mobility of human resources,” “suppressing the rate of inbreeding in faculties,” “promoting the activities of female researchers,” “drastic enhancement of graduate education,” “promoting the activities of foreign researchers,” “resolving the institutional and operational bottleneck that acts against S&T activities,” “reforming the research fund system beyond office and ministries,” “developing industry-government-university trust,” and “promoting the entrepreneurial activities of R&D ventures” (CSTP, 2006).

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