Below are the first 10 and last 10 pages of uncorrected machine-read text (when available) of this chapter, followed by the top 30 algorithmically extracted key phrases from the chapter as a whole.
Intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text on the opening pages of each chapter. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.
Do not use for reproduction, copying, pasting, or reading; exclusively for search engines.
OCR for page R1
Japan's Growing Technological Capability: Implications for the U.S. Economy Japan's Growing Technological Capability Implications for the U.S. Economy THOMAS S. ARRISON, C. FRED BERGSTEN, EDWARD M. GRAHAM, AND MARTHA CALDWELL HARRIS, Editors Committee on Japan Office of Japan Affairs Office of International Affairs National Research Council NATIONAL ACADEMY PRESS Washington, D.C. 1992
OCR for page R2
Japan's Growing Technological Capability: Implications for the U.S. Economy NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance. This report has been reviewed by a group other than the authors according to procedures approved by a Report Review Committee consisting of members of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The National Academy of Sciences is a private, nonprofit self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Frank Press is president of the National Academy of Sciences. The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievement of engineers. Dr. Robert M. White is president of the National Academy of Engineering. The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Kenneth I. Shine is president of the Institute of Medicine. The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy's purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Frank Press and Dr. Robert M. White are chairman and vice-chairman, respectively, of the National Research Council. The conference and resulting conference volume were made possible with funding support from the Rockefeller Brothers Fund and the U.S. Department of State Bureau of Intelligence and Research. Available from: Office of Japan Affairs National Research Council 2101 Constitution Avenue, N.W. Washington, DC 20418 National Academy Press 2101 Constitution Avenue, N.W. Washington, DC 20418 Library of Congress Catalog Card Number 92-85459 International Standard Book Number 0-309-04780-3 S628 Copyright © 1992 by the National Academy of Sciences Printed in the United States of America First Printing, November 1992 Second Printing, May 1993
OCR for page R3
Japan's Growing Technological Capability: Implications for the U.S. Economy COMMITTEE ON JAPAN Erich Bloch, Chairman Council on Competitiveness C. Fred Bergsten Institute for International Economics Lewis M. Branscomb Harvard University Harold Brown Center for Strategic and and International Studies Lawrence W. Clarkson The Boeing Co. I. M. Destler University of Maryland Mildred S. Dresselhaus Massachusetts Institute of Technology Daniel J. Fink D. J. Fink Associates, Inc. Ellen L. Frost Institute for International Economics Lester C. Krogh 3M Co. E. Floyd Kvamme Kleiner Perkins Caufield & Byers Yoshio Nishi Hewlett-Packard Co. Daniel I. Okimoto Stanford University John D. Rockefeller IV United States Senate Richard J. Samuels MIT Japan Program Robert A. Scalapino University of California, Berkeley Hubert J. P. Schoemaker Centocor, Inc. Ora E. Smith Illinois Superconductor Corp. Albert D. Wheelon Hughes Aircraft Co. (retired) Ex Officio Members: Gerald P. Dinneen, Foreign Secretary, National Academy of Engineering James B. Wyngaarden, Foreign Secretary, National Academy of Sciences and Institute of Medicine
OCR for page R4
Japan's Growing Technological Capability: Implications for the U.S. Economy OFFICE OF JAPAN AFFAIRS Since 1985 the National Academy of Sciences and the National Academy of Engineering have engaged in a series of high-level discussions on advanced technology and the international environment with a counterpart group of Japanese scientists, engineers, and industrialists. One outcome of these discussions was a deepened understanding of the importance of promoting a more balanced two-way flow of people and information between the research and development systems in the two countries. Another result was a broader recognition of the need to address the science and technology policy issues increasingly central to a changing U.S.-Japan relationship. In 1987 the National Research Council, the operating arm of both the National Academy of Sciences and the National Academy of Engineering, authorized first-year funding for a new Office of Japan Affairs (OJA). This newest program element of the Office of International Affairs was formally established in the spring of 1988. The primary objectives of OJA are to provide a resource to the Academy complex and the broader U.S. science and engineering communities for information on Japanese science and technology, to promote better working relationships between the technical communities in the two countries by developing a process of deepened dialogue on issues of mutual concern, and to address policy issues surrounding a changing U.S.-Japan science and technology relationship. Staff Martha Caldwell Harris, Director Thomas Arrison, Research Associate Maki Fife, Program Assistant
OCR for page R5
Japan's Growing Technological Capability: Implications for the U.S. Economy Preface Less than 50 years since the end of World War II, Japan has transformed itself from a defeated nation with a devastated economy to an economic superpower. The reasons for the rise of Japan to economic superpower status are multifaceted, but one of the most striking reasons has been the growing prowess of Japanese firms in high technology industries. As little as two decades ago, Japanese firms were generally considered to be marginal players in these industries. Today, by contrast, Japanese firms are now the acknowledged technological leaders in many advanced sectors. Even in other high technology sectors where the high ground is still held by U.S. firms, Japanese firms are often the prime challengers. The high technology prowess of Japanese firms is indeed a main reason why Japan is considered an economic superpower today. The growing Japanese role in high technology raises a number of questions for the United States. Some of these questions relate to the current status of the two countries, for example, in what industries do Japanese firms hold technologies more advanced than their U.S. rivals? Are there industries in which U.S. firms still lead but are under serious challenge by Japanese firms? Are there sectors in which a U.S. lead is widening? More fundamental questions can be asked as well. Why has the relative position of U.S. and Japanese firms in so many industries changed so drastically in such a short period of time? Is this trend likely to continue and, if so, why? How do Japan's growing capabilities in a wide range of high technology industries affect the relative competitiveness of the Japanese and U.S. economies? What other implications (other than those affecting competitiveness) does Japan's growing technological capability hold for the U.S. economy?
OCR for page R6
Japan's Growing Technological Capability: Implications for the U.S. Economy More specifically, is the research and development function within Japanese firms organized in such a way as to enable these firms to commercialize new technologies more effectively than their U.S. rivals? What are the implications of Japanese direct investment in the high technology sectors in the United States and the consequent control of U.S. R&D activities by Japanese firms? What should be the U.S. policy response to the Japanese challenge in this area? In 1991, the Committee on Japan of the National Research Council organized a symposium to address these and related issues. The papers included in this volume were first presented at that symposium entitled "Japan's Growing Technological Capability: Implications for the U.S. Economy" held at the National Academy of Sciences on October 23–24, 1991, and were revised later by the authors. The overview chapter was prepared after the symposium. This volume and the symposium are both parts of an ongoing effort by the Committee on Japan to explore new ways for the United States to compete and cooperate with Japan as a technological superpower. The authors of the papers are of diverse intellectual and institutional backgrounds; they come from Japan, the United States, and Europe; and they represent academia, government, and private industry. The symposium sought to bring together experts in technology along with economists who have studied the economics of technological innovation, in the hope that the two groups of individuals could learn from each other and help inform a broader policy audience. As a member of the Committee on Japan, I was pleased to serve as chairman of the symposium and as coeditor of this volume. My coeditors are Thomas Arrison and Martha C. Harris, both of the National Research Council's Office of Japan Affairs, and Edward M. Graham of the Institute for International Economics, all of whom (along with Maki Fife, also of the Office of Japan Affairs) worked with me to organize the symposium. Arrison and Harris authored the overview of the symposium included in this volume, which summarizes the principal conclusions of each of the papers. Graham contributed one of the papers as well as serving as coeditor of the volume. Dr. Erich Bloch, currently Chairman of the Committee on Japan, served as a commentator on the policy implications of the papers, and his remarks are included as the final chapter of this volume. The symposium and this volume were made possible by grants from the Rockefeller Brothers Fund and the Bureau of Intelligence and Research of the U.S. Department of State. On behalf of the Committee on Japan, I would like to thank both of these institutions for their generous support. C. Fred Bergsten, Chairman National Research Council Symposium on Japan's Growing Technological Capability: Implications for the U.S. Economy
OCR for page R7
Japan's Growing Technological Capability: Implications for the U.S. Economy Contents Overview Thomas S. Arrison and Martha Caldwell Harris 1 I. ASSESSMENTS OF U.S. AND JAPANESE TECHNOLOGICAL STRENGTHS AND WEAKNESSES Technology Assessment in the U.S.-Japan Context George Gamota 21 What Can We Learn from Technology Assessment? Shigetaka Seki 42 Accessing Japanese Technology: Experiences of a U.S.-Based Company Jim F. Martin 57 Studies of Japanese Technology: An Effort with Diminishing Returns? G. Laurie Miller 66 II. ECONOMIC IMPACTS AND IMPLICATIONS Technology, Productivity, and the Competitiveness of U.S. and Japanese Industries Dale W. Jorgenson and Masahiro Kuroda 83 Macroeconomic and Schumpetarian Features of Japanese Innovations in the 1980s Masaru Yoshitomi 98
OCR for page R8
Japan's Growing Technological Capability: Implications for the U.S. Economy The Changing Place of Japan in the Global Scientific and Technological Enterprise David C. Mowery and David J. Teece 106 Implications of Japan's "Soft Crisis": Forcing New Directions for Japanese Electronics Companies William F. Finan and Carl Williams 136 III. THE FUTURE OF COMPETITION Japan's Unique Capacity to Innovate: Technology Fusion and Its International Implications Fumio Kodama 147 Japan's Industrial Competitiveness and the Technological Capability of the Leading Japanese Firms John Cantwell 165 Japanese Control of R&D Activities in the United States: Is This a Cause for Concern? Edward M. Graham 189 IV. POLICY IMPLICATIONS Policy Implications of Japan's Growing Technological Capabilities: Framing the Issues Richard R. Nelson 209 Policy Implications for the United States: Comments Hiroshi Ota 216 Comments on Policy Implications Erich Bloch 221 APPENDIXES A. Contributing Authors 229 B. Conference on Japan's Growing Technological Capability: Implications for the U.S. Economy, October 23 and 24, 1991 234