1. Are there lessons and insights to be drawn from the U.S. science and technology relationship with Japan with implications for how the United States—government, industry and research institutions—should approach international relationships in the future? How should the United States build science and technology links with key individual countries and regions, most importantly Japan but also including China and other emerging Asian economies? How should the United States approach such issues as multilateral harmonization of market and innovation systems in areas such as R&D subsidies, consortia, and intellectual property protection?

With its focus on the conditions necessary to maintain high wage employment for U.S. citizens, the committee is putting its emphasis on the interests of Americans in their role as producers. Superior research and development, and effective utilization by companies that maintain significant capabilities to innovate and manufacture in the United States, whether they are based in the United States, Japan or elsewhere, are the necessary conditions. The task force recognizes that Americans have an additional stake in U.S.-Japan science and technology relations as consumers, although this linkage is not a major focus of the report. U.S. citizens derive benefits from Japanese innovation when they purchase Japanese high-technology products. U.S. consumers also benefit from competition in high-technology markets, which expands consumer choices and lowers prices over time.

To chart a course for the future of the U.S.-Japan science and technology relationship that advances U.S. economic and competitiveness interests, it is necessary to understand Japanese and U.S. approaches to innovation; how these approaches have developed, particularly over the past four decades; and how U.S. and Japanese interactions in science and technology have been shaped by this historical context. Chapter 2 describes the institutional framework for innovation in Japan, including historical background. Chapter 3 provides similar background for the United States.

Chapter 4 reviews the statistical and policy context for U.S.-Japan science and technology relationships and competitive trends. Chapter 5 reviews information gathered by the committee on U.S.-Japan science and technology relationships and competitiveness trends in several key industries. Chapter 6 outlines the committee's approach to defining U.S. economic and competitiveness interests in science and technology relations with Japan and contains a discussion of key issues and policy options for the United States. Chapter 7 presents the committee's conclusions and recommendations.

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