DATA COLLECTION AND ANALYSIS

A basic question is whether lack of information about foreign investment and the activities of foreign firms in the United States hobbles policymakers. How to balance the benefit of timely and complete information about FDI from Japanese and other foreign companies with the tradition of national treatment is another important question.

Data collected and published by the Department of Commerce's Bureau of Economic Analysis could be augmented and provided on a more timely basis to policymakers.62 Some of the obstacles to enacting and implementing proposed changes can be traced to a reluctance to expend resources on data collection in the current atmosphere of Federal budget constraints. Others relate to differences of view about whether changing the reporting requirements would disadvantage foreign firms doing business in the United States.

A number of benefits might be realized from more disaggregated and complete data. For example, figures on trends in productivity, R &D spending and technology licensing at Japanese-owned subsidiaries would be invaluable to a deeper understanding of the actual situation in specific industries with regards to technology transfer. Information on the technological aspects of Japanese and other foreign MNC behavior may also be useful to U.S. government policymakers seeking to promote commercial technology development. While academic analyses and news reports on industry-specific aspects of the technology transfer issue are valuable and not necessarily inaccurate, the evidence remains incomplete and impressionistic. More detailed information would aid the CFIUS process of reviews of investments that raise potential national security problems.

The goal of the Foreign Direct Investment and International Financial Data Improvements Act of 1990 was to provide better data without damaging the confidentiality underlying current reporting practices, and with-

62  

See Graham and Krugman, op. cit., p. 135-143, and U.S. General Accounting Office, Foreign Investment: Federal Data Collection on Foreign Investment in the United States, GAO, 1989.



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