Abstract

Based on case studies of 40 major innovations in the post-World War II period, we assess the role of the federal government in the development of new products, industries, and companies. To guide our selection of major innovations, we identify general purpose technologies (GPTs) that were established during this period. GPTs generate substantial positive spillovers and have broad economic and social effects. Given that universities and federal/national labs conduct the overwhelming majority of federally-funded research and have also been heavily involved in the development of GPTs, we focus on the role of these institutions in our analysis of technological diffusion. Two key stylized facts emerge from our analysis. The first is that many innovations with significant commercial applications were initially developed and adopted by military and space agencies (e.g., nuclear energy, electronics, computers and the Internet, airplanes, laser technology, biotechnology, and pharmacogenomics). The second is that the role of the federal/national labs in technology development and technology transfer may be understated, given that university technology transfer has generated much more attention in academia and the popular press.

Assessing the Role of the Federal Government in the Development of New Products, Industries, and Companies: Case Study Evidence since World War II

Assessing the Role of the Federal Government in the Development of New Products, Industries, and Companies examines the role of the federal government in the development of major innovations. This is done in a purely descriptive manner, specifically identifying and describing major products, industries, and firms resulting from U.S. government funding of research in the years since World War II (WWII). It is well known that during WWII and the famous "Manhattan Project," the Los Alamos and Oak Ridge National Laboratories played a key role in the development of the atom bomb and nuclear energy. What is less well known is the role of the federal and national labs in the development of such key technologies as radar, lithium-ion batteries, and computers. The evidence clearly shows that these investments in military and space R&D ultimately had numerous signifi cant commercial applications.

This monograph is organized as follows. First, it outlines a strategy for identifying major products, industries, and companies resulting from government funding in the years since WWII, requiring the authors to defi ne the concept of a general purpose technology (GPT). They conclude with a description of 40 innovations that have had a major impact on our economy and society. The description of these innovations contains fairly-detailed explanations of how these products were developed and how they made their way from lab to market. The outcomes of these federal investments in technology are quite impressive, both in terms of their economic and social impacts.