Methodological and Technological issues in Technology Transfer

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4.12.1 Publicly-funded research and publicly owned technology6

Historically, governments have played a key role in supporting research and development through national laboratories, universities, and through international collaborative ventures. In the report of the international expert meeting on the role of publicly-funded research and publicly-owned technologies, it is stated that "…many governments emphasise the contribution that public support to R&D can make to economic competitiveness and the importance of commercialising publicly-funded R&D. The country case studies presented at this meeting indicate that public funding remains a major source for R&D activities in both industrialised and developing countries. Public funding of R&D, according to the UNCTAD, UNEP and UNDESA paper, usually takes two forms: general support to national R&D institutions and laboratories, and direct funding of specific projects according to set government priorities (UNCTAD et al., 1998). Investment by OECD governments in energy expanded dramatically after the oil shocks, and was maintained at high levels during the 1970s, but overall government energy RTD has declined steadily since the early 1980s (Margolis and Kammen, 1999; Clark, 1999). However, some governments, especially in Europe, have invested steadily rising amounts towards renewable energy and other environmentally sound energy sources. The EU's fourth framework programme on research and development for 1994 to 1998 provided significant financial resources for non-nuclear activities. The framework programme also includes climate-related research programmes such as EPOCH, and the science and technology for environmental protection (STEP) programme. Many governments are very much aware of the international dimension of global environmental degradation and the role of ESTs in addressing the problems. A recent OECD study concluded that industrial output from non-OECD countries will triple by the year 2010 as compared to 1990, and this would have direct implication for cleaner production technologies; therefore, OECD member countries must give attention to technology and information transfer (OECD, 1995).

There is a close relationship between the governments and the private sectors because RTD results 'spill over'. The literature on the returns to RTD spending consistently show that the social rate of return is higher than the private return (for example, Evenson et al., 1979; Goto and Suzuki, 1989; Suzuki, 1993; Coe and Helpman, 1995; Bernstein, 1996; Griliches, 1992). This is because part of the return to RTD is a "public good" that cannot entirely be appropriated by the organisation making the investment. It has been estimated that optimal R&D investment is at least four times larger than actual RTD investment (Jones and Williams, 1998). Similarly, the "new growth theory" has drawn the attention of economists and development specialists to the spillovers from investments in education and capital formation that raise social productivity above the gains that can be realised by the private-sector agents making the investments (Romer, 1986a, 1986b, 1988, 1994; Lucas, 1988). These spill-overs constitute a strong justification for public policy to raise the level of private investment. These considerations apply to investments that transfer new and improved carbon-reduction technologies.



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