creased support for some large industrial R&D 

 laboratories were detrimental to science and 

 technology. The panelists related this funding 

 change to decreases in productivity and in 

 beneficial technological advance, and weaken- 

 ing of the international trade position of the 

 United States. The group (76 percent) also rated 

 the effects of a decrease in R&D activities of 

 small firms as detrimental. They warned against 

 the loss of important innovative groups and the 

 technical obsolescence of small firms. However, 

 40 percent of the panelists believed the un- 

 favorable consequences would be minimal be- 

 cause significant advances require greater 

 capabilities than are usually available to small 

 firms. 



Finally, the panel registered mixed reactions to 

 the reduced rate of initiation of construction of 

 "Big Science" facilities. The majority of panel- 

 ists viewed the change as detrimental, and 

 related it to a decrease in the rate of discovery in 

 the long run, decline in the rate of research 

 activity, and loss of international scientific 

 leadership. 



Panel 3—14 Panelists 



Changes Needed to Improve 



Technological Innovation 



and Diffusion 



This examination attempts to identify major 

 impediments to technological innovation and 

 diffusion in this country, and actions which 

 might be taken to improve the situation. The 

 impediments of both types suggested by the 

 panel are presented in table C. 



The major impediments to technological 

 innovation which the group identified can be 

 grouped into three areas related to (a) incen- 

 tives and government policies, (b) industrial 

 management, and (c) research activities and 

 manpower. Some of the suggested factors, how- 

 ever, were regarded as beneficial by several of 

 the panelists, including patent policies which 

 inhibit innovation (25 percent); lack of a govern- 

 ment agency to support the introduction of tech- 

 nological innovation (18 percent); and antitrust 

 laws which prohibit cooperative ventures (17 

 percent). 



Major impediments to the diffusion of innova- 

 tions can be grouped into (a) lack of financial 



incentives and characteristics of the market for 

 innovative products and services, (b) policies and 

 practices of industry itself, and (c) human re- 

 sources. Several panelists evaluated the sug- 

 gested factors as actually beneficial including: 

 oversized, overorganized industry (22 percent); 

 lack of a government agency to support the 

 introduction of technological innovation (18 per- 

 cent); and antitrust laws which prohibit coopera- 

 tive ventures (17 percent). 



Panel 4—12 Panelists 



Adequacy of Current Basic 

 Research Efforts 



This inquiry assessed the appropriateness of 

 the total funding level for basic research in terms 

 of: 



(a) Criteria considered to be important in 

 determining an appropriate funding 

 level for basic research, and the 

 appropriateness of the current level on 

 the basis of these criteria, 



(b) Propensity for "risk-taking" in poten- 

 tially "high-payoff" areas of research, 

 and 



(c) Factors perceived to be impeding basic 

 research in general. 



Criteria for Support of Bnsic Research 



The panelists emphasized the significance of 

 both external factors and the opportunities and 

 needs of the scientific enterprise itself, in 

 determining an appropriate funding level for 

 basic research (table D). Using these criteria, 

 they suggested moderate increases, ranging 

 from 2 to 12 percent, over the 1972 funding 

 levels. The average of the proposed increases 

 would raise the total funding in current dollars 

 to $4.4 billion in 1973. 



High Risk-High Payoff Research 



The panelists also evaluated the adequacy of 

 basic research efforts by assessing the propen- 

 sity to undertake "high risk-high payoff" basic 

 research. "High risk-high payoff" basic research 

 refers to projects which may have a low 

 probability of producing results and yet promise 

 results, if achieved, of such significance that the 

 projects are deemed worth the risk. An example 



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