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(1) the strength of the domestic economy, (2) the competitive position 

 in international markets, and (3) the complexion of political 

 relationships. 



Changing Attitudes 



Historically, the United States has taken a relatively neutral 

 position until recently on technology transfer, with the exception of 

 transfers to the USSR and transfers of military technology in 

 general. Most U.S. technology has been transferred across 

 international boundaries through private trade and investment. In 

 open international economic systems, it has been assumed that all 

 nations are better off as a result of the transfers that occur. There 

 is a changing perception, however, that one nation's technological 

 gain is another's loss. Over the past several years the balance has 

 shifted toward a more restrictive technology transfer policy and 

 associated export controls, not only with the USSR but with our 

 traditional trading partners as well. This perception complicates the 

 argument based on mutuality of benefits for international cooperation 

 in technical fields. 



Technology Transfer with the European Community and Japan 



The position of technological leadership held by the United States 

 after World War II has faltered in many areas, and some have alleged 

 an imprudent transfer of technology to our allies as the cause. 

 However, the decline is the result of many factors that include the 

 following: 



o Europe and Japan increased their national investment in 



research and development relative to gross national product; 

 and the United States decreased its relative expenditures from 

 1965 through 1978, after which they began to rise again. Of 

 course, in absolute terms, such U.S. expenditures considerably 

 exceed those of other countries. 



o A greater proportion of all research and development has gone 

 for military purposes in the United States than in Europe and 

 Japan. 



o The two-way flow of much technological information, quite 



beyond the applicability of even the severest export control 

 rationale, is normal and inevitable. 



o There has been an increasing demand in the United States for 

 near-term results for research and development expenditures 

 that has inhibited the accumulation of a base for long-term 

 technological applications. 



