Innovation is often thought to emerge naturally only from the free market, and while this is true to some extent, the reality is that the federal government plays an instrumental role in bolstering innovation as well. There are multiple ways the government can spur innovation, and the CBO categorizes such actions into two groups: the first is federal spending and tax policies, and the other is changing legal and regulatory systems already in place (Musick and Webre 1).
One of the major ways the federal government can bolster innovation is by investing and appropriating federal resources towards improving both public and private research and development (R&D) efforts. R&D is one of the primary forms of strategic innovation, and it is instrumental …show more content…
In fact, studies show that the social benefits gained from R&D justifies higher federal spending on R&D (Musick and Webre 9; Bloom, et al. 9). Despite this fact, federal spending on R&D has decreased drastically since the end of the space race during the Cold War. While dollar spending on innovation has increased by “more than 100 times from 1949 to 2013, rising from $940 million to $132 billion,” the actual percentage of GDP spent on R&D “decreased by more than half…from 1.92 percent in 1964 to 0.86 percent in 2013” (West and Bleiberg). The decrease in federal spending for R&D can be attributed to recent discretionary caps on the federal budget through 2021 that restrict spending on “programs funded through annual appropriations acts” that includes R&D and education, among others (Musick and Webre 13). To account for this decrease in federal spending on R&D, private, industrial, and non-federal entities now spend more on R&D than the federal government does, amounting to 2 percent of GDP (West and Bleiberg). Overall, the …show more content…
Notably, the CBO states that the current immigration policy can shift its focus from family reunification to bringing in more high-skilled labor into the country (Musick and Webre 4). Additionally, the government can allow foreign-born students pursuing STEM fields to stay in the United States after graduating (Musick and Webre 3). Doing so will strengthen the nation’s labor force, and giving diverse and educated people from various cultures the chance to enter the market will help develop new innovations and technology. Furthermore, the CBO also suggests modifying regulatory goals by making innovation a priority over other federal regulations (Musick and Webre 3). These are just a few of the many ways the federal government can bolster the currently declining state of innovation. Using federal policy to promote innovation is imperative if the United States wants to uphold a sound domestic state that benefits its citizens, and if it wants to remain competitive and relevant in a rapidly evolving global
One of the major ways the federal government can bolster innovation is by investing and appropriating federal resources towards improving both public and private research and development (R&D) efforts. R&D is one of the primary forms of strategic innovation, and it is instrumental …show more content…
In fact, studies show that the social benefits gained from R&D justifies higher federal spending on R&D (Musick and Webre 9; Bloom, et al. 9). Despite this fact, federal spending on R&D has decreased drastically since the end of the space race during the Cold War. While dollar spending on innovation has increased by “more than 100 times from 1949 to 2013, rising from $940 million to $132 billion,” the actual percentage of GDP spent on R&D “decreased by more than half…from 1.92 percent in 1964 to 0.86 percent in 2013” (West and Bleiberg). The decrease in federal spending for R&D can be attributed to recent discretionary caps on the federal budget through 2021 that restrict spending on “programs funded through annual appropriations acts” that includes R&D and education, among others (Musick and Webre 13). To account for this decrease in federal spending on R&D, private, industrial, and non-federal entities now spend more on R&D than the federal government does, amounting to 2 percent of GDP (West and Bleiberg). Overall, the …show more content…
Notably, the CBO states that the current immigration policy can shift its focus from family reunification to bringing in more high-skilled labor into the country (Musick and Webre 4). Additionally, the government can allow foreign-born students pursuing STEM fields to stay in the United States after graduating (Musick and Webre 3). Doing so will strengthen the nation’s labor force, and giving diverse and educated people from various cultures the chance to enter the market will help develop new innovations and technology. Furthermore, the CBO also suggests modifying regulatory goals by making innovation a priority over other federal regulations (Musick and Webre 3). These are just a few of the many ways the federal government can bolster the currently declining state of innovation. Using federal policy to promote innovation is imperative if the United States wants to uphold a sound domestic state that benefits its citizens, and if it wants to remain competitive and relevant in a rapidly evolving global