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Seed Corn

Posted by: Michael Mandel on May 09

Americans are often accused of being too focused on consuming today, and not enough on investing for tomorrow.

That’s wrong, according to the latest numbers from the National Science Foundation. U.S. spending on basic research—the stuff with a payoff way in the future—stands at 0.5% of GDP, the highest on record, as of 2003 (the last numbers available). That’s up from an average of 0.42% in the 1990s, and an average of 0.36% in the 1980s, an average of 0.31% in the 1970s.

This is the ‘seed corn’ that economists are so fond of talking about. It’s being planted for the future, not eaten.

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Reader Comments

Jack K. Miller

May 9, 2005 02:47 PM

Thank you for the post. Most of the time, we only read that Americans do not save enough or other depressing stories.

Janet Tokerud

June 11, 2005 06:38 PM

I just read Three Billion New Capitalists and he points out that even though the total research budget is up, it's being spent on stuff that won't necessarily help all that much for growth. You can't just take total dollars as a fraction of GDP. It matters what the money is spent on.

Michael Mandel

June 12, 2005 03:42 PM

Janet, I assume that Prestowitz (the author of Three Billion Capitalists) means that we are spending too much on health care and biotech research, rather than info technology and other *hard* sciences that could increase productivity.

I disagree 100%. I think the bulk of our R&D expenditures are going into precisely what we need for the future--innovations which could revolutionize health care and biology.

Thank you for your interest. This blog is no longer active.



Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

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