Many people in Washington are worried that America’s strength in developing new technology is waning, harming our future competitiveness. While disaster is far from imminent, there is cause for concern. We are less productive at inventing new technologies than several key competitors.
There are many ways to measure a nation’s prowess at inventing new technology, but one that many policy makers examine is the number of patent filings per million dollars of research and development expenditure. Since patented inventions are an output and research and development (R&D) expenditure is an input, countries that generate a larger number of patents per dollar spent on research and development are more efficient than those that generate fewer patents per R&D dollar.
As the figure below shows, the United States is far less productive at inventing than Japan, China or Korea. For every dollar spent on R&D, Japan produces more than twice as many technological inventions as we do, China produces nearly three times as many, and Korea produces more than four times our number.