The Economics Show The economics of research and development. With Heidi Williams
Oct 28, 2024
Heidi Williams, a Professor of Economics at Dartmouth College and innovation policy expert, joins to delve into the pivotal role of research and development. Discover the surprising economic benefits of both public and private R&D funding. Williams emphasizes that government investment is crucial for innovation while addressing misconceptions about its value. The discussion also unpacks the rapid impacts of R&D on economic growth and the need for better integration of research insights into policy-making. Tune in for a thought-provoking exploration of the economics of innovation!
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R&D Crowd-Out Concerns
- Government R&D funding often complements, not crowds out, private investment.
- It expands opportunities, especially in basic research, as exemplified by NIH drug development leads.
Quantifying R&D Returns
- Returns from R&D include new medicines, improved health, and faster economic growth.
- Federally funded R&D contributes an estimated 25% to US productivity growth since 1970.
R&D vs. Infrastructure Investment Returns
- R&D spending may yield substantial returns, estimated around $2 for every $1 invested.
- This contrasts with the typical 9.2 cent return on physical infrastructure investments.