Japan Continues R&D Investment Even In Bad Times

ByJohn S. McClenahen Although it's plagued by a host of economic troubles led by deflation, Japan continues to invest more in total R&D as a percentage of GDP than does the U.S. In 2000 the figure for Japan was 2.98%; for the U.S. in 2000, the most recent year for which comparable data are available, it was 2.69%, says Cliff Waldman, an economist at Manufacturers Alliance/MAPI, an Arlington, Va.-based business policy group. His study shows the U.S. putting a higher percentage of its economy into R&D than does Germany, but only modestly so. "R&D investment must be considered in a competitive context," says Waldman. "It is an essential avenue for creating new products and production methods that will give the U.S. economy and U.S. manufacturing the comparative advantage it needs in the current global environment."