Strengthening Innovation Policy: updating the Strategy for American Innovation

Earlier this summer, the White House Office of Science and Technology Policy and the National Economic Council issued a Request for Comments as part of a review and update of the Administration’s Strategy for American Innovation. Yesterday, Athena Alliance submitted its comments — “Strengthening Innovation Policy” — written by myself and Stephen Merrill. In the document we propose policies and actions in five areas responding to specific questions raised in the Request for Comments:
  • Understanding How Intangible Assets Fuel Economic Growth
  • Enhancing Policy Development and Implementation
  • Evaluating Administration Initiatives
  • Foster Design Thinking
  • Financing Innovation Through Intellectual Property
Understanding How Intangible Assets Fuel Economic Growth
Question (2) of the request asks about the biggest challenges to, and opportunities for, innovation. The biggest opportunity is to build upon our intangible capital. Our biggest challenge is understanding how to carry out that task. Increased investment in intangibles is not enough. Investments must be effective in raising productivity. Cross national studies clearly show that increasing investments in intangible assets raises productivity. Those studies also show that other nations have larger productivity increases. We propose a research agenda to understand why the U.S. lags other nations in translating intangibles investment into productivity gains. (See also earlier posting.)
Enhancing Policy Development and Implementation
Question (4) asks about augmenting the government’s capacity for analysis. In response, we propose the creation of a new system for the review and implementation of U.S. economic competitiveness policy. That system would include a Quadrennial Competitiveness Assessment by an independent panel; a Biannual Presidential Competitiveness Strategy; an Interagency Competitiveness Task Force; and a Presidential Competitiveness Advisory Panel. (See also earlier posting.)
Evaluating Administration Initiatives
Also in response to question (4), we see the need to look at specific recent initiatives. In the past six years the Administration has instituted or expanded several measures to promote innovation and improve our understanding of it — such as the Science of Science and Innovation Policy (SciSIP) program at NSF, the Advanced Research Projects Agency-Energy (ARPA-E), the SBA Regional Innovation Cluster Initiative and the National Network for Manufacturing Innovation. We propose that the Administration strengthen its legacy by commissioning an independent interim assessment of good practices as well as the shortcomings of the most important measures.
Foster Design Thinking
Question (6) concerns itself with changes to the innovation process. Two of the major shifts in the innovation process have been the increasing importance of non-technological aspect especially the role of design and the emphasis on user input in an iterative process. These two have combined to create an innovation process know as design thinking. To foster design thinking, we propose funding 5 colleges or universities to create design schools (d.schools) similar to the Stanford (Hasso Plattner Institute of Design). The proposal builds upon the “manufacturing universities” proposal to grant 25 universities $5 million each per year for four years to revamp their engineering teaching and research activities toward manufacturing and engage in greater joint industry-university research projects. At $5 million per year for 5 schools, the total budget for creating new design schools would be $25 million. (See also earlier postings.)
Financing Innovation Through Intellectual Property
Question (15) and (17) concern, in part, the development of new mechanisms for financing innovation. Our proposal is for a first step in better utilizing intellectual property (IP) in the lending process. The Small Business Administration (SBA) and U.S. Patent and Trademark Office (USPTO) should convene a working group of lenders, regulators and other interested parties to develop a common template to be used when describing and valuing IP and intangible assets used implicitly or explicitly as collateral. The Intellectual Property Office in the United Kingdom (UK IPO) is already undertaking such an activity. Any U.S. effort should communicate, and to the extent possible coordinate, with that activity. (See also earlier postings).
For a more in-depth discussion of these recommendations, see the full document “Strengthening Innovation Policy”.

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