The relationship between science and technology in European advanced industrial economies, 1980--2000

Economists, policy analysts, and policy makers alike are puzzled by an intriguing fact regarding technological innovation in some advanced industrial economies. Europe as a whole, in spite of its relatively strong scientific performance, paradoxically does not fare so well in technological innovation. European wide policy initiatives in the early 1980s have sought to improve the worldwide competitiveness of Europe in high tech. They have focused much on improving Europe's capacity to apply its good science base in practice, resulting in increased technological advancement and implicitly in improved market presence and enhanced economic growth. Two decades after the initiation of the policies, some European countries do not conform to the expected relationship between science and technology, whereby strong performance in science shall lead to strong technological performance. This is even more puzzling as the UK, a historical stronghold of inventions and innovations, finds itself among countries with weak technology, or as Germany, a historical stronghold of scientific discovery, finds itself among countries with weaker than average scientific performance.;The relationship between science and technology is very much interdependent or symbiotic. The strength and primary direction of the relationship at a given moment in time varies largely by field of science or technological innovation, as well as across long periods of time. In this exploratory study, I identify plausible explanations for the puzzling relationship between science and technology in certain economically advanced countries. I find that: (1) The science-technology link in a country may depend on the overall scientific and technological level of development in that country. The strength and interdependent nature of this link has a historical evolution that varies across fields of science and technology. The strength of the link between science and technology in a country is affected by scientific and technological specialization. Different technological fields have different scientific intensities, or degrees of building upon the science base. Specialization of countries across scientific and technological fields varies, making it natural for the strength of the science-technology link to differ from one country to another. The high technological specialization of a country may impact its technological performance more than its immediately current scientific performance does. (2) High levels of foreign funded R&D in a country may mislead the measurement of the technological performance of that country. (3) Dependence of a national economy on R&D intensive sectors may impact the image of that country in terms of its technological performance.;As there are plausible explanations for the puzzling behavior of the science-technology link in developed countries, I convert these explanations into a few suggested policy recommendations.