Sunday, November 1, 2015

Myths behind government funding of science

The Myth of Basic Science - Matt Ridley, Wall Street Journal:

October 23, 2015 - "Politicians believe that innovation can be turned on and off like a tap: You start with pure scientific insights, which then get translated into applied science, which in turn become useful technology. So what you must do, as a patriotic legislator, is to ensure that there is a ready supply of money to scientists on the top floor of their ivory towers, and lo and behold, technology will come clanking out of the pipe at the bottom of the tower.... Yet recent scholarship has exposed this tale as a myth....

"For more than a half century, it has been an article of faith that science would not get funded if government did not do it, and economic growth would not happen if science did not get funded by the taxpayer.... [Yet] there is still no empirical demonstration of the need for public funding of research and ... the historical record suggests the opposite.

"[I]n the late 19th and early 20th centuries, the U.S. and Britain made huge contributions to science with negligible public funding, while Germany and France, with hefty public funding, achieved no greater results either in science or in economics. After World War II, the U.S. and Britain began to fund science heavily from the public purse. With the success of war science and of Soviet state funding that led to Sputnik, it seemed obvious that state funding must make a difference.... Yet there was no growth dividend for Britain and America from this science-funding rush. Their economies grew no faster than they had before.

"In 2003, the Organization for Economic Cooperation and Development published a paper on the 'sources of economic growth in OECD countries' between 1971 and 1998 and found, to its surprise, that whereas privately funded research and development stimulated economic growth, publicly funded research had no economic impact whatsoever. None. This earthshaking result has never been challenged or debunked. It is so inconvenient to the argument that science needs public funding that it is ignored.

"In 2007, the economist Leo Sveikauskas of the U.S. Bureau of Labor Statistics concluded that returns from many forms of publicly financed R&D are near zero and that 'many elements of university and government research have very low returns, overwhelmingly contribute to economic growth only indirectly, if at all.'

"As the economist Walter Park of American University in Washington, D.C., concluded, the explanation for this discrepancy is that public funding of research almost certainly crowds out private funding. That is to say, if the government spends money on the wrong kind of science, it tends to stop researchers from working on the right kind of science.

"To most people, the argument for public funding of science rests on a list of the discoveries made with public funds, from the Internet (defense science in the U.S.) to the Higgs boson (particle physics at CERN in Switzerland). But that is highly misleading. Given that government has funded science munificently from its huge tax take, it would be odd if it had not found out something. This tells us nothing about what would have been discovered by alternative funding arrangements. And we can never know what discoveries were not made because government funding crowded out philanthropic and commercial funding."

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