Science Investments…

They are something we do here at the Institute level when we buy a new piece of shared equipment, but they are also something a nation does when it sponsors R&D through agency grants programs or through national laboratories.  The below graph (full movie presentation go here) shows 2009 OECD data for researchers per 1000 employees (y-axis) versus National R&D as a percentage of GDP (x-axis). The bubble size adds a third dimension: non-normalized national R&D. What jumps out pretty clearly is that Finland is investing in science at a very high level. And, that the US, if one normalizes by either population or GDP isn’t the leader.

Although the public often sees these investments through the lens of the deficit, the larger context is a nation’s ability to grow its way out of its fiscal problems as opposed to deflation and massive deleveraging. Science investments create the “garden” environment for the next wave of technology revolutions that Tyler Cowen talks about in his recent book, The Great Stagnation.

How is science investment paying off for Finland? Having recently returned from Helsinki, I can report first hand evidence of a vibrant technology start-up community, perhaps Europe’s most healthy economy, and a K-20 education system that is a world-leader. To me those are side-payoffs from the science investment. And they are very important.

However the central payoff from national science investment is the increased probability of a “game changer” discovery that leads to a revolution on the scale of the Industrial Revolution. Because science is serendipitous as far fundamental discoveries are concerned, we can’t forecast them with any accuracy. What we can do is invest as much as possible so that the probabilities of great discoveries go up.