Carlos M. Gutierrez
U.S. Secretary of Commerce
In today's highly competitive global economy, new tools are needed to promote
the innovation and entrepreneurship critical to dynamic growth and job creation.
Government's role is to create the environment for innovators and
entrepreneurs to succeed. This includes developing pro-growth policies. It also
includes developing the strategic public-private partnerships that promote the
creativity and advances that contribute to our society's safety, health, and
prosperity. People are our nation's greatest asset and, by combining the best
minds in all sectors, we can advance our economy and our quality of life.
Innovation and entrepreneurship flourish when our nation is open to new
people and ideas and engages with the world through commerce. U.S. intellectual
property today is worth more than $5 trillion. Intellectual property industries
contribute some 40 percent of U.S. economic growth and represent 18 million
well-paid workers. It has been estimated that intellectual property accounts for
about one-third of the value of publicly traded companies.
Obviously, innovation matters to our economy. Innovators and the
entrepreneurs who develop and market new products and services have an enormous
impact on our economy and our standards of living. We have more choices in the
marketplace and more efficient processes in our factories and offices.
But how is innovation measured?
Two years ago, I asked economists at the U.S. Department of Commerce to
analyze existing statistical measures of innovation. We discovered that
traditional innovation measurements, such as the amount spent on research and
development, the number of new patents, and the number of engineers, scientists,
and technicians currently employed, provide a useful, but incomplete, innovation
picture.
Our economy and our society are not static, and our measurements should not
be either. To reflect today's 21st century economy, we need new benchmarks for a
fuller understanding of the impact of innovation, and to help both government
and businesses identify and devise innovation-promoting policies that create
value and growth.
We invited business leaders and leading academics to participate on the
Advisory Committee on Measuring Innovation in the 21st Century Economy. Carl
Schramm, president and chief executive officer of the Ewing Marion Kauffman
Foundation, agreed to chair the new Committee.
In January 2008, the Committee delivered its report, which will serve as a
blueprint for creating a new era in innovation metrics. (To download the
committee's full report, visit
kauffman.org/innovation_measurement.)
Among the recommendations:
- Integrating the Bureau of Economic Analysis' (BEA) measure of gross
domestic product with the Bureau of Labor Statistics' productivity measurements
to allow for a comprehensive accounting of the effect of high-tech goods and
services on growth and productivity.
- Creating a BEA satellite innovation account for intangibles such as
intellectual property capital stocks (including patents, copyrights, and
trademarks) and worker training.
- Improving data consistency and accuracy across the various statistical
agencies by allowing the agencies to share tax data for statistical
purposes.
- Collecting data on a wider range of innovation activities performed by a
greater cross-section of industries to provide another piece of the puzzle as to
what drives innovation in the U.S. economy.
- Accessing outside expertise to determine the effects of government
regulation, taxes, the availability of labor, and other factors driving or
inhibiting innovation to give us a better sense of the benefits and costs
associated with a given policy.
We know that innovation contributes to the size, growth, and exports of the
U.S. economy. Developing the metrics to better measure the impact of innovation
will provide an important tool to government policymakers and business decision
makers. We are beginning to implement an action plan based on the Committee's
recommendations. And our first public forum, which focused on creating
workplaces that foster innovation, was hosted by the Kauffman Foundation in
Kansas City in March 2008.
The Kauffman Foundation also joined the Commerce Department in a unique
public-private partnership to create an "entrepreneurial constituency" for the
future by fostering entrepreneurship in the United States and around the world.
By creating two Web sites, entrepreneurship.gov and
entrepreneurship.org, we hope to provide a one-stop resource to
connect, inform, and give global entrepreneurs a voice in policymaking that
advances economic growth, supports the rule of law, and creates new
opportunities for U.S. exporters and for people throughout the world. (Read more about this effort.)
Public-private partnerships such as what we have with the Kauffman Foundation
and members of the business and academic communities are helping to provide the
tools and synergies needed to keep our nation on the leading edge of innovation
and entrepreneurship in the 21st century global economy.
