WASHINGTON - President of the Federal Reserve Ben Bernanke said Monday that the United States and other countries need to better understand the most effective ways to use the money from the Government for research and development projects.
"We know less that we would like that on the work of policy better", Bernanke said in remarks prepared for a Conference on innovation at Georgetown University.
Bernanke listed options: direct financial assistance to the institutions of research, grants to universities or researchers in the private sector, contracts for specific projects and tax incentives. But he offered no preference to which is best. He said depending on the type of project.
The Federal Government represents about 26 percent of total U.S. expenditures on research and development in 2008. It is down to about 50 percent in the previous three decades.
Bernanke also said support from the Government for research and development funding is more effective if it is considered as an investment in long-term economy.
LAG from basic research to commercial applications that can benefit the economy can be very long, he said. For example, the revolution of the Internet of the 1990s was based on scientific investment in the 1970s and 1980s.
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