The future of the national laboratories

The end of the Cold War has called into question the activities of the national laboratories and, more generally, the level of support now given to federal intramural research in the United States. This paper seeks to analyze the potential role of the laboratories, with particular attention to the possibility, on the one hand, of integrating private technology development into the laboratory’s menu of activities and, on the other hand, of outsourcing traditional mission activities. We review the economic efficiency arguments for intramural research and the political conditions that are likely to constrain the activities of the laboratories, and analyze the early history of programs intended to promote new technology via cooperative agreements between the laboratories and private industry. Our analysis suggests that the laboratories are likely to shrink considerably in size, and that the federal government faces a significant problem in deciding how to organize a downsizing of the federal research establishment.

Evaluating the federal role in financing health-related research

This paper considers the appropriate role for government in the support of scientific and technological progress in health care; the information the federal government needs to make well-informed decisions about its role; and the ways that federal policy toward research and development should respond to scientific advances, technology trends, and changes in the political and social environment. The principal justification for government support of research rests upon economic characteristics that lead private markets to provide inappropriate levels of research support or to supply inappropriate quantities of the products that result from research. The federal government has two basic tools for dealing with these problems: direct subsidies for research and strengthened property rights that can increase the revenues that companies receive for the products that result from research. In the coming years, the delivery system for health care will continue to undergo dramatic changes, new research opportunities will emerge at a rapid pace, and the pressure to limit discretionary federal spending will intensify. These forces make it increasingly important to improve the measurement of the costs and benefits of research and to recognize the tradeoffs among alternative policies for promoting innovation in health care.