Chapter 6: Science & Engineering Indicators 93
The Global Markets for U.S. Technology
In the United States, two parallel developments--the growing import penetration of the U.S. domestic market and the recent large U.S. trade deficits--have drawn attention to the country's ability to compete in an increasingly international economy.
In particular, recent challenges to U.S. leadership in many high-technology product markets have led policymakers to examine the role of the Nation's S& T in supporting and restoring U.S. competitiveness in the global marketplace.
There are several reasons why high-tech industries are important to the U.S. economy.
- High-tech firms are associated with innovation. Firms that are innovative tend to gain market share, create new product markets, and/or use resources more productively. These characteristics have helped to make high-tech industries the fastest
growing industries in the United States (ITA 1993, p. 21, tables 3 and 4).
- High-tech firms are associated with high value-added manufacturing and success in foreign markets which helps to support higher compensation to the production workers they employ. (Click here for footnote 3.)
- Industrial R& D performed by high-tech industries has other "spillover" effects. These effects benefit other commercial sectors by generating new products and processes that can often lead to productivity gains, business expansions, and the
creation of high-wage jobs (Tyson 1992; ITA 1993; and Hadlock, Hecker, and Gannon 1991).
This section discusses U.S. "competitiveness," broadly defined here as the ability of U.S. firms to sell products in the international marketplace. The concept of a nation's global competitiveness incorporates both its ability to export and compete
against imports in the home market. The analysis in this section relies heavily on data compiled by the Organization for Economic Co-operation and Development (OECD) and the U.S. Department of Commerce
(DOC).
Throughout this section, industry-level data are presented for manufactured goods disaggregated by (1) those industries producing products that embody above average levels of R& D in their development (hereafter referred to as the high-technology industries
and consisting of the aircraft, office and computing equipment, communications equipment, drugs and medicines, scientific instruments, and electrical machinery industries) and
(2) all other manufacturing industries. 
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