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Rationales and Mechanisms for Revitalizing US Manufacturing R&D Strategies



Gregory C. Tassey


The race to economic superiority is increasingly occurring on a global scale. Competitors from different countries are employing new types of growth strategies in attempts to win that race. The United States cannot, therefore, continue to rely on outdated economic growth strategies, which include an inability to understand the complexity of the typical industrial technology and the synergies among tiers in high-tech supply chains. In this context, a detailed rationale is provided for maintaining a viable domestic technology-based manufacturing capability. In the United States, the still dominant neoclassical economic philosophy is at best ambivalent on the issue of whether a technology-based economy should attempt to remain competitive in manufacturing or let this sector continue to offshore in response to trends in comparative advantage, as revealed through shifts in relative prices. The paper argues that the neoclassical view is inaccurate and that a new innovation model is required to guide economic growth policy. Specifically, the paper provides (1) a rationale for why an advanced economy such as the United States needs a manufacturing sector; (2) examples of the process of deterioration of competitive positions for individual industries and, more important, entire high-tech supply chains; (3) an explanation of the inadequacy of current economic models for rationalizing needed new policy strategies; and (4) a new economic framework for determining both policy mechanisms and targets for those mechanisms, with emphasis on the systems nature of modern technologies and the consequent requirement for public–private innovation ecosystems to develop and deliver these technologies. Several targets are suggested for major policy mechanisms.
Journal Of Technology Transfer


innovation economics, economic growth policy, manufacturing, innovation policy models, policy mechanisms


Tassey, G. (2010), Rationales and Mechanisms for Revitalizing US Manufacturing R&D Strategies, Journal Of Technology Transfer, [online], (Accessed February 22, 2024)
Created January 29, 2010, Updated November 10, 2018