Toward a standard benefit-cost methodology for publicly funded science and technology programs

Abstract

The Advanced Technology Program (ATP) is a partnership between government and private industry to conduct high-risk research to develop enabling technologies that promise significant commercial payoffs and widespread benefits for the economy.Since the inception of ATP in 1990, ATP's Economic Assessment Office (EAO) has performed rigorous and multifaceted evaluations to assess the impact of the program and estimate the returns to the taxpayer. To evaluate whether the program is meeting its stated objectives, EAO employs statistical analyses and other methodological approaches to measure program effectiveness in terms of:• Inputs (program funding and staffing necessary to carry out the ATP mission)• Outputs (research outputs from ATP supported projects)• Outcomes (innovation in products, processes, and services from ATP supported projects)• Impacts (long term impacts on U.S. industry, society, and economy) Key features of ATP's evaluation program include:• Business Reporting System, a unique online survey of ATP project participants, that gathers regular data on indicators of business progress and future economic impact of ATP projects.• Special Surveys, including the Survey of Applicants and the Survey of Joint Ventures.• Status Reports, mini case studies that assess ATP projects on several years after project completion, and rate projects on a scale of zero to four stars to represent a range of project outcomes.• Benefit-cost analysis studies, which identify and quantify the private, public, and social returns and benefits from ATP projects • Economic and policy studies that assess the role and impact of the program in the U.S. innovation system EAO measures against ATP's mission. The findings from ATP surveys and reports demonstrate that ATP is meeting its mission:• Nine out of 10 organizations indicate that ATP funding accelerated their R&D cycle.• The existence of a "Halo Effect." As revealed by EAO surveys, shows that an ATP award establishes or enhances the expected value in the eyes of potential investors.• ATP stresses the importance of partnerships and collaborations in its projects. About 85 percent of project participants had collaborated with others in research on their ATP projects. AbstractThe author would like to thank ATP's many contractors for their inspiration and cooperation in developing economic studies of the program's impact. Their dedication to rigorous fact finding and fruitful benefit-cost analysis, despite the uncertainties and long time horizons faced in applying this tool to early-stage R&D projects, leaves a strong and continuing legacy. The author would like to acknowledge Lorel Wisniewski for asking for a comparison of ATP-funded studies that inspired this study and would also like to thank Stephanie Shipp and Connie Chang for their encouragement in pursuing it. Thanks are also due to Brian Belanger, Stephanie Shipp, and Lorel Wisniewski for their helpful review comments and to Harold Marshall, Building and Fire Research Laboratory, for his NIST ERB review. Acknowledgments Acknowl...

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