Technology Transfer Systems in the United States and Germany Lessons and Perspectives (1997) / Chapter Skim
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The German R&D Enterprise
The German R&D Enterprise
Pages 246-271
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From page 246... ...
. These include the institutes of the Max Planck Society, the Helmholtz Centers, the institutes of the Fraunhofer Society, and "other institutions" (the Blue List institutes and independent institutions established by the states, including the An-Institutes)
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TECHNOLOGY TRANSFER IN GERMANY FIGURE 3.1 Organization chart of the German R&D system. SOURCE: Schmoch et al.
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Federal ministries with important ties to departmental research institutes include the Ministry of Health, the Ministry of Agriculture, the Ministry of Transport (included in "Other Ministries" in Figure 3.1) , and the Ministry of Defense (BMVg)
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From page 249... ...
and public research institutes and universities perform some applied R&D. Nevertheless, it is important to know in which major areas the different institutions are working in order to understand relevant distributions of capital and manpower.
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The MPG and the Helmholtz Centers largely supplement the activities of universities in the areas of basic and long-term research. Among the public or semipublic institutions, the sector consisting of departmental research institutes is small compared to the Helmholtz Centers, the MPG, and the FhG.
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TECHNOLOGY TRANSFER IN GERMANY 251 Electrical energy Audiovisual technology Telecommunication Information technology Semiconductors Optics Control Medical engineering Organic chemistry Polymers Pharmaceuticals Biotechnology Materials Agriculture, food Basic materials chemistry Process engineering Surfaces Material processing Thermal processes Environment Machine tools Engines Mechanical elements Handling Agricultural machines Transport Nuclear engineering Weapons Consumer goods Civil engineering -100 -80 -60 -40 -20 0 20 40 60 8 0 100 Specialization index FIGURE 3.3 Specialization index of European Patent Office (EPO) patents of German origin in relation to the average distribution at the EPO for the period 1989 to 1991.
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. The closest correspondence to the German profile can be found in the fields of organic chemistry, polymers, and basic materials chemistry, which have above-average specialization indexes in both countries.
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TECHNOLOGY TRANSFER IN GERMANY 253 Electrical energy Audiovisual technology Telecommunication Information technology Semiconductors Optics Control Medical engineering Organic chemistry Polymers Pharmaceuticals Biotechnology Materials Agriculture, food Basic materials chemistry Process engineering Surfaces Material processing Thermal processes Environment Machine tools Engines Mechanical elements Handling Agricultural machines Transport Nuclear engineering Weapons Consumer goods Civil engineering -100 -80 -60 -40 -20 0 20 40 60 8 0 100 Specialization index FIGURE 3.4 Specialization index of European Patent Office (EPO) patents of U.S.
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From page 254... ...
Universities and research institutes again occupy a middle position. Although German SMEs appear to be drawing effectively on the technology transfer abilities of customers, suppliers, and consulting engineers, some observers believe that the capabilities of university polytechnical schools and research institutes are underutilized by SMEs.
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asked 1,349 German SMEs about the type and frequency of their contacts with universities and other research institutes during the past 5 years. The results of this study (Table 3.1)
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In this regard, they can draw upon the resources of a variety of R&Dperforming, transfer-oriented institutions such as Fraunhofer institutes and the research institutes of industrial research associations. (For details, see "Fraunhofer Society" and "Federation of Industrial Research Associations," below.)
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The 106 industrial research associations comprise an important subset of this larger group; they conduct cooperative research and are organized under the umbrella of the AiF.8 There are also about 400 associations for the advancement of science9 (Wissenschaftliche Fachgesellschaften) , representing more than 400,000 members from across the science disciplines.
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From page 258... ...
Although these early efforts did not meet expectations, it did demonstrate that there is a potential for NTBFs in Germany. The specific requirements of this type of start-up indicated a new strategy was needed, aiming at directly activating market forces by involving nonpublic investors (such as venture capital companies, private investors, companies, or banks)
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German law does not provide preferential tax treat ment of gains from venture-capital investment. However, analyses in the United States, Canada, and Great Britain show that high capital gains tax
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The German venture capital market is dominated by business investment companies (Kapitalbeteiligungsgesellschaften) of banks, savings banks, other credit institutions, and insurance companies, which are more interested in capital gains and invest little or no capital in NTBFs.
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The apparent risk-averse mentality of founders of German NTBFs can be connected directly to these legal restrictions. Two-thirds of American venture capital is administered by independent funds, one-fourth is handled by corporate venture capital firms, and the remaining portion is held by small business investment companies (SBICs)
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Venture capital and the underlying concept are not widely accepted by the German founders of NTBFs. Founders vehemently oppose equity stock capital and venture capital because the investors are accorded executive rights (Kulicke, 1993)
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From page 263... ...
These include: • allowing a tax reduction for investors' contributions to special funds and reducing the applicable capital gains tax rate; • strengthening the pan-European stock exchange for NTBFs; • teaching managerial skills in natural sciences and engineering schools; and • improving the competence of venture capital and equity stock companies to assess financial and technological risks and to deepen their knowledge of technology. To sum up, in Germany, NTBF formation is discouraged by an unfavorable financial, legal, and social environment.
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From page 264... ...
The latter established three focal areas for R&D: basic technologies, management of natural resources, and management of intellectual resources. These areas were in turn broken into six sections and a series of specific programs: • Information and communications technologies • Industrial and materials technologies • Environment • Life sciences and technologies • Energy • Human capital and mobility The Fourth Framework Program extended the specific programs within the existing sections and added another two sections, in transportation technologies and socioeconomic research; however, those two programs account for only 4 percent of the EU budget for research and technological development.
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• Technical and economic usefulness • Exploitation possibilities for the expected results However, the EU is currently redirecting its technology policy from precompetitive research toward market-oriented projects (Klodt, 1995)
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However, the allocation of those funds among different sectors of the R&D systems is uneven. EU funding for predominantly industrially oriented programs goes chiefly to German industry.
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, including • that there is inadequate representation of some research fields among those that gain EU support; • that there is excessive amount of bureaucracy involved in the application procedure and the management of the project (see, for example, Schmoch et al., 1996b) ; • that the dominant role of the English language can be a hindrance in the running of EU projects and in the work of transnational project consortia; and • that low rates of approval for project proposals waste resources if the application fee is high.
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There are no limitations to the size or scope of EUREKA projects. Although governments may play a role in setting standards and norms (e.g., in the environmental area)
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. The budget figures for EUREKA and EU programs are not directly comparable, since they relate to different periods of Other organizations 5% Research institutes 28% Large companies 43% SMEs 24% FIGURE 3.11 Involvement of EUREKA participants by major organization type, status as of 1995.
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A prerequisite for EUREKA projects is sound financing, which may come from either national or EU sources. In most cases, if German participants apply for public support, the BMBF will allocate them funds out of its programs.
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The digital audio broadcast project provided all the necessary components for planned field tests. Transmissions are in progress in 21 areas (10 more are planned)
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