Before 1980, the results of federal agricultural research were freely available and widely shared. Virtually all of the research was directed toward improving crop production and yields as well as harvesting and storage costs of crops intended for food and feed markets.

There are considerable uncertainties regarding cost-benefit analyses. Nevertheless, it is instructive that the many studies done both inside and outside the United States Department of Agriculture (USDA) found its pre — 1980 R&D efforts very effective and influential.

USDA economists found that publicly funded agricultural research earned an annual rate of return of at least 35 %.1 A 1966 study by the Agricultural Research Service (ARS) on the impact of its research from 1941 to 1966 concluded that 109 products and processes developed by ARS had been commercialized and 26 represented major contributions in basic research. Their value was estimated by the ARS at more than $6 billion, 20 times the $309 million spent by the ARS laboratories during this period.2

A 1980 study by the Congressional Office of Technology Assessment on the benefits stemming from agricultural research concluded that, "the range of estimated rates of return is from a low of 23 percent to a high of 100 percent."3 A 1992 study by Chapman and Associates (1) examined 178 cases of ARS research projects completed from 1980 to 1990 (including coopera­tive programs or joint programs with State Agricultural Experiment Sta­tions). Of the 178 cases, benefits data were identified for 87, resulting in $14.8 billion in sales or savings. These savings were greater than the total amount spent on the ARS during that time period (1).

Another study (2) found that although the ARS had a relatively small number of patents compared to the private sector in agricultural-related areas, the ARS patents were cited more often than private patents. Thus, the ARS patents were considered more often "key" patents marking significant advances in knowledge (2).

Despite these successes, in the late 1970s there was a growing and increasingly influential school of thought that a focus on more basic research and the nonexclusive sharing of the fruits of such research was not encouraging the levels of private investment sufficient to commercial­ize new technologies. Many potentially valuable scientific advances were therefore remaining in the laboratories. Commercialization would occur only if private investors could be guaranteed exclusive access to the knowl­edge generated from what would increasingly become investments in fed­eral research efforts made by both private and public sectors.

In rapid fashion, beginning in 1980, the federal government dramati­cally changed its R&D strategies to encourage one in which private inter­ests would become increasingly influential in directly assisting public research:

1. The University and Small Business Patent Procedure Act, commonly known as the Bayh-Dole Act of 1980, gave nonprofit organizations such as universities as well as small businesses the right to retain patents for technology developed with government funds.

2. The Stevenson-Wydler Technology Innovation Act of 1980 provided federal departments, agencies, and affiliated laboratories with a leg­islative mandate to pursue technology transfer activities. Each agency was to make available not less than 9.5% of its R&D budget for technology transfer activities.

3. In 1983, an Executive Order extended the coverage of the Bayh-Dole Act to all government contractors. The Act also granted federal agen­cies the right to offer exclusive or coexclusive licenses to patents on inventions made by laboratory employees considered necessary for the commercialization of the invention.

4. The Federal Technology Transfer Act of 1986 allowed federal labo­ratories to enter into Cooperative Research and Development Agree­ments (CRADAs) with private firms. A CRADA confers two important rights to businesses: First, the right of first refusal of an exclusive license on any patentable inventions that arise from the research partnership; and, second, the right to keep research find­ings secret for 5 yr. The Act also permitted royalty income from patent licensing and assignment to be distributed directly to the inventors. The 1986 Act also made technology transfer a responsibil­ity of every laboratory scientist and engineer. It required at least one full-time equivalent technology transfer position for every labora­tory having 200 or more full-time scientific, engineering and related positions.

Today much if not most federal research, including biomass-related research, is done in partnership with private companies that have the right to exclusively own the intellectual property generated from that collaboration.

How effective has the post-1980 approach been compared to its pre­decessor?

Unfortunately, there are few if any studies that adequately address this important question. Vast changes in agricultural technologies have occurred over the last 20 yr, especially in the area of biotechnology in crops and animals. Yet, in this area federal R&D spending may have played a modest role that largely followed the massive amounts of venture capital that flowed into the biotech sector.

Efforts to compare the pre — and post-1980 R&D strategies are con­founded by the fact that the metrics used to evaluate the performance of federal research have changed. In the older period, the measures used largely reflected the impact on the country and the countryside, such as the number of acres planted in the new hybrid and the rate of adoption of a new technology by farmers or processors. The new approach largely measures the impact on the agency or its private partner, considering factors such as the number of patents issued, the number of licenses issued, and the amount of royalties received.

It is now more than 20 yr since the federal government adopted a dramatically different approach to R&D by emphasizing technology trans­fer, private partnerships, and exclusive licensing. This is sufficient time to allow evaluation of the comparative effectiveness of both approaches.