Industrial Innovation in Japan and the United States

Abstract

Japanese firms tend to be quicker and more economical than U.S.firms at developing and introducing new products and processes, but this advantage seems to exist only among innovations based on external technology, rather than internal technology. Whereas U.S.firms put more emphasis on marketing start-up, they put much less emphasis on tooling, equipment, and manufacturing facilities than do Japanese firms. Applied R&D in Japan, which focuses more on processes than in the United States, seems to have yielded a handsome return; but there is no evidence that the rate of return from basic research has been relatively high in Japan. In robotics, the Japanese edge seems to increase as one moves from R&D toward the market.