Economic Report of the President 1994 - The American Presidency ...

could register with the government and thereby limit their antitrustexposure to actual damages, rather than face the usual trebledamage penalty for antitrust violations. Legislation enacted in1993 extends these protections to production joint ventures, therebyremoving a barrier to collaborative efforts to implement newmanufacturing techniques and production processes. Because theseaspects of the production process can be understood as researchinto product commercialization, this extension serves a purposesimilar to that of the 1984 legislation.Development and Diffusion of Advanced ManufacturingTechnologyAnecdotal examples abound of technologies developed in theUnited States, such as numerically controlled machine tools, thatwere commercially exploited first or more successfully abroad.These anecdotes point to market failures other than imperfectappropriability that also contribute to insufficient adoption and utilizationof research results. For example, firms may face unnecessarilyhigh transactions costs for obtaining information, and firmswith good ideas but limited sources of collateral or internal financemay find themselves unable to raise funds in the capital markets.The effort to commercialize a new technology often presentsfirms with an array of organizational challenges: New manufacturingprocesses and distribution channels must be developed, workersmust be retrained, and new suppliers and perhaps even new customersmust be identified. In meeting these challenges, firms developa great deal of valuable information—from manufacturingknow-how to marketing insights—some of which cannot be protectedas intellectual property or trade secrets.On the other hand, firms sometimes have difficulty gaining accessto other types of technological know-how developed insideother companies and the ways different firms have met implementationchallenges. Adoption of advanced manufacturing technologyis typically a "systems" problem. Suppliers must be able to sellcomponents that fit into complex automated production systems.Buyers must be assured of compatibility among machines, robots,transfer lines, and the like, or they will not adopt the technology.To help remedy these market failures, and so promote morerapid and extensive commercialization and diffusion of importantnew technologies, the Administration is expanding NIST's ManufacturingExtension Partnership (MEP) program. ManufacturingTechnology Centers (MTCs) form the backbone of the program.MTCs offer impartial advice to small and medium-sized manufacturersfrom people with extensive industrial experience. This adviceis backed by hands-on technical assistance. MTCs will belinked among themselves to a set of smaller Manufacturing OutreachCenters (MOCs), geared to areas with smaller concentrations197