** What policies encourage high-technology manufacturing?

We presented this paper at the ISSI conference in Istanbul in June, 2015, and got out before the bombing started.

Causal Connections Between Scientometric Indicators:
Which Ones Best Explain High-Technology Manufacturing Outputs?

R. D. Shelton ,T. R. Fadel, P. Foland
WTEC, 1653 Lititz Pike #417, Lancaster, PA 17601 (USA)

Scientometric models can connect indicators via cross-country correlations, but these are not enough to assert causality. Sometimes a causal connection can be argued from the physical process. In other cases the causality or its direction is not clear, and the Granger test is often used to clarify the connection. Here it was shown that gross expenditures on R&D (GERD) Granger caused scientific papers in the U.S., EU, and some others, which has policy implications. Granger causality also reinforces earlier findings on why the EU passed the U.S. in papers in the mid-1990s. Downstream, it is difficult to prove the connection between research and gross domestic product (GDP), since the contributions of science are diluted by other factors. New data allows a focus on a sector that is more closely associated with science: high technology (HT) manufacturing outputs. This value-added data permits more accurate models for today’s international supply chains. Correlations show that business expenditures on R&D (BERD) and scientific indicators like patents are closely connected with HT manufacturing outputs. However for BERD, either direction of causality is plausible, and enough countries had significant results to show that causality can indeed be in either direction. The connections between papers and patents with HT manufacturing were also investigated; in several countries patents could be said to have Granger caused HT manufacturing.

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