Sunday, May 03, 2009

National Energy Labs and DOE Investment

Soon, the Department of Energy will make some big bets on specific National Labs. They will receive a lot of $ to jumpstart "green tech". For an example of how this affects day to day life at these labs read Long Island's National Energy Lab . The urban economist in me would like to ask; 1. Per dollar invested, do National Labs generate significant new knowledge? Who owns this new knowledge? Is it open source? Do for profit firms locate near the Labs in order to learn about cutting edge new ideas, and to use the infrastructure (i.e Wind Tunnels) that these labs have to try out their energy efficiency ideas? Can you create an "economic agglomeration" (similar to a Silicon Valley or Wall Street) by subsidizing basic applied science?

A market test would be whether land prices are rising near these national labs that receive more DOE $. This would reveal that proximity to these labs is becoming more valuable.

The economist inside me would like to know whether private R&D on energy efficiency increases or decreases as National Lab activity increases? Crowding out issues versus strategic complementarities in efforts.

Finally, who are the scientists at the national Labs? What does the supply curve of excellent applied scientists look like? I thought that all the serious scholars are at UCLA! If the national labs have money but not much talent, will the "hydrogen economy" happen? I have no idea who is at the National Labs and I'm sure there are some very talented people but are they paid well enough to stay there?

Should science be done "in house" (at the national labs) or should the DOE have followed the National Science Foundation and had a peer review open to all University Scholars to apply for big pots of money?

2 comments :

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enviroecon said...

Good points there. I suppose it will have some effect, of course. The magnitude of the distortion in the market for brains (!) will depend on the size of the finance available and on how long will it go on. Is it just this year? A 10-year program?

I suppose part of this distortion could be offset if the knowledge produced is open source. But, then again, if you want to create an open source community, invest in connecting people from different locations, not in grouping them all together in a National Lab.