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Comments on S. 881 and GAO Report on Small-Business Innovation Initiatives

Published: Jul 15, 1981. Publicly Released: Jul 15, 1981.
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Highlights

Comments were presented on a GAO report on small business innovation and S. 881. The study of small business innovation addresses the conditions that GAO found necessary for small-business innovation to flourish. It is clear from the analysis that small businesses are important contributors to the innovation process in the United States. The GAO objective was to construct a comprehensive picture of small-business innovation. GAO focused the report on three questions: (1) what factors influence the environment within which small businesses innovate; (2) how do small businesses act as innovators within that environment; and (3) how can an understanding of the answers to these two questions contribute to Federal policymaking efforts to support small-business innovation. The bill, known as the Small Business Research Act of 1981, would allow for the creation of small-business innovation research programs in agencies with research or research and development (R&D) budgets in excess of $100 million and would establish goal-setting requirements for funding agreements for research or R&D to small businesses in agencies with R&D budgets in excess of $20 million. GAO is concerned that the bill lacks targeting and flexibility in the way it is to be funded. GAO would prefer that a funding mechanism different from the one proposed be used.

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