Funds awarded through the federal Small Business Technology Transfer (STTR) program support technological innovation through cooperative R&D between small businesses and research institutions. This indicator represents the extent to which small business firms in a state attract federal support for cooperative R&D and technology transfer efforts.

Phase I awards support small business efforts to establish the technical merit, feasibility, and commercial potential of a proposed research effort. STTR Phase I awards normally do not exceed $150,000 total costs for 6 months. Phase II awards support businesses to further their R&D toward commercialization. Generally, only Phase I awardees are eligible for a Phase II award. STTR Phase II awards normally do not exceed $1,000,000 total costs for 2 years.

Because of year-to-year fluctuations, this indicator is calculated using 3-year moving averages. The 3-year average annual STTR award dollars won by small businesses in a state are divided by the 3-year average annual gross domestic product (GDP) for the same period. All data are expressed in current dollars.

The amount of STTR funding that states receive relative to the size of their economies varies greatly across states, with states in the highest quartile often measuring more than an order of magnitude greater than those in the lowest quartile. Total federal STTR award funding has remained relatively flat since the late 2000s; as GDP has increased, the value of this indicator has decreased nationally and for most states.

Data sources: Small Business Administration, Office of Technology, Small Business Technology Transfer program; U.S. Bureau of Economic Analysis, Gross Domestic Product data; Government of Puerto Rico, Office of the Governor, Gross Domestic Product data.

Science & Engineering State Indicators

Average Annual Federal Small Business Technology Transfer Funding per $1 Million of Gross Domestic Product

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Average Annual Federal Small Business Technology Transfer Funding per $1 Million of Gross Domestic Product