National Economic Impacts of DOD Technology License Agreements with U.S. Industry, 2000-2021

This study estimated the economic contribution to the U.S. economy of Department of Defense license agreements in effect during the 2000-2021 period.

Its purpose was to determine the extent that these license agreements contributed to new economic activity and job creation in the United States, and resulted in the transition of new technology to U.S. military use.

The study surveyed 1,168 companies having license agreements with DOD during the 2000-2021 period. A total of 1,498 license agreements were involved because some companies had multiple agreements.

Companies were asked to divulge the total sales of new products and services directly related to their DOD license agreements. They also were asked about license-related sales to the U.S. military, either directly or through a defense contractor.

Of the 1,168 companies, 484 had generated sales of products or services through these licenses. In all, 590 licenses, representing 39 percent of the total, led to sales of products or services. Collectively, these sales were nearly $32.3 billion, including $5.05 billion to the U.S. military, either directly or through defense contractors.

The IMPLAN national model was used to estimate the total economic impacts related to the sales resulting from the DoD license agreements. Impacts analyzed included economic output, value added, employment, labor income, and tax revenues.

The total economy-wide impact, as measured by output, was estimated at $69 billion. Value added was estimated at $35.8 billion, representing new wealth creation in the economy. Employment impacts included 246,783 jobs with an average income of $84,643. Labor income was estimated at $20.9 billion. The $32.3 billion in sales and its economy-wide effects generated approximately $7 billion in federal, state, and local tax revenues.