Graduation date: 2007The biorevolution in the 1970’s greatly stimulated investment in life-science research. The present dissertation is aimed at evaluating the impact of US public investment on industrial investment in life-science research. The focus is on three major life-science fields: biology, medicine, and agriculture. A dynamic model of industrial R&D investment is developed to identify the channels of influence which public R&D investment has on industrial R&D investment. The model takes into consideration four determinants of industrial R&D investment: market demand, technological opportunity, supply of scientific labor, and adjustment costs. The model is estimated using R&D expenditures and patent counts constructed at the individual life-science field level. Results show that, as far as the life sciences are concerned, the R&D performed by public institutions has been the primary cause of the past two decades’ surge in industrial R&D investment. Even after accounting for the negative wage effect, public institution R&D has been strongly complementary to industrial R&D, both in agriculture and in medicine. Public institutions’ basic biological research has had a significant “infrastructure” effect on industry’s agricultural and medical research. Although analysts typically have argued that market demand and technological opportunity are equally important determinants of the pace and direction of technological change, we find that, in the life sciences at least, the dominating stimulant to industrial R&D investment has been technology push, i.e., the creation of new technological opportunities when advances are made in public institutions’ research.