We discuss the matching conditions and renormalization group evolution of n
on-relativistic QCD. A variant of the conventional <(MS)over bar> scheme is
proposed in which a subtraction velocity nu is used rather than a subtract
ion scale mu. We derive a novel renormalization group equation in velocity
space which can be used to sum logarithms of v in the effective theory. We
apply our method to several examples. In particular we show that our formul
ation correctly reproduces the two-loop anomalous dimension of the heavy qu
ark production current near threshold.