2004
OECD Science, Technology and Industry Outlook Science and technology contribute to innovation and industrial performance as never before. What steps are countries taking to strengthen their capabilities in science, technology and innovation? How can they best collaborate with business to create, diffuse, and exploit knowledge in all sectors of an increasingly competitive, global economy? The OECD Science, Technology and Industry Outlook 2004 provides a comprehensive review of important trends and developments in science and innovation policy. It identifies key changes in science, technology and innovation policies in OECD countries and the factors driving them. Delving into themes at the centre of ongoing policy development, the present issue of this biennial publication examines the role of public/private partnerships in stimulating innovation, efforts to promote innovation in the service sector, global challenges related to the supply of human resources for science and technology, and the contributions of multinational enterprises to productivity growth and innovation. A statistical annex provides up-to-date statistics on R&D funding, patents, researchers and other indicators of innovative performance.
This book is available to subscribers to the following SourceOECD themes: Industry, Services and Trade Science and Information Technology Ask your librarian for more details of how to access OECD books online, or write to us at
[email protected] OECD Science, Technology and Industry Outlook
OECD Science, Technology and Industry Outlook
OECD's books, periodicals and statistical databases are now available via www.SourceOECD.org, our online library.
«
www.oecd.org
2004
ISBN 92-64-01689-9 92 2004 11 1 P
-:HSTCQE=UV[]^\:
2004
OECD Science, Technology and Industry Outlook 2004
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT Pursuant to Article 1 of the Convention signed in Paris on 14th December 1960, and which came into force on 30th September 1961, the Organisation for Economic Co-operation and Development (OECD) shall promote policies designed: – to achieve the highest sustainable economic growth and employment and a rising standard of living in member countries, while maintaining financial stability, and thus to contribute to the development of the world economy; – to contribute to sound economic expansion in member as well as non-member countries in the process of economic development; and – to contribute to the expansion of world trade on a multilateral, non-discriminatory basis in accordance with international obligations. The original member countries of the OECD are Austria, Belgium, Canada, Denmark, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States. The following countries became members subsequently through accession at the dates indicated hereafter: Japan (28th April 1964), Finland (28th January 1969), Australia (7th June 1971), New Zealand (29th May 1973), Mexico (18th May 1994), the Czech Republic (21st December 1995), Hungary (7th May 1996), Poland (22nd November 1996), Korea (12th December 1996) and the Slovak Republic (14th December 2000). The Commission of the European Communities takes part in the work of the OECD (Article 13 of the OECD Convention).
Publié en français sous le titre : Science, technologie et industrie : Perspectives de l’OCDE 2004
© OECD 2004 Permission to reproduce a portion of this work for non-commercial purposes or classroom use should be obtained through the Centre français d’exploitation du droit de copie (CFC), 20, rue des Grands-Augustins, 75006 Paris, France, tel. (33-1) 44 07 47 70, fax (33-1) 46 34 67 19, for every country except the United States. In the United States permission should be obtained through the Copyright Clearance Center, Customer Service, (508)750-8400, 222 Rosewood Drive, Danvers, MA 01923 USA, or CCC Online: www.copyright.com. All other applications for permission to reproduce or translate all or part of this book should be made to OECD Publications, 2, rue André-Pascal, 75775 Paris Cedex 16, France.
FOREWORD The OECD Science, Technology, and Industry Outlook 2004 is the fifth in a biennial series designed to provide regular overviews of trends, prospects and policy directions in science, technology and industry across the OECD area. In addition to synthesizing the latest available information on major policy developments, the report provides detailed analyses of key themes in science, technology and industry policy, with a particular emphasis on innovation. Special chapters examine the role of public/private partnerships in stimulating innovation, expanding efforts to promote innovation in the service sector, global challenges related to the supply of human resources for science and technology, and the contributions of multinational enterprises to productivity growth and innovation. Many of these themes were central to discussions held by Ministers in charge of science and technology policy at the January 2004 meeting of the OECD Committee for Scientific and Technological Policy (CSTP) at Ministerial level. The report has been prepared under the aegis of the CSTP. It incorporates contributions prepared by several members of the OECD Directorate for Science, Technology and Industry: Mario Cervantes, Jean Guinet, Byung-Seon Jeong, Jerry Sheehan, Shuji Tamura and Andrew Wyckoff. Jerry Sheehan served as the overall co-ordinator of the publication, Sandrine Kergroach-Connan provided statistical assistance and Philippe Marson provided secretarial support, all under the supervision of Daniel Malkin. The report benefited from substantive input and comments from delegates to the CSTP and its Working Party on Innovation and Technology Policy, as well as of numerous members of the Secretariat. The report is published on the responsibility of the Secretary-General of the OECD.
3
© OECD 2004
TABLE OF CONTENTS Executive Summary .............................................................................................................................................................
11
Chapter 1 Regaining Momentum in Science, Technology and Industry Introduction .......................................................................................................................................................................... A changing macroeconomic environment......................................................................................................................... Investments in science and technology............................................................................................................................ Capitalising on science and technology investments ..................................................................................................... Human resources for science and technology ................................................................................................................. Globalisation of science, technology and industry ......................................................................................................... Conclusion ............................................................................................................................................................................ Notes ..................................................................................................................................................................................... References ............................................................................................................................................................................
20 20 23 32 36 39 43 44 45
Chapter 2 Recent Developments in Science, Technology and Innovation Policies Introduction .......................................................................................................................................................................... Main directions for science, technology, and innovation policies ................................................................................ Strengthening public sector research and public research organisations ................................................................... Support for business R&D and innovation ....................................................................................................................... Enhancing collaboration and networking among innovating organisations ................................................................. Human resources for S&T.................................................................................................................................................... Evaluating innovation policies ........................................................................................................................................... Notes ..................................................................................................................................................................................... References ............................................................................................................................................................................
48 49 59 64 72 75 80 83 85
Chapter 3 Public/Private Partnerships for Innovation Introduction .......................................................................................................................................................................... 88 P/PPs for innovation: definition and typology.................................................................................................................. 88 The increased use of P/PPs for innovation........................................................................................................................ 92 Implementing efficient P/PPs: issues and good practices .............................................................................................. 94 Notes ..................................................................................................................................................................................... 105 References ............................................................................................................................................................................ 106
Chapter 4 Promoting Innovation in Services Introduction .......................................................................................................................................................................... 114 Services are of growing importance in OECD economies............................................................................................... 114
© OECD 2004
5
OECD Science, Technology and Industry Outlook 2004
Innovation in services ......................................................................................................................................................... Policies to promote innovation in services ...................................................................................................................... Conclusion ............................................................................................................................................................................ Notes ..................................................................................................................................................................................... References ............................................................................................................................................................................
122 136 140 141 142
Chapter 5 Ensuring the Supply of Human Resources in Science and Technology Introduction .......................................................................................................................................................................... Will supply meet demand? ................................................................................................................................................ Meeting demand through immigration............................................................................................................................. What can governments do to foster domestic development of HRST?........................................................................ Conclusion and outlook ...................................................................................................................................................... References ............................................................................................................................................................................
144 148 156 161 163 165
Chapter 6 Multinational Enterprises and Productivity Growth: Insight at the Firm Level Introduction .......................................................................................................................................................................... The changing role of MNEs in OECD economies............................................................................................................. Firm-level insight into the contribution of MNEs to productivity growth .................................................................... Conclusions and implications ............................................................................................................................................ Notes ..................................................................................................................................................................................... References ............................................................................................................................................................................
168 168 170 177 180 181
Statistical Annex Main OECD databases used............................................................................................................................................... Standard statistical notes used in this publication for science and technology indicators....................................... Standard industry aggregation by technology level ....................................................................................................... Annex tables .........................................................................................................................................................................
183 186 187 188
List of Tables
6
Chapter 1 1.1. Key economic variables........................................................................................................................................... 1.2. Examples of R&D spending targets in the OECD.................................................................................................
21 25
Chapter 2 2.1. Summary of national plans for science, technology and innovation policy in OECD countries .................... 2.2. Science and technology priorities in OECD countries......................................................................................... 2.3. R&D tax incentives in OECD countries, 2004 ........................................................................................................
51 58 66
Chapter 3 3.1. Major P/PP programmes in four countries ............................................................................................................ 3.2. Share of P/PPs in competitive funding of research in France ............................................................................. 3.3. P/PP objective and type of research ...................................................................................................................... 3.4. Selection process of the proposals for LTIs in the Netherlands ........................................................................ 3.5. Some selection criteria reflecting public interest and private benefit ............................................................. 3.6. Differences between science and technology communities .............................................................................. 3.7. Organisational models ............................................................................................................................................. 3.8. Share of SMEs in the financing of 13 French public/private research networks, 2001..................................... 3.9. Indicators for the evaluation of Dutch LTIs ........................................................................................................... 3.A.1.1. Comparative features of four P/PP programmes................................................................................................ 3.A.1.2. List of co-operative research centres (networks) currently operating, classified by technological field ..
91 92 95 96 96 98 99 101 103 107 110
© OECD 2004
Table of Contents
Chapter 5 5.1. National goals for human resources in science and technology ........................................................................ 147 5.2. US graduate student enrolment in science and engineering, 1992-2002 .......................................................... 156 Chapter 6 6.1. Labour productivity growth of US non-farm private businesses, by sector...................................................... 173 6.2. Labour productivity growth in US non-financial corporations, by sector and industry................................... 174 6.3. Differences in labour productivity in Belgium by type of firm ........................................................................... 174
Statistical Annex Tables 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35.
Breakdown of GDP per capita into its components, 1990-2003.......................................................................... Income and productivity levels in the OECD, 1950-2002 .................................................................................... Gross R&D expenditures, 1981-2003...................................................................................................................... GERD intensity, 1981-2003 ...................................................................................................................................... GERD by source of funds, 1981-2003 ..................................................................................................................... GERD by two main sources of funds, as a percentage of GDP, 1981-2003........................................................ R&D expenditures by sector of performance, 1981-2003 .................................................................................... GERD by sector of performance, 1981-2003.......................................................................................................... Business R&D expenditures, 1981-2003 ................................................................................................................ BERD intensity, 1981-2003....................................................................................................................................... Business R&D expenditures by source of funds, 1981-2003 ............................................................................... Business R&D expenditures, by two main sources of funds, 1981-2003 ........................................................... Intensity in business R&D expenditures by sector, 1991 and 2001 or nearest years available ..................... Business R&D expenditures by sector, 1991 and 2001 or nearest years available.......................................... R&D expenditures of affiliates under foreign control, 1991-2002....................................................................... Share of public R&D expenditures financed by industry, 1981-2003 ................................................................ Basic research expenditures, 1981-2003................................................................................................................ Basic research by performer, 1991-2003 ................................................................................................................ Government budget appropriations and outlays for R&D by socio-economic objectives, 1991-2003 ......... Tax treatment of R&D, 1990-2004 ........................................................................................................................... Total researchers per thousand employment, 1981-2002 ................................................................................... Researchers by sector of performance, 1991-2002 ............................................................................................... Human resources in science and technology, 1995-2002 .................................................................................... University graduates in science and engineering, 1988-2001 ............................................................................. "Triadic" patent families by priority year, 1991-2000........................................................................................... Number of "triadic" patent families by priority year, 1991-2000 ........................................................................ Science and engineering articles by country, 1988-2001..................................................................................... Portfolio of S&E articles by field, 1988-2001 ......................................................................................................... Technology balance of payments, 1981-2002 ....................................................................................................... Technology balance of payments, 1981-2002 ....................................................................................................... Share of value added in total gross value added, 1991-2001 ............................................................................. Trade-to-GDP ratio for goods and services, 1991-2003 ....................................................................................... Export ratio by industry and technology level, 1992-2002 .................................................................................. Import penetration by industry and technology level, 1992-2002 ..................................................................... Outward and inward foreign direct investment flows, 1990-2001.......................................................................
188 189 190 191 192 194 195 197 199 200 201 203 204 206 208 209 211 212 213 214 215 216 217 218 219 220 221 222 223 224 225 227 228 231 234
List of Figures Chapter 1 1.1. Technology balance of payments for OECD countries, 2002 .............................................................................. 1.2. Trends in R&D intensity, 1995-2003 ....................................................................................................................... 1.3. R&D intensity in OECD countries, 2002 ................................................................................................................. 1.4. R&D funding in public research organisations, 1998 and 2002........................................................................... 1.5. Business R&D as a share of GDP in major OECD regions ................................................................................... 1.6. Business R&D as a share of GDP in OECD countries, 1995 and 2002 ................................................................ 1.7. Government funding of business R&D, 1991 and 2002........................................................................................ 1.8. Scientific and engineering publications by country, 1991 and 2001 .................................................................. 1.9. Patent filings in the main patent offices ................................................................................................................
© OECD 2004
22 23 24 27 28 29 31 33 34
7
OECD Science, Technology and Industry Outlook 2004
1.10. 1.11. 1.12. 1.13. 1.14. 1.15. 1.16. 1.17.
8
Number of triadic patent families .......................................................................................................................... Business researchers per thousand employees in OECD countries, 1995 and 2002....................................... Growth in employment in HRST occupations, 1995-2002 ................................................................................... R&D intensity in non-OECD economies as a share of GDP ................................................................................ Regional and national shares of triadic patent families ...................................................................................... R&D investments by foreign affiliates, 1995-2001 ................................................................................................ Changes in R&D spending by foreign affiliates, 1994-2000................................................................................. Outward investment in R&D by US-owned firms .................................................................................................
35 37 38 39 40 41 42 42
Chapter 3 3.1. A typology of P/PPs................................................................................................................................................... 3.2. P/PPs for research and innovation: basic rationale .............................................................................................. 3.3. Expected benefits from a P/PP approach to innovation policy .......................................................................... 3.4. The eight selection rounds since the inception of the CRC programme (Australia) ....................................... 3.5. The WCFS organisational diagram..........................................................................................................................
90 93 93 95 99
Chapter 4 4.1. Share of the market services in total value added, 1980 and 2001.................................................................... 4.2. Contribution of market services to GDP growth, 1990-2001................................................................................ 4.3. Service-sector value-added embodied in manufacturing goods....................................................................... 4.4. Contribution of market services to job creation, 1990-2001 ............................................................................... 4.5. Breakdown of labour productivity growth by main industrial sector................................................................. 4.6. Expansion of knowledge-based market services, 1990-2001 or nearest available year ................................. 4.a. CIS3 respondents by sector and country .............................................................................................................. 4.b. CIS3 respondents by service sector and country ................................................................................................. 4.7. Innovative density in the service and the manufacturing sectors, 1998-2000 .................................................. 4.8. Average innovative density in the services and manufacturing sectors, 1998-2000........................................ 4.9. Innovative density by size class, 1998-2000.......................................................................................................... 4.10. Breakdown of small firms by sector, innovative versus non-innovative firms, 1998-2000 ................................ 4.11. Product and process innovation in service and manufacturing sectors, 1998-2000......................................... 4.12. Average intensity of business R&D expenditure (1995-2000) and innovative density (1998-2000), by sector .... 4.13. Share of innovative firms by activity, 2000............................................................................................................ 4.14. Growth of business R&D expenditures, 1990-2001 .............................................................................................. 4.15. Business R&D intensity in services and manufacturing, 1990 and 2001............................................................ 4.16. Growth of R&D intensity, services sector, 1990-2001........................................................................................... 4.17. Investment intensity in market services, 2001 ..................................................................................................... 4.18. ICT investment in OECD countries, 1980-2001 ..................................................................................................... 4.19. Software investment in OECD countries, 1980-2000 ............................................................................................ 4.20. Sources of information used by innovative firms in the service sector, 1998-2000 ......................................... 4.21. Share of employees with higher education in the service sector, 2000 ............................................................ 4.22. Concentration of highly skilled employees in the services, by industry, 2000 ................................................ 4.23. Factors impeding innovation in services and manufacturing ............................................................................. 4.24. Share of new firms in the population of innovative firms in manufacturing and services, 1998-2000 ........... 4.25. Innovative density of new and established firms in the service sector, 1998-2000......................................... 4.26. Public funding of manufacturing and service firms, 1998-2000...........................................................................
115 116 117 118 119 119 121 121 122 123 123 124 125 126 127 128 129 130 131 131 132 132 133 134 134 135 136 137
Chapter 5 5.1. Researchers per thousand in total employment, 2002........................................................................................ 5.2. Science and engineering degrees as percentage of new degrees, 2001........................................................... 5.3. Number of science and engineering graduates in G7 countries, 1998-2001..................................................... 5.4. Graduate rates at PhD levels, 2001 ........................................................................................................................ 5.5.a. Tertiary enrolment in science and engineering fields......................................................................................... 5.5.b. Average annual growth rate of new students, 1998-2002..................................................................................... 5.6. Number of US degrees awarded in science and engineering fields.................................................................. 5.7. Share of new students enrolled in computing, 1998-2002 .................................................................................. 5.8. Foreign PhD students as a percentage of total PhD enrolment, 2001 ............................................................... 5.9. Outward and return migration of Chinese students, 1991-2001 .........................................................................
145 150 151 151 152 153 155 157 158 159
Chapter 6 6.1. Contribution of foreign affiliates to turnover and employment in manufacturing, 2001 ................................. 6.2. Growth in turnover and employment foreign affiliates in manufacturing, 1995-2001...................................... 6.3. Contribution of foreign affiliates to turnover and employment in services, 2001............................................ 6.4. Share of foreign affiliates in manufacturing R&D.................................................................................................. 6.5. Relative productivity of foreign-controlled to domestically controlled plants................................................
169 170 171 172 176
© OECD 2004
Table of Contents
List of Boxes Chapter 1 1.1. The EU’s 3% target .................................................................................................................................................... 1.2. Business R&D in firms large and small ..................................................................................................................
25 30
Chapter 2 2.1. S&T policy in South Africa ....................................................................................................................................... 2.2. Forms of public support for business innovation ................................................................................................ 2.3. Support to business innovation in China .............................................................................................................. 2.4. HRST and S&T policy in Russia............................................................................................................................... 2.5. Immigration reform for ICT workers in Australia ...................................................................................................
53 64 71 75 79
Chapter 3 3.1. Stated objectives of two selected P/PP programmes .......................................................................................... 89 3.2. A special service unit to connect SMEs to a major P/PP – Kunstoffenhuis (Netherlands) .................................. 102 3.3. The measurement of additionality in the Austrian Kplus programme.............................................................. 104 Chapter 4 4.1. Interpreting the results of the CIS3 survey............................................................................................................ 120 4.2. Activities which contribute to innovation.............................................................................................................. 127 Chapter 5 5.1. Globalisation of R&D and outsourcing of science and technology employment............................................. 5.2. Interpreting enrolment data.................................................................................................................................... 5.3. Supply and demand for ICT workers...................................................................................................................... 5.4. Supply of science and technology graduates in non-OECD countries .............................................................. 5.5. Women in science and technology.........................................................................................................................
146 154 157 160 162
Chapter 6 6.1. Improving statistics on MNEs ................................................................................................................................. 178
9
© OECD 2004
EXECUTIVE SUMMARY Regaining momentum in science, technology and innovation As the recent economic slowdown gives way to prospects of stronger economic growth across the OECD region, renewed attention is being directed to ways of tapping into science, technology and innovation to achieve economic and societal objectives. The continued transition to more knowledge-based economies, coupled with growing competition from non-OECD countries, has increased the reliance of OECD countries on the creation, diffusion and exploitation of scientific and technological knowledge, as well as other intellectual assets, as a means of enhancing growth and productivity. High-technology industries account for a growing share of OECD-wide value added and international trade and can be expected to play a significant role in the economic recovery.
Science, technology and innovation are central to improved economic performance.
In recent years, weak economic conditions limited investments in science and technology. Global investments in R&D, for example, grew at a rate of less than 1% between 2001 and 2002, compared to 4.6% annually between 1994 and 2001. As a result, R&D spending slipped from 2.28% to 2.26% of GDP across the OECD, driven by declines in the United States, which was hard hit by the economic downturn. R&D intensity also declined in several Eastern European countries that are continuing to restructure their economies, but it increased in the EU25 as a whole, as well as in Japan and the AsiaPacific region.
Recent investments in science, technology and innovation have been constrained by slow economic growth.
Recognising the importance of innovation to economic growth and performance, most OECD governments aimed to shield public R&D investments from spending cutbacks and, in many cases, were able to increase them modestly. Although they remain far below levels of the early 1990s, OECD-wide government expenditures for R&D rose from 0.63% to 0.68% of GDP between 2000 and 2002 as budget appropriations grew, most notably in the United States, followed by Japan and the EU. Reflecting growing concerns about national security, much of the US increase related to defence R&D, although health-related R&D expenditures also increased.
Government R&D expenditures grew modestly…
Driving recent reductions in OECD-wide R&D intensity were steep cutbacks in R&D in the US business sector. Industry-financed R&D declined from 1.88% to 1.65% of GDP in the United States between 2000 and 2003, while R&D performed by the business sector declined from 2.04% to 1.81% of GDP. Japan, in contrast, saw a
... while business R&D spending declined, due to cut-backs in the United States.
© OECD 2004
11
OECD Science, Technology and Industry Outlook 2004
steep increase in business-performed R&D – from 2.12% to 2.32% of GDP between 2000 and 2002 – and modest gains were posted in the E U . Ve n t u r e c a p i t a l i n v e s t m e n t s a l s o pl u m m e t e d , f r o m USD 106 billion to USD 18 billion in the United States between 2000 and 2003, and from EUR 19.6 billion to EUR 9.8 billion in the EU between 2000 and 2002. While improved economic prospects promise a turn-around in business R&D and venture capital, rates of growth may be limited by lingering uncertainties about the pace of the recovery. Science and innovation are receiving greater policy attention...
Prospects of stronger economic growth across the OECD region provide new opportunities to enhance support for science, technology and innovation. Many OECD countries have introduced new or revised national plans for science, technology and innovation policy, and a growing number of countries have established targets for increased R&D spending. Virtually all countries are seeking ways to enhance the quality and efficiency of public research, stimulate business investments in R&D and strengthen linkages between the public and private sectors. Public/private partnerships (P/PPs) have emerged as a key element of innovation policy and are attracting a growing share of financing. Human resources for science and technology have also re-emerged as a primary concern among policy makers, especially as relates to the availability of sufficient supplies of skilled workers (including scientists and engineers) to sustain innovation-led economic growth and restructuring.
... but policy must adapt to the growing role of the service sector and increased globalisation of science and technology.
More so than before, science, technology and innovation policies need to adapt to the needs of the service sector and increased globalisation. Services account for a growing share of R&D in OECD countries – 23% of total business R&D in 2000 compared to 15% in 1991 – and the ability of service sector firms to innovate will greatly influence overall growth, productivity and employment patterns. Nevertheless, they remain less innovative than manufacturing firms overall. At the same time, science, technology and innovation are becoming increasingly global. The combined R&D expenditures of China, Israel and Russia were equivalent to 15% of those of OECD countries in 2001, up from 6.4% in 1995. Within many OECD countries, the share of R&D performed by foreign affiliates of multinational enterprises (MNEs) has also increased. Policy makers need to ensure that OECD economies remain strong in the face of growing competition and benefit from the expansion of MNE networks. Governments are strengthening science, technology and innovation systems
Government R&D budgets are poised to grow, especially for ICT, biotechnology and nanotechnology.
12
Despite financial constraints, many OECD governments are committed to increasing R&D spending. Several countries, as well as the European Union, have established explicit targets for boosting R&D expenditures, by both the public and private sectors. Public money is increasingly aimed at scientific and technological fields believed to have great economic and societal value, in particular, ICT, biotechnology and nanotechnology. Several countries, including © OECD 2004
Executive Summary
Denmark, Germany, the Netherlands and Norway have created special funds to finance research in priority fields. Governments have introduced a range of reforms to strengthen public research systems and to enable them to contribute more effectively and efficiently to innovation. The governments of Denmark, Japan and the Slovak Republic, for example, have increased the autonomy of universities or transformed them into private or quasi-private institutions and removed obstacles to their co-operation with industry. Funding structures have also been changed in many countries to make universities and government laboratories less dependent on institutional (i.e. block grant) funding and more reliant on competitively awarded project funds for research. Many countries have stepped up efforts to evaluate public research organisations, with a view toward improving the quality of teaching and research.
Reforms to public research organisations aim to improve their contributions to the economy and society...
Countries are also taking steps to improve technology transfer from public research organisations to industry. New legislation in Denmark and Norway makes technology transfer to industry an explicit mission of universities, and the new University of Luxembourg has been encouraged to stimulate industry interaction through contract research and mobility of students and researchers. Countries continue to reform rules governing the ownership of intellectual property (IP) generated by public research institutions, in most cases granting ownership of IP to the institution in order to facilitate its commercialisation. Norway and Switzerland introduced such changes in recent years, and Iceland and Finland are preparing legislation on the subject. Several countries that have not changed legislation, such as Australia and Ireland, have nevertheless developed new guidelines to encourage commercialisation of research results and provide greater consistency in IP management among research organisations.
... and to facilitate technology transfer to industry.
Support to business R&D remains a central feature of innovation policies across the OECD, especially as governments aim to boost business R&D spending. With the exception of several Eastern European countries, direct government support to business R&D has declined, both in absolute terms and as a share of business R&D, and greater emphasis is being placed on indirect measures, such as tax incentives for R&D. Between 2002 and 2004, Belgium, Ireland, and Norway established new tax incentive schemes, bringing to 18 the number of OECD countries employing tax incentives for R&D. The United Kingdom also developed a tax incentive for large firms, complementing their scheme for small ones. Countries are also making efforts to stimulate entrepreneurship and boost R&D activities in small and mediumsized enterprises (SMEs), such as by supporting venture capital and providing preferential support to SMEs.
Support to business R&D is becoming more indirect.
To measure the effectiveness of innovation policy and inform future policy development, nearly all OECD countries are placing greater emphasis on evaluation. Such evaluations take place at all
Innovation policy is more consistently subject to evaluation.
© OECD 2004
13
OECD Science, Technology and Industry Outlook 2004
levels: individual instruments (e.g. tax incentives, P/PPs), institutions (e.g. universities and government laboratories) and national innovation systems (e.g. Australia, Finland, United Kingdom). Canada plans to undertake a comprehensive assessment of federal support for R&D, and the Czech Republic regularly evaluates programmes as part of its policy development. Australia recently completed an assessment of its innovation system, as did Sweden. In some cases, such as in the Netherlands, New Zealand and Switzerland, all policies and programmes are required by law to be evaluated on a regular basis. Getting the most out of public/private partnerships
14
Public/private partnerships are essential to improving returns from public investments in research.
Public/private partnerships (P/PPs) are an essential instrument for fostering innovation in OECD countries. By entailing financial contributions from the public and private sectors, P/PPs provide a means of better leveraging limited public R&D funding and ensuring strong industry commitment. By linking public and private sector needs through shared objectives and active involvement of all partners in management and decision-making, P/PPs can also improve the quality of private sector contributions to public needs, enhance prospects for commercialising results of public research and improve basic knowledge infrastructures.
P/PPs account for a growing share of public R&D investment.
P/PPs account for a growing share of R&D funding in the OECD. In France, P/PPs accounted for 78% of all competitive research funding in 2002, up from 37% in 1998, and the Dutch government has reserved EUR 805 million for P/PPs in strategic areas between 2003 and 2010. Existing P/PP programmes in Australia, Austria and Sweden have also been reinforced with additional funding, and new P/PPs have been established in the Czech Republic, Ireland, Hungary and Switzerland. While many of these P/PPs take the form of join research centres, countries such as Belgium, Denmark, France, Netherlands, New Zealand, Switzerland and the United Kingdom are making efforts to establish networks between researchers in various research centres to improve co-ordination and quality of work.
Selection criteria and financing ratios should reflect the balance of public and private interest in the partnership.
Experience to date indicates that P/PPs must be carefully designed and managed so as to engage partners with different cultures, management practices and objectives. Success depends on how well P/PPs ensure industry commitment while balancing public and private objectives, fit into national innovation systems, optimise financing arrangements, create appropriate international linkages, engage SMEs, and are evaluated. For example, using a competitive, bottom-up approach to selection appears effective in ensuring that P/PPs attract capable firms and draw upon established competencies, but top-down criteria may also be needed so that P/PP programmes address areas of strategic importance for the country. The balance of financial contributions from the public and private sectors and the duration of public funding should also be adjusted to reflect the degree to which the research aims to fulfil government needs versus improving support to business R&D. © OECD 2004
Executive Summary
Although SMEs are essential to the success of many P/PPs, they have not been fully represented in many national programmes. France has seen some success, with SMEs accounting for almost 30% of the financing of 13 public/private research networks, compared to just over 20% of funding for all business R&D in the country. To encourage greater participation of SMEs, governments can take steps to lower entry barriers, such as by allowing participation of industry associations. They can also encourage formation of partnerships in fields where SMEs play a significant role. Policy can also have an influence on the participation of foreign firms, which can be important sources of talent and know-how but face numerous restrictions in many countries.
Greater participation by SMEs and foreign partners is further required for the success of P/PPs.
Stimulating innovation in the service sector Boosting innovation in the service sector is key to improving future economic performance. Services accounted for 70% of total value added in the OECD in 2000, with market services accounting for 50% of the total, up from 35% to 40% in 1980. Two-thirds of the increase in value added in OECD economies between 1990 and 2001 came from services, as did most employment growth. Services also accounted for the bulk of labour productivity growth in many OECD countries, including the United States, United Kingdom and Germany. The importance of services is likely to grow across the OECD as economies continue to become more knowledge-intensive and firms locate manufacturing in lower-cost regions of the world.
The service sector is a growing contributor to economic growth and employment.
Despite the long-held view of services as slow-changing, recent survey results illustrate great potential for innovation in service sector firms. The share of innovative firms in the service sector remains lower than that in manufacturing, but innovation rates in financial intermediation and business service firms (more than 50% and 60%, respectively) exceed the manufacturing average. Growth rates for R&D in services outpace those in manufacturing by a sizeable margin. While large service sector firms tend to be more innovative than smaller ones overall, small firms in the business services and financial intermediation sectors are more innovative than those in other service industries.
Service sector firms are innovative...
Innovation in services does not follow the same patterns as in manufacturing. Formal R&D plays a smaller role, and education and training are relatively more important. The share of service-sector employees with higher education is considerably higher than in manufacturing – twice as high in many OECD countries – with the largest concentration in the financial services sector. Reflecting their lower levels of R&D, services firms are more dependent on the acquisition of knowledge from external sources (e.g. via licensing of intellectual property and purchases of machinery and equipment), meaning that networking and supply chain considerations are paramount. Entrepreneurship also contributes to innovation, but the tendency of new service firms to be innovative is conditioned by the level of innovation in the economy as a whole.
... but innovation processes differ from those in manufacturing.
© OECD 2004
15
OECD Science, Technology and Industry Outlook 2004
Government policy needs to be tailored to specific needs of service sector innovation.
Boosting the innovation performance of service sector firms entails policies that better target and accommodate their needs. To date, service sector firms have only limited participation in government innovation programmes and are less likely than manufacturing firms to receive public funding. Despite the growing importance of service sector firms in OECD economies, few governments have developed innovation programmes specifically tailored to their needs. Greater efforts could be made, for example, to strengthen links between services firms and public research institutions, improve worker training, direct research to needs of particular service industries or help service firms make better use of ICT. Several countries, including Denmark, Finland, Ireland and Norway, are steps in these directions that could point the way to for other countries to follow. Ensuring sufficient supplies of human resources for S&T
16
Demand is growing for skilled scientists and engineers...
Efforts to increase innovative capacity and make economies more knowledge-based are fundamentally enabled by the availability of human resources for science and technology (HRST). Employment in HRST occupations grew approximately twice as fast as overall employment between 1995 and 2000, and the number of researchers across the OECD grew, from 2.3 million in 1990 to 3.4 million in 2000 – or from 5.6 to 6.5 researchers per 10 000 employees. Approximately two-thirds work in the business sector. Efforts to boost national and regional R&D spending will create additional demand for researchers. For example, the number of additional researchers needed to attain the EU’s objective of boosting R&D to 3% of GDP by 2010 could exceed a half million, by some estimates, raising questions about future supplies of S&T workers.
... but domestic supplies are uncertain in several countries.
Domestic supplies of scientists and engineers are highly unpredictable. While the overall number of tertiary-level science and engineering graduates grew in the EU, Japan and the United States, rates of growth have been modest and considerable variation exists across country, degree type and field of science or engineering. Between 1998 and 2001, the number of science graduates declined in Germany and Italy, while the number of engineering graduates declined in France, Germany, the United Kingdom and the United States. Tertiary-level enrolments in science and engineering appear to be growing faster than in all other fields combined, suggesting that longer-term supplies of HRST could increase if students complete their studies, but again patterns are mixed. Enrolments in US graduate science and engineering programmes grew from 405 000 to 455 000 students between 1998 and 2002, but Germany saw declines in physics and chemistry enrolments between 1993 and 2002. France reports declines in enrolments in first and second-level physics and biology programmes, but gains in PhD enrolments between 2001 and 2003. Well-functioning labour markets will be needed to ensure gainful employment of future graduates and avoiding skill shortages or mismatches. © OECD 2004
Executive Summary
Nations can supplement domestic supplies of HRST by tapping into international sources of scholars and highly skilled workers. International mobility has increased over the past decade as industry and education have become more global and as OECD countries have reformed immigration rules. Some 1.5 million foreign students were enrolled in higher education institutions in the OECD in 2000, about half of which originated in the OECD area, but migration patterns are changing. While the United States receives more foreign PhD-level students than other OECD countries, the number of foreign first-time PhD students and scholars declined slightly in recent years due to stricter immigration rules and growing competition from other OECD countries; numbers rose in the United Kingdom and Australia as they and other countries have implemented a number of new measures to attract foreign and expatriate workers. At the same time, growing numbers of students in non-OECD countries are receiving degrees in their home countries, and non-member governments are actively seeking to repatriate scholars and workers who have gained experience abroad.
Foreign workers can supplement supplies, but patterns of international migration are changing.
Ensuring adequate supplies of HRST will require efforts in a number of areas, many of which are being exploited by OECD countries. First, efforts are needed to attract more people into science and engineering careers by, for example, raising interest in and awareness of science especially among youth, improving teacher training and educational curricula, and recruiting more women and under-represented populations. Second, funding can be increased, especially for PhD students and post-doctoral researchers, who can often find more lucrative employment outside the research profession. Third, demand-side policies can be used to improve the match between supply and demand, such as by fostering mobility of young researchers, improving career prospects for public researchers, and providing better information to students about employment opportunities in the business sector. Efforts to increase business R&D will also create additional jobs in the business sector.
Governments need to take a broad-based approach.
Benefiting from globalisation Globalisation has been fuelled largely by the activities of foreign affiliates of large multinational enterprises (MNEs). Between 1995 and 2001, the share of manufacturing output and employment under foreign control rose in all OECD countries for which data is available, except Germany and the Netherlands. In 2001, the share of manufacturing R&D under the control of foreign affiliates in OECD countries ranged from 4% in Japan to more than 70% in Hungary and Ireland, with most countries falling between 15% and 45%. The share of employment in foreign affiliates ranged between 15% and 30% in most OECD countries. Growth in output from foreign affiliates grew more quickly than for domestic firms.
Foreign affiliates play a larger role in host economies.
The global reach of MNEs is expanding as non-OECD countries improve their scientific and technical capabilities. China, Israel, and Russia, among other countries, have made sizeable increases in
Non-member countries are more capable contributors to S&T.
© OECD 2004
17
OECD Science, Technology and Industry Outlook 2004
their R&D intensity in the last few years.* China’s R&D intensity doubled between 1996 and 2002 (from 0.6 to 1.2% of GDP) and its total R&D investments lag those of only the United States and Japan in absolute terms. Foreign R&D investments in China have grown rapidly as the nation’s technological capabilities have increased and its markets have become more open. US investments alone in China grew from USD 7 million to USD 500 million between 1994 and 2000.
18
MNEs contribute disproportionately to productivity and technology development.
Recent analysis based on firm-level data indicates that MNEs make sizeable contributions to productivity growth in their home and host countries and are important conduits for technology transfer. MNEs accounted for more of the growth in labour productivity in Belgium, the United Kingdom and the United States than uni-national or unaffiliated domestic firms; they also contributed to technological spill-overs that improve innovative performance in both home and host countries. Nearly all of the pickup in US non-financial corporate labour productivity in the late 1990s came from MNEs, and MNEs located in the United Kingdom also tended to out-perform domestic firms that were not part of a global network.
Policy should aim to capture the benefits of MNE activities, rather than limiting them.
While much attention focuses on the potential down-sides to globalisation – i.e. movement of domestic jobs to other countries, loss of control to foreign-owned MNEs – policy makers need to recognise the benefits to home and host countries and design policies to capture them. Policies designed to limit globalisation and repatriate foreign affiliates, for example, may not be effective means of strengthening domestic economies, as they will limit links to important sources of knowledge and productivity growth. Policy should focus on improving the attractiveness of the domestic economy to foreign affiliates and to ensuring spill-overs from their activities, such as by encouraging linkages with local firms and suppliers.
* China, Israel, the Russian Federation and South Africa are Observers to the OECD Committee for Scientific and Technological Policy.
© OECD 2004
Chapter 1
REGAINING MOMENTUM IN SCIENCE, TECHNOLOGY AND INDUSTRY
Economies worldwide have endured an economic slowdown from which they are only now beginning to recover and which has constrained the capacity of governments and industry to invest in science, technology and innovation. As OECD countries continue to move towards more knowledge-based economies and face increasing economic competition from non-member economies, their reliance on the creation, diffusion and exploitation of knowledge – including scientific and technical knowledge – will grow. This chapter examines recent science, technology and industry trends in the OECD area. It reviews performance according to a number of indicators – R&D expenditures, human resources, patents and trade – taking into account the increase in globalisation.
19
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction Recent years have been challenging ones for science, technology and industry. Science continues to advance the understanding of natural phenomena at scales large and small, technology continues to apply new knowledge to social and economic needs, and nations continue to shift to more knowledgebased economies. At the same time, economies worldwide have endured an economic slowdown from which they are only now beginning to recover and which has constrained the capacity of governments and industry to invest in science, technology and innovation. Growing concerns about safety and security have also had an impact on business and government, shifting patterns of demand and hence business profitability and adding to the range of objectives towards which government resources are directed. The result has been a reduction in the momentum that carried OECD countries’ investments in science, technology and innovation to the brink of the 21st century. Throughout the 1990s, and in particular in the second half of the decade, the business and government sectors of many OECD countries made sizeable increases in their investments in R&D and their uptake of information and communications technology (ICT). The subsequent economic downturn exerted pressure on such investments, and, while gains continue to be made in many part of the OECD, rates of growth have generally slowed. Of course, these forces were felt differently across the OECD, and the effects were more pronounced in some countries than in others, most notably in the United States. With an economic recovery now under way, the challenge to OECD countries is to regain their earlier momentum and to reconfirm their commitment to science, technology and innovation as a key driver of industrial performance and economic growth. This chapter examines recent science, technology and industry trends in the OECD area. It identifies factors in the economic environment that have shaped – and will continue to shape – investments in science, technology and innovation. It then reviews performance according to a number of indicators – R&D expenditures, human resources, patents and trade – taking into account the increase in globalisation. Where possible, the analysis focuses on trends in the past few years, using updated statistics to examine how national science, technology and innovation systems have responded to the economic slowdown and other disturbances. Also, an attempt is made, where possible, to identify future trends or forces that will affect them. As the chapter shows, the past few years have been unsettling, and the future remains uncertain, so that precise forecasts are not possible. Nevertheless, the general trends reveal a number of issues for policy makers to address. A changing macroeconomic environment
20
Trends in science, technology and industry have been shaped by the rapid changes in the economic environment during the past several years. Following a decade of economic expansion in the 1990s, OECD countries suffered a widespread economic slowdown in 2001 and 2002, from which they have just recently begun to emerge. OECD-wide economic growth slowed from an average pace of 2.7% a year between 1991 and 2000 to just 1% in 2001, with growth in the United States tumbling to 0.5%. Market corrections in the ICT sector, combined with rising energy prices, a contraction in international trade and growing concerns about international terrorism led to falling confidence and reduced economic growth rates in many industrialised countries, with high-technology sectors shouldering much of the burden. These changes had a significant effect on business-sector investments in science and technology, and in particular in ICT. © OECD 2004
Regaining Momentum in Science, Technology and Industry
Recovery in sight Current OECD projections foresee a strong and sustainable recovery buoyed by rising business investment, recovering corporate profits, a revival in high-technology sectors, and more resilient consumer spending. Overall OECD-area GDP growth is expected to climb from 2.2% in 2003 to 3.3% by 2005, and although job creation has picked up relatively slowly, unemployment is expected to decline from 7.1% to 6.7% of the labour force. Inflation is also expected to remain under control, although rising energy costs (driven by increased oil prices) remain a concern. Moreover, the recovery may proceed at different rates, with growth in the United States, the United Kingdom and Japan forging ahead of that in the euro area. The OECD projects average growth of 4.3% in the United States and 4.4% in Japan in 2004, compared to 2.0% in the euro area. Unemployment is also expected to drop to 5.2% or less of the workforce in the United States and Japan, compared to 8.5% in the euro area, potentially easing concerns about increased globalisation and outsourcing of jobs, particularly in the service sector. Government fiscal imbalances remain a possible cloud on the horizon, and one that could obscure other positive economic news. Public finances have deteriorated considerably in the largest OECD countries since the onset of the downturn, and deficits are projected to worsen in 2004 before recovering slightly in 2005 to 3.9% of GDP in the United States, 6.6% of GDP in Japan and 3.1% of GDP in the euro area. While Canada, Spain and a number of smaller OECD economies have managed to preserve fiscal surpluses, deficits in the larger economies put pressure on exchange rates and interest rates. In addition, they may further constrain government spending, including on science, technology and innovation.
Table 1.1. Key economic variables Average 1991-2000
2001
2002
2003
20041
20051
Real GDP growth2 United States Japan Euro area
2.7 3.3 1.5 2.4
1.0 0.5 0.4 1.7
1.7 2.2 –0.3 0.9
2.2 3.1 2.7 0.5
3.5 4.3 4.4 2.0
3.3 3.7 2.8 2.4
Unemployment3 United States Japan Euro area
6.9 5.6 3.3 9.6
6.4 4.8 5.0 8.0
6.9 5.8 5.4 8.4
7.1 6.0 5.3 8.8
6.9 5.5 5.0 8.8
6.7 5.2 4.6 8.5
Inflation4 United States Japan Euro area
3.8 – – –
2.9 2.4 –1.5 2.4
2.5 1.5 –1.2 2.6
2.0 1.7 –2.5 2.0
1.7 1.7 –1.8 1.7
1.6 1.6 –1.1 1.7
Fiscal balance5
–2.8
–1.1
–2.9
–3.7
–3.6
–3.1
1. Projected. 2004 GDP figures reflect updated OECD estimates as of September 2004. 2. Year-on-year increase. 3. Per cent of labour force. 4. GDP deflator; year-on-year increase. 5. Per cent of GDP. Source: OECD, Economic Outlook, 2004.
An innovation-led recovery? Science, technology and innovation promise to be a significant part of the economic recovery. As OECD countries continue to move towards more knowledge-based economies and face increasing economic competition from non-member economies, their reliance on the creation, diffusion and exploitation of knowledge – including scientific and technical knowledge – will grow. Already science, technology and innovation are key elements of economic success. In 2000 high- and medium-high© OECD 2004
21
OECD Science, Technology and Industry Outlook 2004
technology manufactures accounted for 8.4% of total gross value added in the OECD area, and knowledge-intensive market services accounted for an additional 19%.1 When education and health are added, technology- and knowledge-based industries accounted for 38% of total OECD-area value added in 2000. Value added in these sectors is growing rapidly. In the United States and Japan, for example, value added in high- and medium-high-technology manufacturing industries increased by 46% and 22%, respectively, between 1995 and 2001. Among the larger European economies, value added in these sectors grew by roughly 10% in Germany and Italy, 15% in the United Kingdom and more than 37% in France. Similarly, growth in knowledge-based market services has been rapid. The United States saw gains of 44%, and Japan of 33% between 1995 and 2001. In Europe, value added increased at a rate of 24% in France, 36% in Italy, 40% in Germany and 56% in the United Kingdom. Knowledge-intensive industries are increasingly important in international trade. High- and medium-high technology industries accounted for 67% of exports and 64% of manufacturing trade among OECD countries in 2001, up from 60% in 1995.2 Growth rates in the last half of the 1990s were highest in the most R&D-intensive sectors – office, accounting and computing machinery; pharmaceuticals; and aircraft and spacecraft – each of which grew at a rate of 10% or more. Furthermore, most OECD countries improved their technology balance of payments during the 1990s.3 While the deficit expanded for the EU as a whole, the surpluses of the US and Japan grew at a faster rate. Moreover, by 2001 12 of the 22 countries reporting such data indicated a positive trade balance, compared with just five countries in 1990 (Figure 1.1). R&D is essential to knowledge-intensive industries. In 1999 (the latest year for which comparable data are available), high- and medium-high-technology industries accounted for 69% of total OECD
Figure 1.1. Technology balance of payments for OECD countries, 2002 As a percentage of GDP United Kingdom (2001) Denmark (1999) Belgium (2001) Sweden (1993) United States Finland Japan (2001) Norway Canada (2001) Switzerland France (2001) Netherlands (1992) New Zealand (1999) Austria (2000) Italy Australia (1998) Slovak Republic (2001) Mexico Spain (1998) Poland (2001) Portugal Czech Republic Hungary (1999) Germany -0.3
22
-0.2
0
0.2
0.3
0.5
0.6 %
Source: OECD Technology Balance of Payments database, June 2004.
© OECD 2004
Regaining Momentum in Science, Technology and Industry
business R&D expenditure. Even though the service sector is not often thought of as R&D-intensive, it accounted for 21%, up from 14% in 1991. Most of this R&D occurs in knowledge-intensive sectors such as computing, communications and R&D services. To be sure, the R&D intensity of services is far below that of manufacturing, but in the computing services sector, for example, R&D is on average 4% of value added, a share above that of many medium- and low-technology manufacturing sectors. Recent innovation surveys indicate that the service sector is only slightly less innovative on average than manufacturing, and some service sector industries are more innovative than the average manufacturing sector (see Chapter 4 for a more detailed discussion of R&D and innovation in services). Such considerations highlight the importance of investigating trends in the creation, diffusion and exploitation of knowledge; these are, in particular, the primary objective of investments in R&D. Both government and industry investments are of interest, as they play different roles in the innovation system, financing and performing different types of R&D with somewhat different motivations. Investments in science and technology Investments in R&D have been strongly influenced by world events. In the wake of weak economic conditions after 2001, growth in OECD-wide spending on R&D slowed in 2002, increasing by less than 1% in constant prices, compared to average annual growth rates of 4.6% between 1994 and 2001. In relative terms, R&D spending declined from 2.28% to 2.26% of GDP between 2001 and 2002, owing to significant cutbacks in the more R&D-intensive sectors of the economy, most notably ICT manufacturing and related services (Figure 1.2). Most of the slowdown was due to declining R&D expenditures in the United States, where it dropped in real terms for the first time since 1993-94, slipping marginally from USD 246 billion to USD 245 billion, or from 2.74% to 2.67% of GDP. US R&D spending more than regained its losses in real terms in 2003, climbing to USD 248 billion in constant prices, but it continued to decline as a share of GDP. R&D spending in the European Union and Japan, in contrast, continued to climb during this period. R&D intensity increased in many OECD countries between 1995 and 2002, although the gap between the most R&D-intensive and least R&D-intensive countries widened (Figure 1.3). Sweden,
Figure 1.2. Trends in R&D intensity, 1995-2003 GERD as a percentage of GDP Japan
United States
OECD
EU25
3.5
3.0
2.5
2.0
1.5
1.0 1996
1997
GERD = Gross domestic expenditure on R&D. Source: OECD, MSTI database, June 2004.
© OECD 2004
1998
1999
2000
2001
2002
2003
23
OECD Science, Technology and Industry Outlook 2004
Figure 1.3. R&D intensity in OECD countries, 2002 GERD as a percentage of GDP % 4.5
2002
1995
4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5
Sw ed Fin en 2 lan Ja d p Ic an ela Un n ite Ko d d r Sw Sta ea itz tes er 1 De land n 2 Ge ma r To rma k ta ny 1 lO EC Fr D Be anc lg e iu Au m 2 st ria 1 N Un eth EU ite erl 15 d an Ki ds ng 2 d Ca om na da 1 Lu xe EU m 25 bo u No rg 3 Cz Au rwa ec st y h ra Ne Rep lia 4 w ub Ze lic ala Ire nd 2 lan d2 Ita ly Sp 2 Hu ain n Po gary rtu Gr gal ee Tu ce 2 r Sl ov P key 3 ak ol Re an pu d M blic ex ico 2
0
1. 2003. 2. 2001. 3. 2000. 4. 1996 instead of 1995. Source: OECD MSTI database, June 2004.
Finland and Iceland saw the most sizeable changes in R&D intensity, with each country posting more than a full percentage point increase between 1995 and 2002. All three countries, along with Japan, had high R&D intensities already in 1995, and they climbed above 3.0% in 2002. Among the larger European economies, growth rates were considerably slower, and several countries, including France, the Netherlands and the United Kingdom, saw declining levels of R&D intensity. Eastern European economies showed mixed trends, with R&D intensity increasing in the Czech Republic, Hungary and Turkey, but declining in Poland and the Slovak Republic. Hence, while OECD average improved somewhat (from 2.1% to 2.3% of GDP) the gap between the country with the highest R&D intensity (Sweden) and the lowest R&D intensity (Mexico) increased from 3.1 to 3.9 percentage points. Growing commitment to R&D
24
Despite weakening R&D investments, a number of OECD countries and non-member economies have strengthened their commitment to R&D. An increasing number of national and regional governments have established explicit targets for levels of R&D spending, often with the goal of increasing gross expenditures on R&D (GERD) to a specified level of GDP (i.e. R&D intensity) by a specified year, or of achieving a specific ranking among OECD countries in terms of R&D intensity. As of 2003, Austria, Canada, Finland, Germany, Hungary Japan, Norway, Spain and the European Union had set specific R&D spending targets (Table 1.2). The EU’s target (see Box 1.1), along with those of Austria, Germany and Spain, is linked to an absolute measure of R&D intensity; those of Canada, Norway and Hungary are based on a relative ranking of R&D intensity among OECD countries; Korea’s is linked to government R&D expenditures measured as a share of total government expenditure. Many of these targets are inspired by the experience of Finland, the United States and to a lesser degree Ireland, countries whose economic performance in the 1990s appeared to be innovation-driven and which succeeded in rapidly increasing their R&D intensity. © OECD 2004
Regaining Momentum in Science, Technology and Industry
Table 1.2. Examples of R&D spending targets in the OECD Country/region
R&D intensity in 2002
R&D target
Target date
1.93% 1.91% 1.83% 2.52% 1.02% 1.40% 2.91% 0.39% 1.67% 0.66% 1.03% 1.88%
2.5% of GDP Top 5 in OECD 3.0% of GDP 3.0% of GDP OECD average 2.5% of GNP Double national investment in R&D 1.0% of GDP At least OECD average 1.5% of GDP 1.4% of GDP 2.5% of GDP
2006 2010 2010 2010 2006 2010 2007 2006 2005 2006 2007 2014
Austria Canada European Union-25 Germany Hungary Ireland1 Korea Mexico2 Norway Poland Spain United Kingdom
1. Figures for Ireland are expressed as in terms of gross national product, instead of gross domestic product, consistent with its national reporting scheme. 2. R&D intensity for 2001. Source: OECD (2002) and OECD MSTI database, June 2004.
R&D spending targets reflect a growing recognition of the linkages among R&D, innovation and economic growth and more widespread efforts to use science and technology policy (e.g. R&D funding policy) to meet economic objectives. Such targets provide tangible goals for S&T policy and regard R&D funding as an input to an innovation process that will improve economic performance, boost productivity and result in increased wages and standards of living. Meeting such targets can, however, require significant reforms, as R&D intensity is strongly influenced by the industrial structure (i.e. by the relative size of R&D-intensive sectors) and by the relative attractiveness of a country as a location for
Box 1.1. The EU’s 3% target At the March 2002 meeting of the European Council in Barcelona, European Ministers announced a goal of “… turning the EU into the most competitive knowledge-based economy in the world”. One identified objective for achieving this status is to raise spending on R&D and innovation in the EU from its 2002 level of 1.9% of GDP (a figure that declines to 1.8% if new members are included) so that it approaches 3% by 2010. Approximately two-thirds of the increased R&D spending is to come from the private sector (European Commission, 2002, p. 20). The objective is not for each member country to raise its R&D intensity to 3% of GDP, but to achieve that target as a region. The target is intended to close R&D spending gaps between the EU, Japan and the United States, which widened noticeably during the 1990s after closing somewhat in previous years. While the EU, the United States and Japan all saw declining levels of R&D spending as a share of GDP in the early 1990s, R&D intensity climbed rapidly in the United States and Japan during the latter half of the decade but remained essentially flat in the EU. Between 1994 and 2000, US R&D intensity climbed from 2.4% to 2.7% and Japan’s increased from 2.7% to 3.0%; R&D intensity in the EU15 rose only from 1.8% to 1.9% of GDP. The gap in R&D spending derives almost entirely from differences in business-performed R&D, and most of that difference results from a widening gap in industry-financed R&D. In 1983, the overall R&D financing gap of 0.85 percentage points of GDP was divided evenly between shortfalls in industry- and government-financed R&D. By 2000, the gap in government-financed R&D had declined to just 0.1 percentage points of GDP, while that for industry-financed R&D had widened to more than 0.8 percentage points. Hence, the EU target aims to boost industry financing of R&D, while government financing is expected to increase at a much slower rate. Source: Sheehan and Wyckoff (2003). 25
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
R&D. The latter is influenced, in turn, by a range of conditions, including the quality of the public science base and the education system, the size and sophistication of local markets, and support for entrepreneurship. In fact, achieving high levels of R&D can require structural and regulatory changes that go well beyond what an apparently straightforward financial goal would seem to require (Sheehan and Wyckoff, 2003). The renewed commitment of OECD governments to R&D has led to a moderate increase in government-financed R&D in recent years. Between 2000 and 2002, government-financed R&D in the OECD area increased from 0.63% to a projected 0.68% of GDP. This figure remains significantly below its levels of 0.79% and 0.71% of GDP in 1991 and 1995, respectively, and reflects changing patterns of government funding of R&D, in particular for defence. Interestingly, recent growth has not been driven by the EU, despite its R&D spending target and the strong commitment of many EU countries to R&D. Between 1998 and 2001, government-financed R&D remained flat in the EU25 at 0.63% of GDP, as large EU economies reduced defence spending and faced other constraints on government spending. Most of the growth in OECD-wide government R&D financing (as a share of GDP) has resulted from increases in the United States (where it grew from 0.71% to 0.81% of GDP between 1998 and 2002), as well as in Canada (from 0.54% to 0.64%) and Korea (from 0.66% to 0.74%). Public research organisations are better financed Growth in government-financed R&D has been a boon to the public research sector in recent years. OECD-wide funding for R&D performed in the higher education sector (HERD) rose to 0.41% of GDP in 2002, compared to 0.37% in 1998 (Figure 1.4). Much of this growth was fuelled by an 11% increase in real spending between 2000 and 2002, from USD 94 billion to USD 104 billion. Roughly half of this increase came from gains in the United States, where funding rose from USD 33 billion in 2000 to USD 39 billion in 2002, and is projected to have increased further to USD 41.6 billion in 2003. Gains in France, Germany, Spain and the United Kingdom totalled more than USD 2.1 billion. Most other countries, except for Japan and the Netherlands, also saw real increases in HERD funding, which stood at USD 104 billion in 2002. Spending on R&D performed by government laboratories also took a positive turn after 2000. While spending levels generally declined between 1991 and 2000, from 0.28% to 0.23% of GDP, they saw modest increases in recent years, rising to 0.25% of GDP in 2002. Total funding increased from USD 57 billion in 2000 to USD 63 billion in 2002. Much of the recent increase has been fuelled by the United States, where government-performed R&D (GOVERD) grew from USD 17 billion in 2000 to almost USD 22 billion in 2002. Funding gains in the EU totalled just over USD 500 million during this time period – just ahead of those in Korea – while funding levels remained almost flat in Japan. Growing defence spending appears to be a primary driver of increases in government R&D. The largest increases in government-performed R&D occurred in the United States, and the share of government R&D spending allocated to defence grew from 50.5% in 2001 to a projected 55.1% in 2004, reversing the trend of the 1990s when the share of defence spending declined sharply. Shares of defence in government R&D funding also increased in France, Norway, Spain, Sweden (from 7.1% in 2000 to 22.2% in 2003), and, to a lesser extent, the United Kingdom, although they continued to decline in Korea and remain low in Japan (at 4.5% of total government R&D).
26
Despite increased funding for government research laboratories, the gap between R&D performed in the government sector and in the higher education sector continues to widen. Whereas they accounted for approximately the same share of national R&D expenditures in 1981 (between 15% and 16%), universities accounted for 18% in 2002 but government laboratories for only 11%. This is indicative of changing government priorities for R&D (e.g. a move away from defence and towards general knowledge-creation) and changing perceptions of the role of universities and government laboratories in national innovation systems. The former are seen as contributing to social and economic objectives more than was the case a decade or more ago. © OECD 2004
Regaining Momentum in Science, Technology and Industry
Figure 1.4. R&D funding in public research organisations, 1998 and 2002 Higher education R&D as a percentage of GDP Government R&D as a percentage of GDP 1998 0.83
0.8 %
Sweden (2001) Finland (2002) Canada Switzerland (2000) Denmark (2002) Netherlands (2001) Iceland (2002) Norway (2002) United States France (2002) Germany Japan (2002) Belgium (2001) United Kingdom (2002) Australia (2000) Total OECD (2002) EU15 (2001) Turkey (2000) EU25 (2001) Italy (2001) New Zealand (2001) Portugal (2002) Spain (2002) Korea (2002) Greece (2001) Hungary (2002) Ireland (2001) Czech Rep. (2002) Poland (2002) Mexico (2001) Slovak Rep. (2002) Luxembourg (2000) Austria 0.6
0.4
0.2
Iceland (2002) New Zealand (2001) Korea (2002) France (2002) Finland (2002) Germany Australia (2000) Hungary (2002) Japan (2002) Czech Rep. (2002) Netherlands (2002) Norway (2002) Poland (2002) Total OECD (2002) EU15 (2002) EU25 (2002) United States Canada Italy Denmark (2002) Portugal (2002) United Kingdom (2002) Spain (2002) Mexico (2001) Slovak Rep. (2002) Greece (2001) Belgium (2001) Sweden (2001) Luxembourg (2000) Ireland (2002) Turkey (2000) Switzerland (2002) Austria
0
0
0.2
0.4
0.6
0.8 %
Source: OECD MSTI database, June 2004.
Slowdown in business-sector R&D driven by United States Reductions in industry financing account for most of the slowdown in global R&D spending, but regional differences are significant. Across the OECD, R&D financed by industry declined from a peak of 1.45% of GDP in 2001 to 1.41% in 2002, and R&D performed by the business sector (BERD) declined from 1.58% to 1.54% of GDP (Figure 1.5). These declines come after a period of increasing business-sector R&D stretching back to 1994, but they are driven primarily by trends in North America. Industry-financed R&D declined precipitously in the United States between 2000 and 2003, from 1.88% to 1.65% of GDP, in response to the weak economic situation. Similarly, R&D performed by the US business sector also declined between 2000 and 2003, dropping by 6.6% in real terms from USD 183 billion to USD 171 billion, or from 2.04% to 1.81% of GDP. Owing to the close links between the US and Canadian economies, Canadian BERD also declined significantly, from 1.15% to 1.01% of GDP between 2000 and 2003. In contrast, Asia-Pacific and Europe enjoyed continued growth in business-sector R&D. Industryfinanced R&D increased rapidly in Japan, from 2.17% to 2.31% of GDP between 2000 and 2002, with © OECD 2004
27
OECD Science, Technology and Industry Outlook 2004
Figure 1.5. Business R&D as a share of GDP in major OECD regions Japan
United States
Total OECD
EU15
EU25
2.50 2.25 2.00 1.75 1.50 1.25 1.00 0.75 0.50 1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Source: OECD, MSTI database, June 2004.
BERD rising from 2.12% to 2.32% of GDP. In Korea, industry-financed and business-performed R&D declined marginally as a share of GDP between 2001 and 2002, but real spending grew, continuing the expansion that began at the end of the financial crisis in 1998. In Europe, the economic slowdown appears to have had only a marginal effect on business R&D. While BERD was flat during the mid-1990s in the block of countries that now comprise the EU25, it has seen steady growth since 1998, rising from 1.08% to 1.17% of GDP in 2002. Spending patterns in individual EU countries have been highly heterogeneous, with strong growth in Belgium, Denmark, Finland, Germany, Iceland, and, to a lesser extent, Spain and the United Kingdom, and relative stagnation in France, Italy and the Netherlands (Figure 1.6). Nevertheless, a persistent gap remains between business R&D intensity in the EU and that in Japan and the United States. Recent industry surveys indicate that US trends are likely to persist in the near term, at least until the economy recovers more fully. In the most recent annual survey of its members, for example, the USbased Industrial Research Institute (IRI) found that more companies planned to reduce than to increase their R&D spending in 2004 (IRI, 2003). While the number of companies planning to increase R&D funding rose between the 2003 and 2004 surveys, the number of companies planning reductions grew even faster. Moreover, a larger number of firms reported plans to cut their targeted ratio of R&D spending to sales, implying that R&D spending will drop faster than sales revenues. These findings are supported by the funding forecast prepared by Battelle and R&D Magazine, which anticipates a 0.5% decline in US industry R&D spending in 2004 when adjusted for inflation (Duga and Studt, 2004). In spite of improving economic prospects, R&D managers may be reluctant to hire new staff and firms may prefer instead to reap the benefits of continued improvements in productivity. Increased movement of R&D work to offshore locations may further slow R&D growth in the United States.
28
Future patterns of business R&D investment in Europe are harder to predict and will be influenced by conditions in individual countries. A recent survey by the European Roundtable of Industrialists (ERT) indicates that member companies (42 of the largest firms in Europe) plan to increase their R&D expenditures in future years, which could have a significant effect on overall levels of R&D spending (Box 1.2). Many of these firms report, however, that the bulk of that increase will likely be spent outside Europe; almost 40% of the R&D financed by these firms already takes place outside Europe (ERT, 2003). These results suggest that business R&D intensity will not rise rapidly in the EU unless there is a change in business perceptions of the attractiveness of Europe for sourcing and exploiting knowledge. © OECD 2004
Regaining Momentum in Science, Technology and Industry
Figure 1.6. Business R&D as a share of GDP in OECD countries, 1995 and 2002 % 3.5
2002
1995
3.0 2.5 2.0 1.5 1.0 0.5
Sw ed Fin en 2 lan Ja d p Sw K an o Un itze rea ite rla d nd 3 St a Ic tes 1 e De land n 1 Ge ma rm rk a Lu Be ny 1 xe lgiu m m To bou ta rg 3 lO Un E ite F CD d ran Ki c ng e do m EU 15 EU 2 Ne Aus 5 th tria er 4 la Ca nds na No da 1 Cz I rwa ec re y h lan Re d 2 p Au ub st lic ra li Sp a 2 ain Ne Sl w Z Ita ov e ly 1 ak ala Re nd 2 p Hu ubli ng c Po ary rtu Gr gal ee Tu ce 2 rk Po ey 3 l M and ex ico 2
0
1. 2003. 2. 2001. 3. 2000. 4. 1998. Source: OECD MSTI database, June 2004.
Collaboration remains key As firms attempt to extract greater value from their R&D investments in an era of uncertain growth, collaboration and external sourcing of technology can be expected to increase. The Battelle survey reports that industrial organisations expected to outsource 7% of their R&D activities in 2004, a 12% increase over 2003. They will outsource more to other companies, commercial laboratories and universities than to government laboratories, non-profit organisations or foreign laboratories (Duga and Studt, 2004). The IRI survey found that firms anticipated collaboration to play a more significant role than arms-length relationships. Firms expected to reduce outsourcing of R&D to other firms and inward licensing of technology, but to increase collaboration with university research consortia and government labs, and to enter into more joint ventures and alliances with other firms for R&D (IRI, 2003). Such collaboration is expected not only to augment internal capabilities, but also to help firms avoid staff increases until the economic situation becomes clearer. Although collaboration is important for business R&D, it is affected by the business and economic environment. Throughout the 1990s, as industry R&D financing grew, the share of higher education R&D financed by industry also grew, from 5.3% in 1990 to 6.2% in 2000. As the economic environment weakened after 2000 and businesses began cutting back on their R&D expenditures, industry financing of higher education also decreased, most notably in those countries where business R&D declined most. Across the OECD area, the share of HERD financed by industry fell to 5.8% in 2002. The decline was most pronounced in the United States, where the share of higher education R&D financed by industry dropped from 6.1% in 1999 to 4.5% in 2003, and in the United Kingdom, where it dropped from 7.1% in 2000 to 5.8% in 2002. In most EU countries, the share remained steady or continued to rise, consistent with growth in business R&D. This suggests that the recent reductions in industry financing of 29
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Box 1.2. Business R&D in firms large and small In most countries with high levels of R&D intensity, business R&D is concentrated in firms with more than 500 employees (Box Figure 1.1). More than 80% of business R&D in Japan, Korea, Germany, Sweden and the United States is conducted in large enterprises, and much of it in a small number of firms. Box Figure 1.1. Business R&D intensity and share of R&D performed by firms with 500 or more employees BERD as a share of GDP 3.0 Sweden
2.5
Finland 2.0
Switzerland
United States Japan Korea
Germany 1.5 France Denmark United Kingdom Belgium Canada Netherlands
Iceland 1.0
Norway Czech Republic Australia
0.5
Spain Poland
Hungary
Portugal
Turkey Mexico
0 0
10
20
30
40
Italy
50
60
70 80 90 100 Share of BERD performed by large firms
Source: OECD R&D database, February 2003.
In 2001 in the United States more than half of all business R&D was performed by firms with 10 000 or more employees – even though such firms represented less than 1% of all R&D-performing companies (NSB, 2004). Ten large firms accounted for about one-quarter of all business enterprise R&D (IRI, 2002).* In Sweden, the top ten R&D-performing companies account for about half of all business R&D, and the top 20% hold approximately 80% of all patents. Ericsson’s R&D expenditures were equivalent to almost 60% of Sweden’s BERD in 2001, although some of the R&D was performed elsewhere in Europe, Asia and North America (Ericsson, 2001). In Finland, Nokia was responsible for performing approximately one-third of Finnish BERD in 1999, and its global R&D expenditures were equivalent to more than 80% of Finnish BERD in 2001, although an estimated 40% of this funding was invested in foreign R&D centres (Ali-Yrkkö et al., 2000). In Korea, the top five companies account for 35% of total business expenditure on R&D, and 29.6% of total researchers employed in industry. The top 20 companies account for 55.4% and 40.2%, respectively (MOST, 2002). * The Industrial Research Institute reports that in 2001 Ford invested USD 7.4 billion in R&D, GM USD 6.2 billion, Lucent USD 3.5 billion, IBM USD 4.6 billion, Cisco Systems USD 3.9 billion, Motorola USD 4.4 billion, Intel USD 3.8 billion, Microsoft USD 4.8 billion, Pfizer USD 4.8 billion, Johnson and Johnson USD 3.6 billion. 30
© OECD 2004
Regaining Momentum in Science, Technology and Industry
Box 1.2. Business R&D in firms large and small (cont.) The role of large firms in driving high overall levels of business R&D intensity does not detract from the importance of SMEs in the innovation process. In the United States, for example, the share of business R&D performed by SMEs grew during the 1990s from approximately 12% to 18% of all business R&D, while the largest US firms (those with more than 10 000 employees) saw their share decline. Nevertheless, large firms may be important to the establishment and growth of SMEs, especially new technology-based firms (NTBFs). Not only do large firms purchase goods and services from SMEs, they also invest in them through mechanisms like corporate venture capital funds. Mergers and acquisitions by large firms can provide investors, such as venture capitalists, with an alternative to initial public offerings for recouping their investments in NTBFs, thereby encouraging venture financing. Strong links between NTBFs and large firms therefore appear to be important in boosting R&D intensity, whether such links are forged domestically or internationally.
higher education may be short-lived. As firms increase their R&D spending, they will increase their financing of universities as well. Government financing for business R&D is changing Both the volume and nature of government financing of business R&D are changing. Between 1991 and 2002, direct government funding of R&D performed in the business sector declined from USD 41.8 billion to USD 27.8 billion in real terms, or from 0.22% to 0.11% of GDP (Figure 1.7). These
Figure 1.7. Government funding of business R&D, 1991 and 2002 As a percentage of GDP 2002
1991
0.50 0.45 0.40 0.35 0.30 0.25 0.20 0.15 0.10 0.05 Un Sw ite ed d en 2 St at es Ko 1 Fr rea Ge anc e2 To rma ta ny 1 lO No ECD r Cz B way 2 ec elg h iu Re m pu bl ic E U1 Un ite E 5 2 d U Ki 25 ng 2 do Sl ov m ak I Re taly 1 pu b Fin lic lan Ne Aus d th tri er a 3 lan ds S 2 De pa Sw nm in itz ark 2 er Au land Ne s 2 w tra Ze lia 2 ala Ca nd 2 n Hu ada ng Lu Ice ary xe la m nd 2 bo ur Ja g 2 p Ire an lan Po d 2 la M nd ex i Tu co 2 Po rkey 2 rtu ga l2
0
1. 2003. 2. 2001. 3. 2000. Source: OECD MSTI Database, June 2004.
© OECD 2004
31
OECD Science, Technology and Industry Outlook 2004
figures are equivalent to 14.7% and 7.1%, respectively, of total business R&D; hence, they represent a small and declining fraction of total business R&D spending. Reductions have been most pronounced in the United States and the large European economies that had spent more heavily on defencerelated R&D. Shares financed by government remain highest in eastern European countries (e.g. the Slovak Republic, the Czech Republic, Poland and Hungary), which are in the midst of a transition to more market-oriented R&D, as well as in Italy and the United States, where spending tends to be linked to government missions, such as defence, energy and transport. In a few of the smaller OECD economies whose governments are beginning to play a more active role in innovation policy, such as Australia, Belgium, the Czech Republic and Finland, government financing for business R&D has increased. Australian funding, for example, more than doubled between 1999 and 2001 to almost USD 190 million, owing in large part to new initiatives aimed at enhancing Australia’s innovation capabilities (see Chapter 2). Interest is growing in ways to manage government financing of business R&D to ensure that it complements business R&D funding effectively and can help businesses overcome obstacles to innovation. While direct financing of business R&D has declined, indirect financing in the form of tax incentives for business R&D has risen as tax incentive programmes have become more generous. Since 2000, new tax incentive schemes have been introduced in Ireland, Norway and the United Kingdom (see Chapter 2 for a description of these schemes), many of which focus on small and medium-sized enterprises (SMEs). Several other countries have made existing tax incentive programmes more generous, for example, by increasing the rate of tax reduction or changing the methodology for calculating qualifying expenditures. In Portugal, for example, the rate of tax subsidies for EUR 1 of R&D investment increased by 35%, that in Spain increased by more than 15%, and those in the United Kingdom and United States by almost 10% between 1995 and 2001. Reductions in venture capital Reductions in business R&D have been accompanied by a severe downturn in venture capital. These reductions have been led by declines in the United States, which saw total venture capital investments plummet from a peak of USD 106 billion in 2000 to just USD 18 billion in 2003 (in nominal terms) and the number of annual investments fall from 8 068 to 2 779 (NVCA, 2004). In relative terms, early- and expansion-stage venture capital investments dropped by a factor of five, from 0.92% of GDP in 2000 to 0.17% of GDP in 2002. Canada also saw steep declines in early- and expansion-stage funding, from 0.58% to 0.20% of GDP. European venture capital investments declined as well, but somewhat more modestly than in North America, from a peak of EUR 19.6 billion in 2000 to EUR 9.8 billion in 2002 (EVCA, 2003). Early- and expansion-stage capital also dropped by half from 0.22% to 0.10% of GDP. Declines in Australia, Japan and Korea appear to have been less dramatic, but these countries tended to have lower levels of investment in venture capital and did not experience the same surge in venture capital investments during the late 1990s. Declines in venture capital have not been evenly distributed across industry sectors. They were particularly steep in the ICT sector. In the EU, ICT-related venture capital investments dropped from 0.12% to 0.05% of GDP between 2000 and 2002, while health and biotechnology-related investments declined more modestly from 0.04% to 0.03%. In the United States, venture capital investments in ICTrelated industries fell from 0.67% of GDP to 0.12% of GDP between 2000 and 2002, while those in health and biotechnology dropped from 0.08 to 0.05%. Investments in other technology areas remained relatively stable. Capitalising on science and technology investments
32
The direct output of national investments in science and technology continues to grow, according to a number of measures. In general, numbers of patents and published scientific and technical articles correlate closely with R&D spending. Countries with high R&D intensities also have high measures of patents and publications per million inhabitants, especially when time lags – between the completion of a research project and the production of a patent or publication – are taken into account (OECD, © OECD 2004
Regaining Momentum in Science, Technology and Industry
2002). While the number of patents and publications continued to grow in OECD countries in recent years, the rates of growth have slowed in many cases. Scientific publications OECD-wide, the number of published scientific and technical articles per million inhabitants has mirrored changes in R&D spending. Between 1991 and 2001, R&D spending increased by 40% in real terms, but R&D intensity (R&D spending as a share of GDP) remained essentially unchanged, declining in the first half of the decade and recovering in the second. Publications per million followed a similar track, declining slightly in the beginning of the decade and increasing after 1995 to 468 publications per million in 2001, 3% higher than in 1991. Between 1999 and 2001, however, publications per million remained relatively flat as did R&D intensity, and, as of 2001, OECD countries varied considerably in the number of scientific and technical articles published per million population (Figure 1.8). The range extends from Mexico, with 32 publications per million, to Sweden and Switzerland, each with more than 1 100. Growth has been driven by increases in Japan and the EU, as the number of publications per million declined by 8% in the United States, from 766 in 1991 to 705 in 2001, while growing by more than 30% in Japan and the EU15. Interestingly, the US reduction has occurred despite growing expenditures for basic research between 1995 and 2002, which might be expected to yield more publications than applied research (or development). Publication patterns by field of science show interesting trends. In spite of what is considered to be a dramatic increase in research funding for the life and medical sciences, the shares of publications in clinical medicine, biomedical research, biology and health sciences declined slightly between 1988 and 2001, from 55% to 53% of all scientific and technical publications. The fields that grew as a share of total publications were Earth and space sciences and engineering and technology, the latter most likely reflecting the boom in ICT-related fields. These patterns are most pronounced in the EU15, where medical and life sciences dropped from 56.7% to 49.2% of total publications and engineering and technology increased from 6.2% to 10%.
Figure 1.8. Scientific and engineering publications by country, 1991 and 2001 Published articles per million inhabitants 2001
1991
1 200
1 000
800
600
400
200
S Sw we itz den er la Fin nd Un D lan ite en d d ma K Ne ing rk th do er m l A an Ne ust ds w ral Ze ia ala Ca nd na Un No da ite rw d ay St a Ic tes e Be land lg iu Au m st ria Ge EU1 rm 5 an Fr y 2 an ce To EU ta 25 lO EC Ja D p Ire an lan Sp d ain Cz I ec G taly h re Re ec pu e Hu blic 1 ng ar Ko y Sl ov Po rea ak rtu Re ga pu l b Po lic lan Tu d rk M ey ex ico
0
Source: National Science Board (2004). Population data from OECD MSTI database, June 2004.
© OECD 2004
33
OECD Science, Technology and Industry Outlook 2004
Is the patent boom slowing? Throughout the 1990s, increases in business R&D went hand in hand with increased patenting. More than 850 000 patent applications were filed at the European Patent Office (EPO), the Japan Patent Office (JPO) and the US Patent and Trademark Office (USPTO) in 2002, up from 600 000 in 1992 (Figure 1.9). The number of triadic patent families – patents filed at the EPO, JPO and USPTO to protect the same invention 4 – also increased rapidly during the 1990s, rising by approximately 30% between 1994 and 2000, from 31 700 to 42 700 (Figure 1.10).5 The number of patent families per million population also increased notably in most OECD countries between 1991 and 2000, with the highest patent family densities in Switzerland, Sweden, Japan, Finland and Germany. Interestingly, growth in patent applications and in patent families slowed dramatically towards the end of the decade. Even through R&D spending continued to climb in preceding years, the number of filings at the EPO and JPO declined between 2001 and 2002, and the rate of growth in applications to the USPTO fell from its level of 10% a year during the late 1990s to below 3%. After growing from 31 700 to 41 500 between 1994 and 1997, the number of OECD-wide patent families rose by only an additional 1 300 in the three-year period ending in 2000. The slowdown occurred in all the largest patenting countries – France, Germany, Japan and the United States – and in the EU25. As a result, regional shares of patent families remained relatively constant: the United States retained the largest share, with approximately 35% of total OECD patent families; the EU25 held approximately 32%, and Japan held approximately 26%. Much of the growth in patenting is driven by high-technology sectors. By 2000, approximately 35% of patents filed at the EPO were related to ICT, including some 40% of applications from Japanese and US inventors. Biotechnology patenting also grew rapidly after 1993 and by 2001 accounted for more than 5.5% of EPO applications, including 9% of applications from US inventors. Moreover, nearly half the increase in patenting at the EPO between 1994 and 2001 came from patents in ICT and biotechnology. Similar patterns were observed at the USPTO and JPO. The longer-term growth in patenting over the past two decades reflects a number of fundamental changes in industry structure, business innovation processes, patenting strategies and patent regimes.
Figure 1.9. Patent filings in the main patent offices JPO filings
USPTO filings
EPO filings
EPO and USPTO filings: total number of applications 400 000
JPO filings: total number of claims 4 000 000
350 000
3 500 000
300 000
3 000 000
250 000
2 500 000
200 000
2 000 000
150 000
1 500 000
100 000
1 000 000
50 000 0 1982 83
34
500 000
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99 2000 01
0 02
Note: EPO and USPTO filings correspond to total number of applications. JPO filings correspond to total number of claims (number of claims per application multiplied by total number of applications) to account for the effect of the 1988 law reform allowing more than one claim per patent application at JPO. Source: OECD Patent Database and USPTO, EPO and JPO Annual Reports. JPO figures for 2001 and 2002 are OECD estimates.
© OECD 2004
Regaining Momentum in Science, Technology and Industry
Figure 1.10. Number of triadic patent families1 According to the residence of the inventors, by priority year2 United States
Japan
EU15
Total
45 000 Total families
30 000
15 000
0 1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999 2000
1. Patents applied for the same invention at the European Patent Office, Japan Patent Office and US Patent and Trademarks Office. 1999 and 2000 figures are estimates. 2. Priority year refers to the year in which the patent application was first filed. It is therefore closer to the date of invention than is the year in which the patent was granted. Source: OECD Patents database, July 2004.
Although the relative importance of these factors is difficult to determine, some insight can be gleaned from a recent survey of firm patenting and licensing strategies conducted by the OECD and the Business and Industry Advisory Committee (BIAC), which identified several factors behind growing patenting activity:6 • Increased inventiveness. Part of the rise in patenting derives from an increase in the number of inventions generated by firms, owing to increased business R&D and increased efficiency of R&D expenditures. In the OECD/BIAC survey, 78% of firms cited a greater number of inventions as a very or moderately important driver of their patenting growth, and statistics indicate that OECDwide expenditures on business R&D increased 38% between 1991 and 2001. • Increased international patenting. Inventors increasingly file patents to protect the same invention in several geographic areas. Of the more than 160 000 applications filed at the USPTO in 2002, for example, more than 70 000 were also filed with the EPO and with the JPO. • Increasing proclivity to patent inventions. Almost 70% of respondents to the OECD/BIAC survey reported that they patented inventions they would not have sought to patent ten years earlier. At the EPO, in particular, the ratio of patent applications to industry-financed R&D increased notably during the 1990s. • Expansion of patentable subject matter to cover inventions related to software, business methods and genetic inventions (although regional differences remain). As noted above, ICT-related patents (including software) and biotechnology patents accounted for much of the growth in patenting in all three patent offices. • Increased protection afforded by patents. Many firms report that patenting has become a more effective means of protecting their competitive position. They perceive a strengthening of patent holder’s rights and stronger enforcement of patent rights. Some of these changes reflect changes in innovation processes themselves. Innovation is now seen as more central to business strategy, and firms, especially in high-technology industries, view © OECD 2004
35
OECD Science, Technology and Industry Outlook 2004
innovation as a key source of competitive advantage. Innovation is also occurring in a more diverse range of firms, including services firms, SMEs and new technology-based firms. The latter often have few competitive assets other than their intellectual property and patents can be important in attracting venture capital and other financial investments. More competitive global markets have also encouraged firms to protect their intellectual property more actively. Finally, innovation is becoming less centred around individual firms and more dependent on co-operation and technology sharing. Patents can become a currency in such markets to enable transfers of technology. Reforms to national and international patent regimes have also tended to encourage patenting by strengthening the protection afforded by patents, as well as their enforcement. New governing bodies with global reach, such as the World Intellectual Property Organization (WIPO) and the World Trade Organization (WTO), have facilitated international patent filing and enhanced global enforcement of patents. Creation of specialised courts for intellectual property disputes has tended to further enforce patent holders’ rights and increase damage awards for infringements. Reductions in EPO filing fees have reduced the cost of patenting, despite the fact that many firms report that overall costs of patenting (filing, enforcement, renewal) have not changed significantly. Together, these changes have made patenting a simpler, less costly and more effective means of protecting inventions, and this has encouraged increased patenting across the OECD area. Human resources for science and technology The size of the scientific and technological workforce tends to follow trends in R&D spending, as a large fraction of R&D expenditures pays for workers’ salaries. This was apparent throughout the 1990s, when the total number of researchers in OECD countries increased from 2.3 million in 1990 to 3.4 million in 2000.7 The share of researchers in the workforce also grew from 5.6 per thousand in 1990 to 6.5 per thousand in 2000. Countries with strong high-technology sectors, such as Finland, Japan and Sweden, have among the highest densities of researchers, with Finland’s reaching 16.4 per thousand in 2002, up from fewer than 6.0 per thousand in 1990. Researchers per thousand in the Czech Republic, Hungary, Poland and the Slovak Republic remain below the OECD average and range between 2.9 and 4.6 researchers per thousand, despite modest growth. Numbers of researchers are growing Business enterprise researchers continue to account for the bulk of the researcher population. In 2000, some 64% of all researchers in OECD countries (or 2.2 million of the total 3.4 million) worked in the business sector, a figure that remained fairly constant over the previous decade. Nevertheless, clear regional differences remain. Business researchers represented more than 80% of US researchers in 1999; in Japan and Korea, business researchers accounted for 67% and 74%, respectively, of the researcher population in 2002. These figures are far above those of the EU25, where business researchers comprised only 48% of the research population in 2001, a figure that has increased modestly in recent years as BERD spending has increased. Nevertheless, the low relative level of business researchers has remained an issue in the EU, especially as the region attempts to meet its objective of boosting R&D spending to 3% of GDP by 2010 – a task that by some estimates would require an additional 700 000 researchers, mostly in the business sector.
36
Trends in the population of business researchers follow patterns of R&D spending. Between 1995 and 2002, the number of business researchers per thousand employees increased from 3.6 to 4.1 (Figure 1.11). The largest gains were seen in Finland, which saw a jump from 3.2 to 9.0 business researchers per thousand workers. In Japan and the US, the numbers increased from just below 6.0 to almost 7.0. Business researchers per thousand are well below OECD average in the EU and remain at 1.2 per thousand or below in most eastern European economies. Real declines in business R&D expenditure in the United States can be expected to reduce the size of the US research population in 2001 and 2002 (data are not yet available), but sustained growth in R&D spending can be expected to © OECD 2004
Regaining Momentum in Science, Technology and Industry
Figure 1.11. Business researchers per thousand employees in OECD countries, 1995 and 2002 2002
1995 55.1
Finland United States (1999) Japan2 Sweden (2001) Luxembourg (2000) Norway (2001) Korea Belgium (2001) Canada (2000) Total OECD (2000) Germany Switzerland (2000) France (2001) Denmark (2001) Ireland (2000) United Kingdom (1998) EU15 (2001) Austria (1998) Netherlands (2001) EU25 (2001) Australia (2000) New Zealand (2001) Spain Czech Republic Italy (2001) Hungary Slovak Republic Greece (1999) Portugal (2001) Poland Turkey (2000) Mexico (1999)
80.5 66.7 60.6 86.1 56.3 73.4 55.8 60.8 63.8 58.8 62.9 49.9 49.6 66.1 57.9 51.1 62.6 49.5 48.0 24.4 24.9 29.6 Business researchers, 41.3 as a percentage of total researchers, 2002 or nearest year available 39.8 29.0 23.6 15.2 15.4 8.3 16.0 16.2 0
2
4
6
8
10 %
Source: OECD MSTI database, June 2004.
encourage firms to hire additional researchers. Germany reported a small reduction in business researchers between 2001 and 2002, but the total remains above the 2000 level. Most other OECD countries have continued to report growing numbers of business researchers, commensurate with increases in business R&D spending. In the United Kingdom, for example, the number of business researchers jumped from 86 000 in 2000 to 105 000 in 2002; 8 in Japan it increased from 421 000 to 431 000; and in Korea it rose sharply from 72 000 to 104 000. Numbers of higher-education researchers have also continued to grow. Between 1997 and 2001, the number of researchers in the higher-education sector of the EU25 countries grew from 350 000 to more than 416 000. Numbers of government researchers, however, have declined slightly from their peak level in 1999. Across the OECD, the number of government researchers declined from 273 000 in 1999 to less than 271 000 in 2001, with the EU25 shedding some 7 000 government researchers. Government researchers represented just over 8% of the total research workforce in 2000, down from almost 10% in 1991, but they continue to comprise a significant share in several eastern European countries. In the Czech Republic, Hungary, Poland and the Slovak Republic, government researchers continued to account for 25% or more of all researchers in 2002. © OECD 2004
37
OECD Science, Technology and Industry Outlook 2004
Supplies may be strained Growing demand for researchers and for a much larger pool of human resources for science and technology (HRST) can be expected to strain supply. In most OECD countries, HRST now account for 25% to 35% of total employment. Growth in HRST occupations has been much faster than total employment. In the United States, Germany, the United Kingdom and France (the largest OECD economies for which data are available), growth in HRST occupations ranged between 2% and 2.5% a year between 1995 and 2002, while overall employment grew by 1.1% or less (Figure 1.12). Even in Ireland and Spain, which saw annual employment growth of 4.5% and 4%, respectively, during the period, HRST employment grew rapidly, at 7.1% and 8.4% a year, respectively. At the same time, changing demographics have resulted in an overall ageing of the research workforce in many OECD countries, especially in the public research sector. Moreover, there is concern about an apparent decline in interest in science and engineering among youth in many OECD countries and declining graduation rates in science and engineering fields in some countries. Across the OECD, the number of tertiary-level graduates in science and engineering has grown in recent years. Between 1998 and 2001, science graduates increased 5% annually from 511 000 to 566 000; engineering graduates increased more slowly, rising at less than 1% a year from 657 000 to 669 000. Their growth has been slower than that of overall graduates; hence, while science graduates
Figure 1.12. Growth in employment in HRST occupations, 1995-2002 Average annual growth rate Total employment Spain Norway (1999-2001) Ireland Iceland (1999-2001) Luxembourg (1995-2001) Italy Netherlands Denmark Sweden (1997-2001) Korea Australia (1996-2001) New Zealand (1996-2001) Canada Greece United Kingdom Finland (1997-2001) Belgium (1995-2001) France Austria (1995-2001) United States Germany (1995-2001) Czech Republic Switzerland (1999-2002) Slovak Republic (1999-2002) Portugal Hungary (1999-2001) Poland (1999-2001) 9
38
6
3
0
-3 %
Source: OECD calculations and estimates, based on data from the Eurostat Community Labour Force Survey, the US Current Population Survey, the Canadian and Japanese labour force surveys, the Korean Economically Active Population Survey and the Australia and New Zealand censuses, May 2003.
© OECD 2004
Regaining Momentum in Science, Technology and Industry
increased from 9.6% to 10% of total graduates, engineering graduates declined from 12.4% to 11.8%, owing mostly to reductions in the United States and Europe, including both the larger European economies (France, Germany and the United Kingdom) and those in eastern Europe (the Czech Republic, Hungary and Poland). Globalisation of science, technology and industry Growing attention is being paid to the globalisation of science, technology and industry. While it has long been accepted that certain industrial activities, such as manufacturing, sales and marketing, need to be near international markets for goods and services, it had been thought that other, more knowledge-intensive portions of value chains would remain closer to home. Recent years have seen increased globalisation of R&D – a phenomenon that has caused particular concern because it is seen as moving high-productivity, high value-added jobs to foreign countries. Moreover, while globalisation of R&D had been seen as a step subsequent to the globalisation of manufacturing and geared towards the customisation of products and services to local needs, it is now increasingly divorced from manufacturing and linked to the development of global knowledge networks. Firms establish R&D facilities in foreign countries not just to be near local markets, but to be near centres of scientific and technological excellence where they can tap into local knowledge (and then transfer it elsewhere in their corporation). As such, globalisation of R&D owes as much to the growing capabilities of non-OECD economies as it does to the strategies of multinational enterprises. Non-members more capable A number of non-OECD economies are making rapid strides in their scientific and technological capabilities. In terms of R&D funding alone, China’s R&D intensity doubled from 0.6% to 1.2% of GDP between 1995 and 2002, and its total R&D investment rose to USD 72 billion, third only to the United States and Japan (Figure 1.13). The Russian Federation, Israel and Singapore also made significant progress in R&D expenditure, with expenditures reaching USD 14.7 billion, USD 6.3 billion and USD 2.0 billion, respectively, in 2002. Israel’s R&D intensity reached 4.72% – higher than that of any OECD country – and that of Singapore exceeded 2.0%. The fruits of these investments are becoming evident as well. Israel’s production of published scientific and technical articles per million inhabitants, at
Figure 1.13. R&D intensity in non-OECD economies as a share of GDP 2002
% 5.0
1996
4.0
3.0
2.0
1.0
0 Israel
Chinese Taipei
Source: MSTI Database, June 2004.
© OECD 2004
Singapore
Slovenia
Russian Federation
China
Argentina
Romania
39
OECD Science, Technology and Industry Outlook 2004
Figure 1.14. Regional and national shares of triadic patent families 2000
% 40
1991
35 30 25 20 15 10 5 0 United States
EU25
Japan
Other OECD
Rest of world
Source: OECD Patents database, June 2004.
1 007 in 2001, exceeds that of all OECD countries except Sweden and Switzerland, and that of Russia (110) is above that of some newer OECD members. The number of patent families held by Chinese inventors rose from 12 in 1991 to 93 in 2001, placing it ahead of a dozen of the smaller OECD economies, but the number of Chinese patent families per million inhabitants remains far below OECD average. Such advances must be placed in context. Available statistics provide evidence that scientific and technological capabilities are spreading more broadly across the globe, but they also show the limits of that expansion. For example, in 1995, the R&D expenditures of China, Israel and the Russian Federation totalled USD 28 billion, equivalent to 6.4% of OECD R&D expenditures.9 By 2001, R&D spending in these three countries had risen to USD 85 billion, or 14.7% of OECD R&D expenditures. When a fuller set of non-member economies, including Argentina, Romania, Singapore and Chinese Taipei, are added to the calculation, the share rises to 17%. Hence, while R&D spending has grown rapidly in non-member economies, it remains at about one-sixth the level of OECD countries. Relative shares of patent families show a similar pattern. The United States, the EU25 and Japan accounted for 94.4% of all triadic patent families in 1991; by 2000, that share had declined modestly to 92.7%, with most of the reduction in the shares of EU and Japanese patent holders (Figure 1.14). The share of all countries outside the United States, EU25 and Japan rose from 5.6% to 7.3%. It can be expected that this share will continue to rise as other countries become more fully integrated into global innovation structures. Foreign affiliates expanding Rising levels of R&D spending by foreign affiliates of multinational enterprises are contributing to R&D spending in OECD countries and non-member economies (Figure 1.15). R&D performed by foreign affiliates represents over 12% of total expenditures on industrial R&D in the OECD area. Total R&D performed by foreign affiliates in selected OECD countries increased by more than 50% in nominal terms between 1995 and 2000, to more than USD 50 billion. Foreign affiliates accounted for approximately 17% of US R&D in 2001 and more than 20% in France and Germany. They accounted for between 30% and 40% of R&D in the United Kingdom, the Netherlands, Canada, Sweden and Spain, and more than 70% in Hungary and Ireland. These shares have risen most noticeably in the Czech Republic, Hungary, Sweden and the United Kingdom, and have remained relatively constant or increased only 40
© OECD 2004
Regaining Momentum in Science, Technology and Industry
Figure 1.15. R&D investments by foreign affiliates, 1995-2001 As % of R&D expenditure by enterprises 1995
2001
% 80 70 60 50 40 30 20 10
Ja pa n
Gr ee ce
Fin lan d
Ne th er lan ds Un ite d St at es
Fr an ce
Ge rm an y
Ca na da
lia
Sw ed Un en ite d Ki ng do m
ra st Au
Sp ain
Re pu bl ic
Ire lan d
Cz ec h
Hu ng ar
y
0
Note: Or nearest available years. 1995-99 for Australia, Germany, Greece, Hungary; 1995-2000 for Japan, Sweden; 1995-2002 for the United Kingdom; 1997-2002 for the Czech Republic; 1997-2001 for Finland; 1997-2000 for the Netherlands. Source: OECD, AFA Database, May 2004
slowly in most other countries, suggesting that foreign affiliate R&D has increased roughly as fast as domestic R&D. A considerable portion of the R&D performed by foreign affiliates remains in the OECD area. In 2000, for example, USD 15 billion of the USD 23 billion in manufacturing R&D performed by foreign affiliates in the United States came from firms headquartered in the EU15 or Japan. Similarly USD 13 billion of the spending by foreign affiliates in the EU15 came from the United States or Japan. Between 1994 and 2000, the United States experienced a gain in its share of OECD foreign affiliate R&D funding, from 45% to 55%. A significant portion of the shift towards the United States came from EU firms. Between 1994 and 2000, R&D expenditures of US-based affiliates of EU firms climbed by USD 6.3 billion, from approximately USD 7 billion to more than USD 13 billion (Figure 1.16). US firms increased their R&D investments in EU-based affiliates from USD 7.4 billion to USD 11.2 billion, a gain of USD 3.8 billion. As a result, the net difference shifted from an advantage of USD 500 million for the EU to a net gain of USD 2 billion for the United States. In the 1990s, inward R&D investments in the United States were aimed primarily at high-technology areas. Pharmaceuticals and communications equipment alone accounted for more than half of the R&D expenditures by foreign affiliates in 2000. This figure tends to confirm that firms increasingly locate R&D facilities near centres of scientific and engineering expertise, not just near markets of interest. While much R&D funding attributed to foreign affiliates takes place among OECD countries, nonmembers appear to be playing a larger role. In the case of the United States (for which the most complete data are available), outward R&D investments in foreign affiliates nearly doubled between 1994 and 2000, from USD 12 billion to just under USD 20 billion. While impressive in absolute terms, these figures represent a relative reduction in outward R&D investments, from 12.0% to 10.8% of total industry R&D spending. Motor vehicles; radio, televisions and communications equipment; computing equipment and non-pharmaceutical chemicals comprised the bulk of this investment. While outward investments grew in all major regions of the globe in nominal terms, growth has been fastest © OECD 2004
41
OECD Science, Technology and Industry Outlook 2004
Figure 1.16. Changes in R&D spending by foreign affiliates, 1994-2000 R&D expenditures in manufacturing, millions of current PPP USD 1994
2000
14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 US affiliates of EU firms1
EU affiliates of US firms
US affiliates of Japanese firms1
Japanese affiliates of US firms2
1. 1994 data refer to R&D funded by majority- and minority-owned affiliates; 2000 data refers to R&D performed by majority- and minority-owned affiliates. 2. Data refer to majority-owned affiliates only. Source: Estimates data based on OECD MSTI database May 2004 and OECD AFA database, June 2004.
outside the EU15, Canada and Japan. Investments in the rest of world grew by a factor of 2.5 during the period. In the case of China, US R&D investments increased from USD 7 million in 1994 to USD 506 million in 2000 (Figure 1.17). Such trends can be expected to continue as long as countries such as China build up their science and technology infrastructure and open markets to foreign entrants.
Figure 1.17. Outward investment in R&D by US-owned firms Millions of USD EU
Canada
Japan
Rest of the world
20 000 17 500 15 000 12 500 10 000 7 500 5 000 2 500 0 1994
42
2000
Source: OECD AFA Database, February 2004.
© OECD 2004
Regaining Momentum in Science, Technology and Industry
Conclusion OECD countries continue to advance in their exploration and exploitation of science, technology and innovation with the aim of improving industrial performance and economic growth. While the economic downturn limited the ability of many firms and governments to maintain high levels of growth in science and technology investment as the entered the new millennium, they will be better able to regain their momentum if the economic recovery unfolds as expected. To ensure that the benefits of science, technology and innovation continue to accrue to OECD countries, however, policy makers will need to continue to take steps to ensure the development of human resources for science and technology and to develop science, technology and innovation policies that will enable them to benefit effectively from the growing technological capabilities of non-member economies.
43
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
NOTES 1. OECD defines high-technology industries as the following: aircraft and spacecraft; pharmaceuticals; office, accounting and computing machinery; radio, TV and communications equipment; and medical, precision and optical instruments. Medium-high technology industries are: electrical machinery and apparatus not elsewhere classified; motor vehicles, trailers and semi-trailers; chemicals excluding pharmaceuticals; railroad equipment and transport equipment not elsewhere classified; and machinery and equipment not elsewhere classified. Knowledge-intensive market services include: post and telecommunications services; finance and insurance services; and business activities (excluding real estate activities). 2. Manufacturing trade figures are based on the average value of imports and exports. 3. Technology balance of payments data capture commercial transactions related to international technology transfers. It includes money paid or received for the acquisition and use of patents, licences, trademarks, designs, know-how and closely related technical services and for industrial R&D carried out abroad. 4. Because they represent patents filed in the three major patent offices, patent families are often considered to count high-quality patents that inventors expect to exploit globally and for which they are willing to pay application and maintenance fees to several patent offices. By avoiding multiple counting, they also tend to reduce some of the effects of international patenting. 5. The years shown for patent families refers to the priority year of the application; that is, the year the first application was filed. Grant dates tend to be several years later. 6. See OECD (2004) for a more complete summary of the survey results. 7. Researchers are defined as professionals engaged in the conception and creation of new knowledge, products, processes, methods and systems and are directly involved in the management of projects. In this report, numbers of researchers are expressed in full-time equivalents and include staff engaged in R&D during the course of one year. 8. Some of the increase in business researchers in the UK resulted from the privatisation of the Defence Evaluation and Research Agency in 2001. 9. China, Israel and the Russian Federation are three of the Observers to the OECD’s Committee for Scientific and Technological Policy for which science and technology statistics are collected. South Africa is he fourth Observer country.
44
© OECD 2004
Regaining Momentum in Science, Technology and Industry
REFERENCES Ali-Yrkkö, J., L. Paija, C. Reilly and P. Ylä-Antilla (2000), “Nokia: A Big Company in a Small Country”, ETLA, The Research Institute of the Finnish Economy, Helsinki. Duga, J. and T. Studt (2004), “2004 Battelle/R&D Magazine R&D Funding Forecast”, R&D Magazine, January. Ericsson Corp. (2001), Ericsson Research 2001, Available at: www.ericsson.com/technology/docs/Ericsson_Research_2001.pdf. European Commission (EC) (2002), “Presidency Conclusions: Barcelona European Council, 15 and 16 March 2002”, SN 100/02, Brussels. European Private Equity and Venture Capital Association (EVCA) (2003), EVCA Yearbook 2003, EVCA, Zaventem, Belgium. European Roundtable of Industrialists (ERT) (2003), The European Challenge, ERT, Brussels. Available at: www.ert.be. Industrial Research Institute (IRI) (2002), IRI Industrial R&D Scoreboard for 2002, Washington DC. Available at: www.iriinc.org. Industrial Research Institute (IRI) (2003). Industrial Research Institute’s R&D Trends Forecast for 2004, Washington DC, October. Korean Ministry of Science and Technology (MOST), (2002), Korean Research and Development in Science and Technology, Seoul. National Science Board (NSB) (2002), Science and Engineering Indicators 2002, National Science Foundation, Arlington, Virginia. National Science Board (NSB) (2004), Science and Engineering Indicators 2004, National Science Foundation, Arlington, Virginia. National Venture Capital Association (NVCA) (2004), “Latest Industry Statistics”, available at: www.ncva.org/ffax.html. OECD (2002), OECD Science, Technology and Industry Outlook 2002, Paris. OECD (2004), IPR, Innovation and Economic Performance: OECD Conference Proceedings, Paris. Sheehan, J. and A. Wyckoff (2003), “Targeting R&D: Economic and Policy Implications of Increasing R&D Spending”, DSTI Working Paper 2003/8, OECD, Paris.
45
© OECD 2004
Chapter 2
RECENT DEVELOPMENTS IN SCIENCE, TECHNOLOGY AND INNOVATION POLICIES
Innovation has been an area of considerable policy development in recent years and, in most cases, of growing public funding. Governments have developed strategic plans for enhancing innovation performance and accelerating their nations’ transformation into knowledge-based economies. They have forged more explicit links to industry and other stakeholders so as to solicit expert opinion and advice that can inform policy development. This chapter reviews recent developments in science, technology and innovation policy in OECD countries. It reviews the main directions and objectives of national policies and addresses policy developments related to public-sector research, government support for private-sector R&D and innovation, collaboration and networking among innovating organisations, human resources for S&T, and policy evaluation.
47
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction As the pace of technological change quickens and innovation requires more complex and interactive management (Tidd, Bessant, and Pavitt, 1997), policy makers continue to adapt science, technology and innovation policies. This chapter reviews recent developments in these policies in OECD countries and in observers to its Committee for Scientific and Technological Policy (CSTP), focusing on changes introduced in 2002-04.1 It draws on responses to an OECD questionnaire sent to national delegates concerning topics that are high on the agendas of policy makers in these areas. The chapter first outlines general trends in science, technology and innovation policies and reviews the main directions and objectives of national policies. It then addresses policy developments related to public-sector research, government support for private-sector R&D and innovation, collaboration and networking among innovating organisations, human resources for S&T, and policy evaluation.2 In spite of considerable differences in their economic situations, industry structure and innovation systems, OECD countries recognise that innovation makes an increasingly important contribution to sustainable economic growth (OECD, 2001a, 2001b). Their science, technology and innovation policies show a number of common general trends: • Strategic planning for innovation. Innovation has become a priority on the national agendas of most OECD countries. Many have developed strategic plans that establish explicit objectives for innovation policy, mainly to transform the nation into a knowledge-based economy. • New governance structures for innovation policy. To increase the efficiency of national innovation systems, many OECD countries have implemented or amended laws and institutional structures governing innovation policy. The primary objectives are to enhance co-ordination when developing and implementing innovation policy, to reduce bureaucracy in universities and public research organisations, to strengthen the contribution of science to socio-economic concerns, and to integrate research better with industrial development. • Increased public R&D expenditures. Despite budget constraints, public expenditures on R&D continue to grow. Much of the increase is focused on specific fields, in particular information and communication technology (ICT), biotechnology and nanotechnology, which are expected to contribute to economic growth and employment. Many EU countries have national targets for expanding R&D expenditures in accordance with the objective set by the Barcelona European Council in March 2002.3 Japan increased government R&D expenditures by approximately JPY 24 trillion from fiscal year (FY) 2001 to FY 2005, and Korea’s target is to double national R&D investment between 2001 and 2007. US government expenditures on R&D continue to rise since 2002, driven largely by concerns about safety and security. • Transition to more project–based funding in public research institutions. Almost all OECD countries are financing a larger share of public research via project-based funds (e.g. contracts and grants) instead of institutional funds (e.g. block grants). Their aims are to: i) stimulate competition and co-operation among research centres while maintaining their independence; and ii) encourage public institutions to seek external funds based on their ability to meet users’ needs.
48
• Strengthening of policy initiatives to encourage industrial R&D and innovation. In general, OECD countries have increased the scope and intensity of programmes to boost business R&D and innovation through a range of policy instruments: direct public funding of business R&D and innovation (e.g. grants and loans); tax incentives for R&D; strengthened intellectual property rights (IPR) regimes; development of venture capital; and support for R&D and innovation in small and medium-sized enterprises (SMEs) and new technology-based firms. In general, support for direct © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
financing mechanisms has declined, while that for indirect mechanisms (e.g. tax incentives, IPR) has increased. • Increased attention to industry-science linkages. OECD governments have taken a number of steps to increase linkages between the public research system and industry to facilitate technology transfer and enhance the responsiveness of research to the needs of industry and society. Several countries have implemented legislation to grant ownership of intellectual property resulting from government-funded research to the performing institution rather than to researchers. Others have expanded support for public/private partnership (P/PP) programmes to link universities, government research laboratories and industry for research and innovation. • Growing concern about human resources for science and technology. Almost all OECD countries are increasingly concerned about future supplies of human resources for science and technology. They note a growing demand for researchers in a knowledge-based economy but declining interest in science and technology among students. Efforts to address such concerns include programmes to improve public understanding of science, reform education curricula and enhance career prospects in the public research sector. Most countries have expanded programmes to encourage international mobility of S&T workers and promote return migration of expatriated researchers. • Greater attention to policy evaluation. OECD countries have increased their demand for policy evaluation at all levels: individual policy instruments, key institutions and national innovation systems. In the Czech Republic, Denmark, the Netherlands, New Zealand, Sweden and Switzerland, formal evaluations of national innovation policies have become compulsory. Australia has already undertaken extensive evaluations of all innovation policies. Main directions for science, technology, and innovation policies Innovation has been an area of considerable policy development in recent years and, in most cases, of growing public funding. Governments have developed strategic plans for enhancing innovation performance and accelerating their nations’ transformation into knowledge-based economies. To implement these plans and achieve their objectives, countries have modified institutional structures for policy formulation and governance of the innovation system. Recognising the wide range of policy domains that impinge on innovation, many countries have also created or revamped structures for ensuring greater co-ordination among government ministries, departments and agencies. They have also forged more explicit links to industry and other stakeholders so as to solicit expert opinion and advice that can inform policy development. National plans for science, technology and innovation In recent years, nearly all OECD countries have developed high-level policy documents outlining their ambitions and strategies for improving innovation capabilities (Table 2.1). Australia, Canada and Norway have set up overarching innovation plans that cross the policy domains of many government ministries. Hungary and Ireland have placed science, technology and innovation policies in a more prominent position in overall national development strategies. Japan, Korea and Spain have introduced new science and technology strategies for achieving a knowledge-based society. A number of these developments are reviewed below. In November 2002, Australia’s Prime Minister announced that science and innovation was one of the government’s nine strategic priorities and announced four National Research Priorities (described later in this chapter). The Backing Australia’s Ability (BAA) initiative, which was introduced in 2001, has been expanded in recognition of the critical role that innovation plays in Australia’s future prosperity. The government recently announced the follow-up package to BAA, Backing Australia’s Ability – Building Our Future through Science and Innovation; funding will be increased to more than AUD 1 billion a year (until 2010-11) to fund research in areas of particular social, economic and © OECD 2004
49
OECD Science, Technology and Industry Outlook 2004
environmental importance. The programme’s whole-of-government focus should help to improve research and broader policy outcomes. Austria’s Research and Technology Council, an advisory body of the federal government, issued a new planning document, the National Action Plan for Research and Innovation. Its main objectives are: increased efficiency by better leveraging public and private funding; co-operation and networking to attain critical mass and size in research and technological innovation; excellence in basic research; investment in education, training and qualification for highly skilled, motivated knowledge workers; improved fiscal incentives for enterprises engaged in research and technological innovation; and structural reorganisation to reduce bureaucracy in public research organisations. In February 2002, Canada launched its innovation strategy with the release of two key documents: Achieving Excellence and Knowledge Matters. After extensive consultations with Canadians, a National Summit on Innovation and Learning (November 2002) identified a variety of priorities for action. In February 2004, the government announced the goal of making Canada a world leader in the pathbreaking technologies of the 21st century: biotechnology, environmental technology, information and communications technologies, health technologies and nanotechnology. In 2001, Canada had already set a goal of reaching the top five within the OECD in terms of R&D funding as a share of GDP. The Czech Republic made innovation a priority issue in the National Research and Development Policy of the Czech Republic 2004-08, which was approved in January 2004. Key elements include improvement of research evaluation, international and inter-regional co-operation, human resources, and transfer of R&D results to industry. In March 2004, the Czech government approved the National Innovation Strategy. Via the Technology Centre of Academy of Sciences, the Czech Republic plans to undertake technology foresight exercises to identify priority fields for its national research programme. Knowledge in Growth, an ambitious plan to strengthen the Danish knowledge system, was released in January 2003. This White Paper lays out Denmark’s overall vision and puts forward a strategy to strengthen Denmark’s position as a leading knowledge society which increasingly produces, attracts, spreads and utilises knowledge. A new Act on Technology and Innovation defines the following aims: i) co-operation and dissemination of knowledge between knowledge-producing and knowledge-using institutions; ii) development, diffusion, utilisation and commercialising of research results, new technology, organisational and market knowledge; iii) development of knowledge- and technologybased companies; iv) provision of finance and competence for knowledge- and technology-based companies; and v) international co-operation on the utilisation of knowledge and technology. From 2001 to 2004, the government is carrying out a technological foresight pilot programme, which will be closely linked to the establishment of a new Future Fund for the development of generic technologies of importance to the nation, including biotechnology, ICT and nanotechnology. Finland’s new government emphasises strengthening expertise and entrepreneurship, recognising that the keys to maintaining Finland’s competitiveness are promoting R&D, raising the educational level of the population, pursuing a co-operative approach to income policy, boosting productivity of the public sector, and speeding application of ICT. The triennial review of the Science and Technology Policy Council, entitled Knowledge, Innovation and Internationalisation, found that success in innovation is a key factor for the success of both business enterprises and societies. The Hungarian government’s programme for 2002-06 and its medium-term economic policy programme define science and technology policy as important government tools to promote social and economic development. Four of the priorities defined by the programme are: i) a legal framework that is conducive to innovation; ii) making Hungary an attractive location for R&D; iii) enhancing protection of IPR; and iv) increasing the resources for innovation for SMEs.
50
Ireland has a strong policy focus on the role of science and technology in supporting economic growth and development. Ireland has been extraordinarily successful in attracting foreign investment, and industry policy has shifted its focus to high-value, knowledge-driven industry, both from abroad and at home. This goal is underpinned by investment in education – particularly higher education. © OECD 2004
Recent Developments in Science, Technology andInnovation Policies
Table 2.1. Summary of national plans for science, technology and innovation policy in OECD countries National plan
Main objectives
Australia
Backing Australia’s Ability (BAA)
Austria
National Action Plan for Research and Innovation Achieving Excellence; Knowledge Matters National Research and Development Policy Knowledge in Growth
Strengthen Australia’s ability to generate ideas and undertake research; accelerate the commercialisation of ideas, and develop and maintain skills. Improve efficiency of national innovation system by strengthening public and private sector actors and the interactions between them. Become one of the world’s most innovative economies and societies. Improve research evaluation, international and inter-regional cooperation, human resources and transfer of R&D results to industry. Strengthen Denmark’s position as a knowledge-based society that produces, attracts, disseminates and utilises knowledge. Boost the success of business and society via innovation, entrepreneurship and expertise. Promote social and economic development by constructing a legal framework that is conducive to innovation, attracting R&D, enhancing the protection of intellectual property, and increasing resources for innovation in SMEs. Strengthen S&T efforts to underpin Iceland’s cultural and economic position in an internationally competitive environment and secure continued high living standards and quality of life for Icelanders. Promote R&D to become an innovation-driven economy; improve competitiveness; remain attractive for FDI; maximise social cohesion. Boost economic effects and social benefits of intellectual assets. Transform the nation into a science- and technology-based society Improve the overall competitiveness of the economic sector by strengthening the science base and raising overall R&D investment levels. Improve competitiveness and innovation of companies.
Canada Czech Republic Denmark Finland Hungary
Knowledge, Innovation and Internationalisation Government Programme 2002-06; Medium-Term Economic Policy Programme
Iceland
Ireland Japan Korea Luxembourg
S&T Basic Plan
Mexico
Special Programme of Science and Technology Science Budget 2004; Innovation Letter
Netherlands
New Zealand
i3 Challenge
Norway
From Idea to Value: A Plan for a Comprehensive Innovation Policy
Poland
Knowledge, Computerisation, Competitiveness: Poland on the Way to a Knowledge-based Economy Slovak Republic National S&T Policy to 2005
Spain
National Plan for Scientific Research, Technological Development and Innovation
Sweden Switzerland
Promotion of Education, Research and Technology; Action Plan for Promotion of Innovation and Entrepreneurship
United Kingdom Science and Innovation Investment Framework
© OECD 2004
Focus and concentration, knowledge that promotes economic activity, human resources and quality; set out a rolling agenda of steps for government to take to strengthen the innovative ability of the Dutch business sector. Define national needs, strengthen long-term research capabilities and extract greater commercial value from research. Become one of the most innovative countries in the world, where resourceful and creative enterprises and people are given opportunities to develop a profitable business. Develop science and research potential; build the Polish Research Area as a part of the European Research Area; prepare and implement regional innovation strategies; promote the information society. Ensure long-term co-ordination of national S&T policy with other policies; create conditions for raising S&T to levels of comparable EU countries by 2005; create conditions for international S&T co-operation; increase the efficiency of R&D. Develop the Spanish science-technology-enterprise system; improve enterprise competitiveness; focus on citizen services, improvement of social welfare and knowledge generation. Integrate parts of industrial policy and of research policy; increase commercialisation of university research. Update teaching structures; increase research activities; promote innovation; Intensify national and international co-operation; strengthen education, research and technology; further entrepreneurship; enhance science-industry relationships; learn through international benchmarking. Retain and build world-class centres of excellence; improve responsiveness of publicly-funded research; increase business investment in R&D; strengthen supplies of scientists, engineers and technologists; ensure sustainable and financially robust universities and public laboratories; boost public confidence in and awareness of scientific research.
51
OECD Science, Technology and Industry Outlook 2004
Ireland established Science Foundation Ireland as a statutory body in 2003 and by mid-2004 had committed EUR 320 million in support of basic research in two strategic areas: biotechnology and ICT. In developing its second Science and Technology Basic Plan, Japan’s strategic decisions on R&D priorities were based on the objectives of enhancing intellectual assets and boosting economic and social benefits. Japan has placed science and technology at the core of regional development by establishing intellectual clusters (being implemented in 15 regions in 2003) and co-operative research and innovation projects (in 19 regions in 2002 and 9 regions in 2003) which encourage co-operation among industry, academia and government in local areas. In 2003, the Korean government placed science and technology at the top of the policy agenda with a view making Korea a science- and technology-based society. The policy goal is to make another leap in national development. To this end, the government has established a framework for science, technology and innovation policies and programmes. The major features of the policy framework include strengthening S&T capability, ensuring efficient and balanced allocation of resources, and encouraging the participation of civil society and private industry in the S&T policy-making process. Mexico’s 2001-06 Special Programme of Science and Technology defines general guidelines for developing science, technology and innovation. It establishes three main strategic objectives: i) to have a state policy on science and technology; ii) to increase scientific and technological capacity; and iii) to improve the competitiveness and innovativeness of companies. In the Netherlands, the government that took office in June 2003 identified education, research and innovation as important pillars of policy aimed at stimulating the Dutch economy. This resulted in the allocation of additional funds during a period of general retrenchment in public spending, the drafting of a policy paper on innovation (Innovation Letter) and the establishment of an Innovation Platform with representatives from all the actors of the Dutch national system of innovation. The White Paper on science policy, Science Budget 2004: Focus on Excellence and Greater Value, sets out policy initiatives, with the following main themes: i) focus and concentration; ii) knowledge that promotes economic activity; iii) human resources; and iv) quality. In February 2003, New Zealand launched the i3 Challenge, a major policy initiative focused on defining national needs, strengthening long-term research capabilities and extracting greater commercial value. The catalyst for this initiative was stakeholder consultation through the 2002 Research, Science and Technology (RS&T) Directions Forum, an annual event that provides a platform for a wide range of stakeholders to identify issues and suggest improvements to the RS&T system. The Norwegian government launched in October 2003 a national policy plan, “From Idea to Value – A Comprehensive Innovation Policy”. It addresses general framework conditions for innovation and focuses on five R&D-related topics: i) raising Norway’s total R&D investments (as percentage of GDP) at least to the OECD average by 2005; ii) pursuing increased quality and internationalisation of Norwegian research; iii) stimulating R&D investments by industry; iv) promoting commercialisation of research findings; and v) fostering better interaction between knowledge institutions and the business community. Spain’s new National Plan for Scientific Research, Technological Development and Innovation (2004-07) has been approved. The public R&D budget for the first two years is EUR 9.2 million, after which it will be subject to revision and verification that its initial targets have been met. The plan aims not only to raise enterprises’ technological and innovative capacity but also to promote an innovative business community and better public-private interaction. New aims of the plan are to: i) improve coordination with science, technology and innovation policies of regional governments; ii) implement new fiscal measures to boost support for R&D and innovation in the private sector; iii) improve Spain’s position in the international arena; iv) monitor and evaluate the plan’s programmes and actions; and v) improve science culture in society. 52
In 2002 Sweden initiated a process to set up a new innovation policy to deal with the so-called Swedish paradox of slow long-term economic growth despite high R&D spending, primarily by industry. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
A new strategy for innovation policy calls for integration of parts of industrial and of research policy. The Prime Minister, the Minister of Education and Science, and the Minister of Industry, Employment and Communications argued for an improved innovation system as a way to increase economic growth. One aspect of the debate concerns the commercialisation of university research and how to increase it. The results of a technology foresight exercise had considerable influence on the debate on future priorities concerning investments in higher education and research and resulted in the directing of major efforts to research in biotechnology and information technology. The Swiss parliament accepted education, research and technology as a priority field for government policy and agreed to an above-average increase in financing. As a complementary measure, the Federal Department of Economic Affairs launched an action plan to stimulate innovation and entrepreneurship, highlighting four main topics: i) strengthening education, research and technology; ii) furthering entrepreneurship; iii) enhancing science-industry relationships; and iv) learning through international benchmarking. The United Kingdom continues to invest heavily in research and training of university students, ensuring that funding is allocated to research of the highest quality. It is committed to ensuring that science plays its full role in supporting innovation through the exchange of knowledge between the
Box 2.1. S&T policy in South Africa In 2002, South Africa developed the National Research and Development Strategy (NR&DS) and the Research and Development Strategy, which represent major milestones in creating an enabling environment for the country’s national system of innovation. The new R&D strategy rests on three pillars: i) innovation; ii) human resources for science, engineering and technology; and iii) creating an effective government S&T system. The NR&DS is the key innovation strategy to address the “innovation chasm”, i.e. the gap between research and products and services created from technologies developed through such research. The strategy involves the establishment and funding of technology missions critical to promoting economic and social development. Like many OECD countries, the South African government has set a target of doubling its current investment in science and technology (from 0.7% of GDP to about 1.1%) over a three-year period. The priority technologies include biotechnology, ICT, manufacturing technology, technology to leverage knowledge and technology, to add value to natural resource sectors, and to reduce poverty. In addition to establishing the Department of Science and Technology as an entity separate from the previous Department of Arts, Culture, Science and Technology, South Africa plans to create a comprehensive performance management system for all government-owned laboratories and institutions. Government supports private R&D and innovation mainly through four programmes: i) Technology and Human Resources for Industry Programme (THRIP); ii) Support Programme for Industrial Innovation (SPII); iii) Innovation Fund; and iv) Poverty Relief Programme. THRIP aims to contribute to the increase in the number and quality of people with the appropriate skills to develop and manage technology for industry and to promote increased interaction among industry researchers and technology managers. The SPII was initiated in 1993 to promote technology development in manufacturing industries through support for innovation of competitive products and processes. The SPII has three schemes: the Matching Scheme, the Feasibility Scheme and the Partnership Scheme. The Poverty Reduction programme deals with encouraging science councils and tertiary institutions to transfer technology to communities, as well as to provide business training and mentorship. Because the South African science and technology system faces the problem of an ageing and shrinking scientific population and needs to increase the numbers of young people choosing science as a career, there is a special focus on increasing the number of women and persons from previously disadvantaged communities who enter and remain in the sciences. The South African Agency for Science and Technology Awareness was established to help improve public understanding of science. Its mandate is to stimulate public debate and provide factual information on various issues in science and technology. For women and disadvantaged communities, the CREST Research Project on Gender Equity in Science and Technology, the Distinguished Woman Scientist Award, and Women Scientist Scholarships were implemented. 53
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
science base and both business and the community. In its Science and Innovation Investment Framework 2004–2014, the United Kingdom identifies the attributes of a successful science and innovation system for the nation and the policies it will set in place to make progress against these goals.4 As part of the process of developing future policy, the UK government intends to maintain an on-going dialogue with business and the private non-profit sector. Its efforts are based on the belief that science, technology and innovation are central to meeting the challenge of raising productivity and improving welfare. Changing institutional frameworks for innovation policy To increase the efficiency of national innovation systems, many countries have modified their institutional structures for developing and implementing science, technology and innovation policies and in some cases have implemented new legislation to do so. The main aims are to better co-ordinate policy making and implementation, reduce bureaucracy in universities and public research organisations, strengthen links between scientific research and socio-economic concerns, and connect research policy better to industrial development. Such reforms have led to changes in ministerial structures or responsibilities, the establishment of inter-ministerial working groups, or the creation of new advisory committees that involve stakeholders from outside government to provide additional perspectives on policy needs. New institutional structures Changes in institutional structures for science, technology and innovation policy have resulted in some cases from explicit attempts to consolidate responsibility for related policy areas under a single institutional umbrella as a way to improve co-ordination or to reflect the higher priority being given to these fields. In other cases, they reflect changes in government and a reshuffling of responsibilities. In Denmark, responsibility for universities, research and innovation policy, and ICT policy has been given to the Ministry of Science, Technology and Innovation. In addition the government has begun to reform the entire public research and innovation system, via the Act on Technology and Innovation and new laws developed for the Danish National Research Foundation and government research institutions. In Poland, the Office of the State Committee for Scientific Research became the Ministry of Scientific Research and Information Technology in April 2002, with a typical ministerial structure. The Act on Scientific Research Financing is to be implemented in 2004. These reforms aim to make the Polish research sector more open, more flexible and more eager to use opportunities created by accession to the EU and the influx of foreign investments into the industrial sector. In Belgium, the new development plan of the Brussels-Capital Region recognises for the first time the major role of R&D as an essential vector for economic growth. A new legal framework was put in place to guide regional developments in science, technology and innovation policy, which is now administered by a new institute for the encouragement of scientific research and innovation. It is supported by a new agency in Brussels: a “one-stop shop” to encourage the development of enterprises by guiding them through the services they need. In Flanders, both the Minister for Education and the Minister for Economy were formerly responsible for research, which is now under the responsibility of a single minister to facilitate the development of an integrated policy. In 2004, the Austrian federal government proposed a new Research Funding Reform Act to Parliament. It proposes to set up a new funding agency to bring together major organisations that have previously operated separately.
54
In Ireland, government elections in April 2002 resulted in the transfer of the science, technology and innovation portfolio from the Minister of State (a junior minister) to the Tánaiste (deputy Prime Minister) and the Minister for Enterprise, Trade and Employment. Spain had a Ministry of Science and Technology for four years (2000-04), but early in 2004, after a change in government, the ministerial structure was changed and the Ministry of Education and Science has taken responsibility for scientific research, technological development and innovation policy, together with university education. A newly created Ministry of Industry, Tourism and Commerce has responsibility for strategic actions for the © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
renewal or promotion of industry in disadvantaged sectors and in areas such communications and information society (formerly under the Ministry of Science and Technology), as well as tourism and commerce (previously under the Ministry of Economy). Korea’s president has moved to strengthen the role of the Ministry of Science and Technology as the central agency for inter-ministerial co-ordination of S&T policy and R&D activities, while reducing its involvement in the execution of R&D programmes. He also announced that the Minister of Science and Technology would be named a deputy prime minister to give him/her full responsibility for allocating government R&D funding. Improving co-ordination In addition to restructuring ministries, OECD countries have taken steps to improve co-ordination among ministries involved in science, technology and innovation. In Luxembourg, the government set up in 2003 an inter-ministerial working group with members of the Ministry of Culture, Higher Education and Research, Ministry of Economic Affairs, Ministry of SMEs, and Ministry of Work and Employment to design a co-ordinated multi-year action plan in the spirit of the European Commission’s Action Plan, More Research for Europe. In the United Kingdom, the Prime Minister has asked the Secretary of State for Trade and Industry to chair a ministerial team to lead the innovation agenda across government and drive the implementation of the Department of Trade and Industry’s (DTI) Innovation Report.5 Other countries have expanded such co-ordinating bodies to include stakeholders from outside government. The Netherlands, for example, has created a national Innovation Platform, chaired by the Prime Minister and encompassing leading figures from research and industry, as well as the Ministers for Education, Culture and Science and for Economics Affairs. Similarly, Norway established a ministerial committee chaired by the Ministry of Trade and Industry for the development and coordination of innovation policy. It has also set up a forum consisting of ministers, the business community and other key players to improve co-operation between public authorities and private players with a view to policy design and implementation. New Zealand has actively encouraged a whole-of-government approach to policy development and the formation of new collaborations among stakeholders. A recent example is the emergence of the Science Enterprises Group, which represents a broad cross-section of research, science and technology providers: Crown Research Institutes, universities and industry research associations. Advisory councils Several countries have created new advisory councils to provide input into science, technology and innovation policy making. While some consist only of government officials, many include representatives of industry and the research community. Austria has established a new Science Council to advise the minister about the future development of the public universities. In Belgium, the French Community has a new council for science policy, so that all the Belgian authorities now have their own council. In April 2002, the Mexican Congress approved the National Council on Science and Technology’s (Conacyt) Organic Law and modified the way Conacyt operates so that it can fulfil more efficiently the objectives of the Science and Technology Bill (Ley de Ciencia y Tecnología, LCyT). In 2003, Hungary established the Science and Technology Policy Council as the top-level science and technology policy-making and co-ordination body. It is presided by the Prime Minister with the aid of a Science and Technology Policy Advisory Body, composed of highly respected representatives of science and industry. At the operative level, the National Office for Research and Technology (NORT) was created in December 2003 as the primary policy-making institution for research, development and innovation. The Research and Technological Innovation Council, a body composed of representatives of both the public and private sectors, essentially serves as a board for NORT and a counsel for developing the government’s R&D strategy. In Iceland, new legislation took effect in April 2003, establishing the Science and Technology Policy Council under the Office of the Prime Minister and authorising public support to scientific research via the Ministry of Education, Science and Culture and to technological development via the Ministry of Industry and Trade. The Council is composed of five ministers and 14 additional members. Its two © OECD 2004
55
OECD Science, Technology and Industry Outlook 2004
subcommittees, the Science Board and the Technology Board, both draw nine members from the 14 non-ministerial members of the Council. The resulting overlap of four members on the two committees is intended to ensure a strong policy link between science and socio-economic concerns, including support to innovation. In order to incorporate the interests of industries into national S&T and R&D policy processes, the Korean government includes leaders from industry in the membership of the National Science and Technology Council, which governs S&T policy and government R&D resource allocation. Industry also participates in the management of government research institutes by its presence on the boards of the research councils that are responsible for the operation of government R&D organisations. The government encourages industry participation in national R&D programmes. Research proposals involving industry are given preferential treatment in the funding process. Other efforts involve the creation of public/private partnerships and regional clusters. Increasing public R&D expenditures Consistent with the higher priority given to science, technology and innovation, OECD countries have substantially increased publicly funded R&D, despite persistent budget constraints and overall reductions in government funding in some countries. Several countries have established explicit targets for public expenditure on R&D and taken preliminary steps to achieve them. Such targets reflects the growing recognition of the linkages among R&D, innovation and economic growth and more widespread attempts to use science and technology policy (e.g. R&D funding policy) to meet economic objectives. Among EU countries much of the increase in R&D spending reflects the aim to increase R&D expenditures to 3% of GDP by 2010 (Barcelona objective). For example, the Austrian federal government committed to raising R&D to 2.5% of GDP in 2006. Austria’s R&D expenditures were 2.19% of GDP in 2003 and estimated to reach 2.27% in 2004. Ireland’s gross expenditure on R&D is currently 1.4% of GNP, and its goal is to achieve 2.5% of GNP by 2010. Public-sector funding of research in Ireland is rising at about 5% a year in real terms. Spain’s target for R&D expenditure, according to the National Plan (2004-07), is to reach 1.22% of GDP in 2005 and 1.40% of GDP by 2007. The plan also has a target of 2.1% of GDP for innovation expenditures in 2005 and over 2.5% of GDP in 2007. Although the Luxembourg government fully endorses the Lisbon strategy and the Barcelona objective, no specific target has been set so far. Other EU countries have also boosted public R&D funding. Denmark has allocated funds for further public-sector investments in knowledge and science. The budget for 2003 and 2004 allocates supplementary appropriations of just under DKK 7.4 billion for university programmes, research, ICT and innovation for 2003-07. The United Kingdom has set a target to increase R&D intensity from the current level of 1.9% of GDP to 2.5% by 2014. In keeping with this objective, the Science and Innovation Investment Framework announces the government’s intention to increase investments in the public science base at least as fast as the trend growth rate of the economy between 2004 and 2014 and increasing science spending as a proportion of GDP. The Framework calls for the public science budget to increase 5.8% a year (in real terms) during the period from 2004-05 to 2007-08. Eastern European countries that joined the EU in May 2004 also anticipate growing R&D spending. In the Czech Republic, the ratio of government R&D expenditures to GDP is expected to increase from 0.58% in 2004 to 0.60% in 2006. Poland’s ambition is to boost R&D spending to 1.5% of GDP by 2006 and reach 3% in 2010, of which two-thirds from the private sector, in accordance with the Barcelona target. Outside of Europe, OECD countries have also achieved significant increases in public R&D funding, in some cases linked to specific spending targets:
56
• Australia has increased R&D expenditure via the BAA initiative. BAA funding is phased, with AUD 193 million in 2001-02, AUD 419 million in 2002-03, AUD 634 million in 2000-04, and AUD 1 billion in 2005-06. R&D funding has been extended through the follow-up package to BAA, Backing Australia’s Ability – Building Our Future through Science and Innovation, at over AUD 1 billion a year until 2010-11. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
• Canada increased overall public funding for R&D by 8.7% from 2002-03 to 2003-04. Since 1995, spending on R&D has increased steadily from just over 2% to just over 3% of total government expenditures. To support Canada’s research base, the government in its March 2004 budget again increased the permanent budgets of Canada’s three federal granting councils: the Natural Sciences and Engineering Research Council (NSERC); the Canadian Institutes of Health Research (CHIR); and the Social Sciences and Humanities Research Council of Canada. • Japan raised the total amount of government R&D spending by some JPY 24 trillion from FY2001 to FY2005 so that spending as a share of GDP would remain equivalent to that of leading European countries and the United States. The rise was based on the assumption that government R&D investment should be 1% of GDP, requiring a nominal growth rate of 3.5%, during the period of the Second Basic Plan. • The Korean government set a target to double national R&D investment between 2001 and 2007 when the term of the current government ends. • In Mexico, one of the most important commitments of the current administration is to increase R&D spending from 0.4% of GDP in 2001 to 1% in 2006. To achieve this goal, the public sector will need to maintain the spending increments earmarked for this activity during the next few years, and private spending must increase. • In the United States, the government budget for R&D climbed from USD 83.8 billion in 2000 to USD 118 billion in 2003. It is projected to rise to USD 126 billion in 2004 and USD 132 billion in 2005. The largest increases have been in the R&D budgets of the Department of Defense and the National Institutes of Health, which saw growth of USD 19 billion and USD 9 billion, respectively between fiscal years 2000 and 2003. The National Science Foundation received an additional USD 1 billion in R&D funds. Prioritisation of public R&D expenditures Increases in R&D funding have not been evenly distributed across scientific and technological fields. Most countries have identified a limited number of priority sectors to receive above-average amounts of new funding because of their anticipated leverage in terms of future economic growth, employment and overall social value. While there are variations, the broad areas receiving the most attention are ICT, biotechnology and nanotechnology (Table 2.2). In some cases, funding for priority areas is tied to national innovation strategies. Austria’s priority research areas are emphasised in its National Plan for Research and Innovation, and the Hungarian government’s National Development Plan for 2004-06 identifies seven scientific areas for priority funding. Australia’s priority areas are outlined in its National Research Priorities and the aims of the Backing Australia’s Ability initiative. These are areas of particular social, economic and environmental importance to Australia, and areas in which a whole-of-government focus has the potential to improve research and broader policy outcomes. State and territory governments also play an increasingly important role in establishing research infrastructure and related industry clusters in fields such as biotechnology, ICT and resource processing. In the United Kingdom, research council funding reinforces cross-council priorities, which include stem cells (GBP 40 million), a sustainable energy economy (GBP 28 million), and rural economy and land use (GBP 20 million), as well as continued investment in existing priorities for post-genomics and proteomics (GBP 246 million), e-science (GBP 213 million) and basic technology (GBP 104 million), which were established in 2001-02. Funding of priority areas is also linked with new funds and funding instruments. The Danish government proposed in 2004 the establishment of a Future Fund for Danish investments in prosperous high-tech areas, such as biotechnology, nanotechnology and ICT. In Mexico, 14 sectoral funds began operating in several areas of applied research and technological development (e.g. health, communications, environment, housing, agriculture and economic development) and for the advancement of knowledge more generally. The Cabinet of the Netherlands has introduced more than 30 knowledge infrastructure projects, funded from natural gas revenues. These projects (to be carried © OECD 2004
57
OECD Science, Technology and Industry Outlook 2004
Table 2.2. Science and technology priorities in OECD countries Priority fields of science and technology
Australia
Environmentally sustainable Australia; Promoting and maintaining good health; frontier technologies for building and transforming Australian industries; safeguarding Australia.
Austria
Life sciences; ICT; nanosciences and micro technologies; mobility, transport, space and aeronautics; environment, energy and sustainability; social sciences, humanities, and cultural studies.
Czech Republic
Embryonic cell research.
Denmark
Biotechnology; nanotechnology; and ICT.
France
Research for health; development of renewable energy; resource management (water and food); diffusion of knowledge and promotion of scientific culture.
Germany
ICT; microsystems engineering; optical technology; materials research; clean processes and production technologies; biotechnology; nanotechnology.
Hungary
Material science, production engineering and equipment; energy; transport; electronics, measurement and control technology; biotechnology; environmental protection; and ICT and its applications.
Iceland
Environment; ICT; and nanotechnology.
Ireland
Biotechnology; and ICT.
Japan
Life sciences; ICT; environment; and nanotechnology and materials.
Korea
Digital TV and broadcasting; displays; intelligent robots; new-generation automobiles (intelligent car, clean car, etc.); next-generation semiconductors, next-generation mobile communication; intelligent home-networks; digital content and solutions; next-generation batteries; and biomedicine (bio-chips, artificial organs, etc.).
Mexico
ICT; biotechnology; materials; design; and manufacturing processes. In addition, sectoral funds have been established for applied research and technology development in areas such as health, communications, environment, housing, and agriculture.
Netherlands
Life sciences and genomics; nanotechnology; and ICT.
New Zealand
Biotechnology; ICT; and creative industries.
Norway
Marine research; medical and health research; ICT; energy and environment; functional genomics; and new materials (i.e. nanotechnology).
Spain
Chemistry; materials (including nanotechnology); industrial design; quality of life (including biomedicine and biotechnology); space; physics; information society; social sciences and humanities; security.
United Kingdom Stem cells; sustainable energy; post-genomics and proteomics; e-science; and basic technologies. United States
Inter-agency priorities include: homeland security; networking and information technology; nanotechnology; priority areas of the physical sciences; biology of complex systems; climate, water and hydrogen.
Source: OECD, based on national sources.
out by public-private consortia) are mainly in the fields of life sciences and genomics, ICT and nanotechnology. For its part, Norway created a fund with income from its petroleum sector in 1999; interest is used to fund long-term basic research in general and in four priority areas: marine research, medical and health research, ICT and energy and environment. Special funding has also been allocated to functional genomics and new materials (i.e. nanotechnology). In Germany, new funding programmes have been established for fields that are of vital importance for the future (e.g. biotechnology, genome research, laser technology, ICT, nanotechnology), and funding rules have been published.
58
Priorities have also influenced the allocation of government funding across research performers. In Ireland, the volume of research has grown much more rapidly in the university sector than in the public research laboratories. A marked shift from applied research related to natural resources towards basic research, industrial technologies and, in particular, towards biomedical and healthrelated research and development can be seen over recent decades. In New Zealand, in the period 2002-03 to 2003-04, there have been significant shifts in funding between research providers, with both universities and other organisations (such as research associations, research consortia and private-sector science companies) increasing their share of funding at the expense of Crown Research Institutes (CRIs). © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Strengthening public sector research and public research organisations Public sector research plays an important role in national innovation systems. It not only develops new knowledge which can be used to stimulate innovation in the private sector and help to improve health and security and meet other social objectives, it also contributes to the training of scientists and engineers, promotes development of innovation networks and specific technologies, and supports diffusion of technology, especially to small actors. As the role of R&D and innovation in creating growth and jobs in the knowledge-based economy has become more pronounced (OECD, 1998), governments have taken various steps to improve the quality and efficiency of public science systems, including changes in governance structures, funding mechanisms and links to the private sector. The aim of these changes is to increase flexibility and autonomy, provide greater transparency and less bureaucracy, improve the quality of public research and the ability to contribute to economic growth and other social objectives. Changes in legal status Even as OECD countries take a more strategic approach to innovation policy and introduce more top-down priority setting for research, they are working to provide universities and other public research organisations with greater autonomy. Such changes are seen as steps towards increasing their flexibility, transparency and efficiency and enabling them to collaborate more with industry. A key step in such reforms is to change the legal status of universities and other public research organisations to make them independent legal entities. Denmark, Japan and the Slovak Republic have introduced such reforms in recent years. Responding to an OECD review of its university system in 2002, the Danish Parliament passed a new University Act in 2003 making all universities independent public foundations regulated by law and supervised by the Minister for Science, Technology and Innovation. Inspired by European-wide university reforms, the Danish reform replaces centuries of collegiate governance with boards constituted by a majority of external members appointed independently of government. A central aim of the governance reform is to strengthen external relations and to make exchange of knowledge with business and society a central mission of universities. Based on a review, the Danish government also presented in 2003 a reform of its government research institutions, which would include a new Act on Government Research Institutes. The Act would make institutions independent of the relevant ministries with regard to management and would subject their research to continuous, independent evaluation based on uniform and recognised principles. The aim of such reforms is to strengthen research and ensure better interaction between universities and government research institutions. Japan also transformed its national universities into national university corporations in April 2004. The change was intended to enhance the independence of university management and enable more flexible human resource management, as faculty are no longer considered civil servants. Japanese reforms also extend to certain research institutions. These organisations are being transformed into incorporated administrative agencies, which are legal entities without government status. The aim is to replace a priori government interventions and controls with ex-post reviews to the extent possible and to ensure flexible, effective and transparent administration to meet citizens’ needs. Agencies are expected to raise transparency through ex-ante evaluation of plans submitted, ex-post evaluation of accomplishments, and disclosure of pay standards and financial statements. In addition, agencies can promote R&D through newly adopted, more flexible financial and personnel systems. Japan inaugurated the National Institute of Advanced Industrial Science and Technology (AIST) as an Incorporated Administrative Agency in April 2001, unifying 16 research institutions under the Ministry of Economy, Trade and Industry (METI). The Slovak Republic has privatised its public research sector, with some research institutes no longer receiving funding directly from the government budget, but via contracts and grants from government ministries. The structure of the Slovak Academy of Sciences was also modified, and some of its institutes were privatised. The main goals of privatisation were to decrease financing from the state budget and increase the efficiency of R&D institutions. In the university sector, the newly © OECD 2004
59
OECD Science, Technology and Industry Outlook 2004
approved Act on Universities transformed universities and higher education institutions (apart from those belonging to the Ministry of Interior and the Ministry of Defence) into independent, not-for-profit organisations with a view to new forms of management and performance review that would allow universities to better utilise their resources. In Spain, universities are autonomous, but depend administratively on regional governments. A new law of 2002 changed university governance structures to increase the involvement of social organisations and regional administrations. A system of quality assurance and performance evaluation has been implemented. New funding models: more project-based funding Across the OECD, the structure of funding of universities and other public research organisations has shifted in recent years away from institutional block grants and towards project-oriented grants and contracts.6 The underlying driver of this trend is the desire to stimulate competition and co-operation among research centres while maintaining their legal independence, and the goal is to encourage public institutions to seek external funds based on their capability to meet users’ needs. Notable changes have been made in the financing structures of the German Helmholtz Association Laboratories and the Hungarian Academy of Sciences: • In Germany, the federal government, the Länder (federal states) and the research centres themselves agreed to a reform of the Helmholtz Association in 2001. The core element of the reform is programme-based funding of Helmholtz Association labs. This means that the work of the centres focuses on research programmes which are evaluated on a regular basis and that the distribution of funds is based on the evaluated programmes rather than the centres. This allows priority setting for the Helmholtz Association as a whole and stimulates competition and cooperation among centres. Under this new procedure, the federal government and the Länder determine a research policy framework for the research fields, while the centres develop the scientific subjects jointly, although on a competitive basis. • Hungary has also reformed its funding structure for public research. Today only 60% of the income of the Hungarian Academy of Science is guaranteed from public sources (block grants); the remaining 40% has to be generated from competitive government programmes or other sources. This has also led to a shift in the type of research performed. Formerly described as an institution doing nearly exclusively basic research, the Academy now claims to be involved in a number of applied programmes together with industry. Other countries are taking similar steps. The Danish reform of government research institutes, introduced in 2003, requires public research funds to be distributed in more open competition. In Iceland, the first major policy recommendation of the Science and Technology Policy Council, in its policy statement of December 2003, was to increase the volume of competitive funding. Korea has been reducing institutional block funding to encourage public institutions to seek external funds based on their ability to meet users’ needs. New Zealand also allocated approximately 90% of funds (with the exception of non-specific output funding) on a fully contestable basis in the period 2002-03. Luxembourg is an exception to this general trend: from 2004, the financing of public research centres has moved from an essentially project-based financing system to a broader approach that includes institutional financing.
60
In the United Kingdom, which has already seen a shift toward more project-oriented funding, efforts have been made to enable universities to manage research funded from a diverse set of sources. The Transparent Approach to Costing, a system of activity-based costing, is being implemented across the sector. Recognising the range of funding sources and stakeholders, the UK government has also established a Funders’ Forum to bring together all parties with an interest in the long-term sustainability of the university research base (charities, industry, universities, funding councils, research councils, regional development agencies and government departments) to take a strategic overview of the working of the science base. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Facilitating interaction with industry In many OECD countries, interaction between public research organisations and industry is an area of continuing significant reform. All OECD countries seek to strengthen industry-science relationships, and a key policy area is the management of IPR in public research organisations. In recent years, countries have passed legislation requiring universities and other public research organisations to transfer technology to the private sector and have begun to put in place the regulatory framework to enable a variety of transactions, including the creation of spin-off companies and licensing of intellectual property rights. In Japan, which implemented the Law for Promoting University-Industry Technology Transfer in 1998, there were 36 technology licensing organisations for national and private universities as of December 2003. Mandating technology transfer In some countries, new legislation puts more pressure on universities and public research organisations to transfer technology to the private sector. Denmark’s new University Act, for example, makes knowledge and technology transfer an integral part of universities’ charters. The new Act on Technology Transfer promotes the transfer of knowledge and technology from public research institutions to trade and industry, including the creation of new science-based enterprises. This allows Danish universities and government research institutions to found and invest in commercial companies for the purpose of technology transfer. Dutch universities are also required to promote spin-offs from scientific research. The Minister for Education, Culture and Science wants to emphasise this by highlighting the underlying law (Higher Education and Scientific Research Act) and designating which part of universities’ research funding should be used for valorisation.7 In its 2002 Act on Universities and Colleges, Norway gave universities and colleges new responsibilities for co-operating with industry and working actively for the dissemination and use of their research results for industrial purposes. In the revised law of the federal institutes of technology (ETH), Switzerland also added the use of knowledge and public relations to the mission statement. Luxembourg encourages interaction between industry and its first full university, the University of Luxembourg, whose founding principles, as set out in October 2003, call for: i) interdisciplinary cooperation; ii) symbiosis between teaching and research; and iii) international co-operation. The university will develop and exploit basic, applied and technological research that will be implemented through research projects on a contractual basis with other research institutions and with industry. Special emphasis will be put on mobility of students and researchers, which can further stimulate industry interaction. In the United Kingdom, the government will agree on targets for knowledge transfer with each of the Research Councils. In some cases, governments are making available additional funding to support the efforts of universities and public laboratories to transfer technology to industry. In Canada, the March 2004 Budget allocated CAD 50 million over five years to Industry Canada for a pilot competitive fund aimed at promoting commercialisation of federally funded research at universities, research hospitals and granting councils, as well as CAD 25 million for a similar pilot competitive commercialisation fund, over five years for federal research labs. The United Kingdom plans to boost funding for the Higher Education Innovation Fund (HEIF) to GBP 110 million by 2007-08, up from GBP 80 million in 2001. The HEIF is a joint effort of the Higher Education Funding Council for England and the UK Department of Trade and Industry that supplements existing grants schemes for universities’ education and research activities with special funding to increase their responsiveness to industry and their ability to contribute to economic growth and competitiveness. Changing ownership of IPR Other recent legislative reforms affect the ownership of IPR resulting from publicly funded research. In January 2003, Norway amended the Act on the Ownership of Inventions made by Employees by repealing the so-called exception for teachers. Rules on ownership of inventions made © OECD 2004
61
OECD Science, Technology and Industry Outlook 2004
by researchers employed at universities and state colleges became, with a few remaining exceptions, the same as for employees in other establishments. The institutions now own the IPR, but researchers retain the right to publish their results, even if publication harms patentability. Researchers receive assistance from their institutions for the exploitation of an invention to allow them to concentrate more on research and teaching. The institution must, for its part, ensure that the rights of both the researchers and the institution are safeguarded and that inventions are patented and made available to commerce and industry. Any income resulting from the inventions should be distributed between the institution and the researcher. It is recommended that the income be distributed equally among the institution, the researcher and the research group. Other countries have taken similar steps. The Icelandic government has presented a bill to amend laws regarding employee inventions with a view to inducing further use of knowledge to economic advantage and to encourage universities and research institutes to register patents more frequently. With the revised law of the federal institutes of technology, Switzerland set clear rules for IPR: ownership of intellectual property (except copyright) arising from work within the federal institutes of technology belongs to the respective organisations. Researchers get an appropriate share of the profits arising from commercialisation. The revised law also gives organisations the right to take interests in private firms that commercialise their research results. Finland is preparing new legislation on university IPR to clarify the situation regarding ownership and the economic benefits for the partners concerned. Guidelines for IP management Short of implementing legislative changes, several countries have developed national guidelines for intellectual property (IP) management. In 2001, Australia developed a set of national principles for best-practice IP identification, protection and management by researchers and research institutions. The principles are incorporated into all funding agreements administered by the Australian Research Council and the National Health and Medical Research Council. Under the principles, research institutions are required to have: policies aimed at ensuring that commercially valuable research is recognised by researchers and identified by the research institution; policies to ensure that valuable IP is protected against premature public disclosure or inadequate laboratory records; a clear and appropriate policy regarding employee and student entitlement to IPR; procedures to guide researchers in assessing existing IP in the field; procedures for reviewing the commercial potential of IP and for advising its creators; policies which recognise the rights and needs of all stakeholders involved in the research which define how those stakeholders benefit from the exploitation of the IP; and policies regarding potential conflicts of interest. In April 2003, the Irish Council for Science, Technology and Innovation (ICSTI) issued a statement, “Utilising Intellectual Property for Competitive Advantage”, which reviewed the technology practices of several countries and recommended a code of practice to support the identification and exploitation of intellectual property. In April 2004, ICSTI published the National Code of Practice for management of intellectual property arising from 100% publicly funded research. Its aim is to build on existing knowledge and expertise and to harmonise IP management systems across public research organisations. It provides guidelines and a framework for commercialisation of public investment in Irish R&D. Public research organisations are encouraged to adopt the Code to ensure robust, harmonised IP management systems. In addition, a new fund, “Intellectual Property Protection Fund for the Higher Education Sector”, was launched in 2004 to supplement existing support in the sector. Under the scheme, an institution can seek support for patent protection relating to discoveries and inventions for which it has identified sufficient commercial potential to justify the expense of patenting.
62
To strengthen their technology transfer activities, organisations have formed networks for identifying and sharing good practices. The technology transfer offices of Swiss universities, of universities of applied sciences and of the federal institutes of technology have founded an association (SwiTT) to enhance knowledge exchange, to educate those working in technology transfer and to improve framework conditions for technology transfer. In order to exploit the potential of universities’ © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
patents and licences, the Austrian government, all universities and other relevant organisations have developed “Uni:Invent”, which supports the activities of innovation scouts who give universities advice aimed at better commercialisation of IPR and will finance patenting costs. Institutional evaluation A desire to increase the quality of public research and education, as well as to enhance the efficiency of public research funding, has led to renewed emphasis on the evaluation of public research organisations in many OECD countries. This has resulted in the establishment of new institutions and requirements and guidelines for conducting an evaluation. In Austria, for example, the newly established Austrian Quality Assurance Agency helps universities to implement evaluation cycles and develop evaluation standards for research, education and training. Evaluation of the main funding body for academic research (the FWF) serves as a basis for the current reform. Such evaluations are an integral part of a new organisational framework for Austrian public universities, implemented in 2004, that allows them greater autonomy and requires more formal evaluation of their activities and output (education and research). Norway has introduced a series of reforms to strengthen the evaluation of universities, with a view to improving the quality of higher education. The reforms are linked to a new results-oriented funding model for higher education institutions introduced in budget year 2002. The main indicators for evaluation include: i) completed student credits; ii) number of graduates (beginning in 2005); iii) number of international exchange students (in and out); iv) funding from research co-operation within the EU and from the Research Council of Norway; and v) number of higher academic positions (e.g. professors) and scientific publications (beginning in 2006). As part of the plan, the Norwegian Agency for Quality Assurance in Education (NOKUT) was established on 1 January 2003 as an independent state body to monitor the quality of Norway’s higher education institutions by means of accreditation and evaluation. Similar approaches are taken in France, Luxembourg and Switzerland. In France, each research establishment is dependent upon the results of both internal and external evaluation. France uses the f ollo win g in dicat or s in its e va lua t ion s of public r ese ar ch o rg a nisa ti ons: st r uct ur ing of research, intellectual property, contract research, enterprise creation, entrepreneurship, and service expertise. Since 2003, Luxembourg’s public research centres have to provide annually a set of commonly agreed performance indicators that measure productivity and socio-economic contribution. These quantitative and qualitative indicators take into account the different missions of the centres. In Switzerland, to underpin and promote the quality of teaching and research at universities, the Centre for Accreditation and Quality Assurance (OAQ) of Swiss universities was founded in October 2001. Its tasks are to develop guidelines and quality standards for academic accreditation in Switzerland, to perform the accreditation of public and private institutions as well as programmes at university level, and to draw up recommendations for quality assurance at universities. The Netherlands also seeks to use evaluation to improve accountability and quality control in its public research sector. A meta-evaluation committee monitors the quality of analyses of research results and the way in which conclusions and recommendations are acted upon. The science community – the Association of Dutch Universities (VSNU), the Research Council (NOW) and the Royal Academy of Arts and Science (KNAW) – have agreed with the Minister of Education, Culture and Science to determine research quality through a system in which peers compare Dutch research groups with foreign counterparts. Developments can be expected in other OECD countries. The Belgian Federal Minister for Science Policy supported the publication of a White Paper by the directors of the federal scientific institutes which focuses on steps to promote the quality of the services of federal scientific institutes and to restructure their management to achieve greater efficiency. In Iceland, the notion of formal evaluations of programmes and institutions is somewhat underdeveloped; it has been introduced into the educational system at primary and secondary level but not at tertiary level as yet. Interest in strengthening the position of universities as research organisations led the Science and Technology © OECD 2004
63
OECD Science, Technology and Industry Outlook 2004
Policy Council to recommend systematic evaluation of research carried out by universities and to link institutional appropriations to research performance. Methods for evaluation and monitoring of quality in research are under development in a evaluation of scientific effort at the University of Iceland. Support for business R&D and innovation Business enterprises are the main source of innovation. They combine technological and organisational knowledge to produce new and better products, processes and services. They also play the primary role in funding and performing R&D in most OECD countries and are strongly influenced in their choice of technological strategies by conditions in their home countries (Porter, 1990; Nelson, 1993). Although OECD countries vary widely in their attitudes towards government involvement in business R&D and innovation, the general trend in recent years has been towards increasing the scope and intensity of programmes to boost business R&D and innovation through a variety of policy instruments, primarily direct public funding of business R&D and innovation, tax incentives for R&D, and support for entrepreneurship. Other programmes have also been established (see Box 2.2). For the most part, indirect support for business R&D is supplanting direct grants and loans, but new programmes of various types have been introduced in recent years.
Box 2.2. Forms of public support for business innovation In addition to financing of business R&D, tax incentives and support for entrepreneurship, OECD countries have introduced a range of other programmes aimed at stimulating business innovation. A few examples are reviewed below. Most aim at building competence for innovation and innovation management within firms or providing access to necessary infrastructure. Australian government programmes such as Commercialising Emerging Technologies (COMET), the New Industrial Development Program (NIDP) and Building IT through Strengths (BITS) provide support to increase the commercialisation capacity of firms, including by developing skills and building networks and supply chains. In addition, the government promotes innovation and business competitiveness through initiatives to increase access to technologies and raise awareness of the benefits of innovation, entrepreneurship and commercialisation within the community. The National Innovation Awareness Strategy (NIAS) is a five-year initiative to raise awareness in the community and in SMEs of the importance and benefits of innovation, entrepreneurship and science. The Innovation Access Programme (IAP) aims to promote innovation and competitiveness by increasing access to global research and technologies and facilitating their uptake by Australian researchers and companies. In Belgium, the Flemish community established three new business services centres in 2003. They are designed to respond to the needs of business in three areas: software, geo-informatics, and mechatronics. A specialised centre for automotive technologies is expected to be added. The 2003 budget included EUR 30 million for the three centres. The centres will be financed for five years, after which they are expected to find alternative sources of funding. In 2003, the Icelandic government established the IMPRA Innovation Centre, which offers advisory support for innovation and technological development. An important function of the centre is to establish co-operation among the public bodies that comprise the support network for innovation. Its principal task is to shape and operate support projects for SMEs and individuals, particularly for new entrepreneurs who undertake new business ventures. A special effort is made to encourage women entrepreneurs. While Japan’s technology and R&D levels are high, it lacks technology managers. The establishment of management of technology (MOT) courses in universities, etc., is urgently needed. METI has established the “Entrepreneurship Promotion Programme” to solicit proposals for MOT development programmes (course offerings, teaching materials and case study materials) from universities, graduate schools and other educational institutions and to develop, test and evaluate such programmes in co-operation with industry. The Ministry of Education, Culture, Sports, Science and Technology (MEXT) also promotes support programmes for MOT and/or intellectual property experts at universities. 64
© OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Direct public funding Most OECD countries continue to provide some form of direct support for business R&D and innovation, with the objective of improving economic competitiveness. 8 New direct financing programmes, including grants and loans, increasingly require matching contributions from programme participants, but this requirement is not universal, especially in countries with limited industry financing of business R&D. Improvements to existing instruments are typically aimed at increasing the additionality effects of the government contribution – increasing the amount of additional business R&D performed as a result of government financing (so-called input additionality) and at influencing firm R&D strategy (also known as behavioural additionality). Other reforms aim to streamline programmes and create better synergy between research and innovation. In Australia, the main source of direct government funding for business R&D is currently the R&D Start programme, which provides grants and loans on the basis of competitive proposals from all sectors. It will be merged into the new Commercial Ready programme introduced under the revised and expanded Backing Australia’s Ability initiative. Targeted assistance is also available through various sector initiatives including: the Automotive Competitiveness and Investment Scheme, the Food Industry Innovation Scheme, and the Pharmaceuticals Partnership Programme for business R&D. Canada also has a number of programmes to stimulate business R&D in specific technology areas. In February 2003, the Medical and Related Sciences (MaRS) project was announced; it was founded by leaders from Canada’s academic, business and scientific communities to fuel the commercialisation of medical research. The federal government has also provided CAD 30 million for a new Canadian Photonics Fabrication Centre that has been set up in Ottawa to contribute to the development of a world-class photonics technology sector. In Luxembourg, the main instrument for co-financing industrial research is the framework law on economic development and diversification, which provides a clear R&D incentive scheme. To stimulate the development of R&D, it provides for co-financing of investments in R&D that are of general economic interest and are performed by private-sector industries and research centres. In addition, the SNCI9 (Société nationale de crédit et d’investissement) provides loans to finance expenditures related to R&D projects whose aim is to introduce new products and services or develop new production and marketing processes. These loans have a fixed interest rate that is below the current market rate. The Mexican government supports private-sector R&D and innovation through mixed funds with state and municipal governments. These funds are set up with contributions from the private, academic and governmental sectors, in proportions determined for each project. Their goal is to advance scientific and technological activities and strengthen regional and local research and development capabilities. Mixed funds have been operating since 2001; to date, 26 mixed funds and one municipal fund have been set up. Recent reviews of innovation policy have prompted reforms in the Netherlands and the United Kingdom. After several critical evaluations, the Netherlands began at the end of 2002 to restructure its innovation policy instruments to minimise overlap, increase transparency and accessibility and make them more responsive to a changing market environment. The outcome has been a significant reduction in the number of instruments, better co-ordination between relevant ministries, a shift toward generic instead of sector-specific innovation programmes, and greater R&D co-operation between companies and public research organisations. Following the recent DTI Innovation Report, the United Kingdom is developing and implementing a business-focused Technology Strategy and associated Technology Programme, which helps businesses to extract technologies in priority areas from the United Kingdom and international academic base by providing funding and sharing risk in taking new technologies to the market. The Technology Strategy will have funding of GBP 178 million by 2007-08. It takes a more strategic approach to the spending of government money on knowledge transfer, focusing on technologies with wide potential applications across business sectors. Iceland has also streamlined its innovation programmes. The Technology Fund of the Icelandic Research Council (RANNÍS) was merged with the Science Fund under the 2003 law, and the demarcation in funding criteria between basic research and applied research was removed. Its mission is to support © OECD 2004
65
OECD Science, Technology and Industry Outlook 2004
technological development and research to support innovation in the Icelandic economy. The New Business Venture Fund (NBVF) provides early-risk financing to the private sector. Eastern European countries have established a number of new programmes to boost business R&D. The Czech Republic now has three programmes to support business R&D: i) POKROK, which supports emerging technologies and manufacturing processes and systems and is integrated in the National Research Programme under the Ministry of Education Youth and Sports; ii) TANDEM, which supports industry-oriented research; and iii) IMPULS, which supports innovation, development and industrial research. Research project costs are shared between participating private companies and the state. Hungary established the Research and Technological Innovation Fund in November 2003 to promote demand-driven innovation and knowledge-based competitiveness and encourage redistribution of private-sector resources towards innovative activities with the help of matching public funds. The Fund is financed by small, mandatory contributions from almost all companies registered in Hungary; these are matched by the government. Firms’ own R&D expenditures (both intramural and sourced from public research organisations) can be deducted from the contribution; in effect, innovative companies may be exempt. Fund resources are spent through competitive awards that are intended to benefit the private sector directly or indirectly; at least 25% of the funding is allocated for regional innovation purposes. The Slovak Republic has three state R&D programmes that provide grants to private firms: Development of Progressive Technologies for Efficient Economy, Implementation of Progressive Principles of Production and Energy Transformation, and Utilisation of Domestic Raw Materials and Resources. More favourable tax treatment of business R&D R&D tax concessions are extensively used by OECD countries as an indirect way of encouraging business R&D expenditures, on the understanding that R&D expenditures have benefits that cannot be fully appropriated by the investing firms, making them reluctant to invest in socially optimal levels of R&D. Recent years have seen the introduction of new tax incentive schemes, as well as changes in existing schemes to make them more generous. While many existing tax incentive programmes reward incremental increases in R&D investment (based on various formulas), a number of new incentives are based on the level of R&D spending in a given year (Table 2.3). Special tax incentives have also been introduced for SMEs or specific technological sectors. Even in countries that do not have specific tax incentives for R&D (e.g. Germany, Iceland, Luxembourg), reduced corporate tax rates have lowered tax burdens on firms and may have encouraged greater spending on R&D. Table 2.3. R&D tax incentives in OECD countries, 2004 Level of R&D
66
Increment of R&D
Additional incentives for SMEs
R&D tax credits
Canada (20%) France (5%)1 Japan (10%-12%) Korea (7% on facilities) Mexico (30%) Netherlands (13%) Norway (18%) Portugal (20%)1 Spain (30%)1
France (45%)1 Ireland (20%) Korea (40%) Portugal (50%)1 Spain (50%)1 United States (20%)
Canada (35% of level) France2 Italy (30% of level) Japan (15% of level) Korea (15% of level, 50% of increment) Netherlands (40% of level) Norway (20% of level)
R&D allowances
Australia (125%)1 Austria (125%)1 Belgium (113.5%) Denmark (150%) Hungary (100%-300%) United Kingdom (125%)
Australia (175%) Austria (135%)
Belgium (118.5% of level) Denmark (150%) United Kingdom (150% of level)
1. Tax incentive is based on a combination of level of R&D investment and incremental increase in R&D investment. 2. France has a generous tax system in place for young, innovative firms. Details are provided in the text. Source: OECD, 2004, based on national sources.
© OECD 2004
Recent Developments in Science, Technology and Innovation Policies
New tax incentives for R&D Between 2002 and 2004, Belgium, Hungary and Ireland introduced new tax schemes for increasing private-sector R&D expenditures. Belgium’s federal government decided in 2004 to offer tax credits to firms collaborating with universities or not-for-profit organisations for their research. Hungary introduced a 100% tax allowance for research and technology development that also applies to subcontracted R&D activities if the partner is a public or not-for-profit research organisation; the allowance increases to 300% if the company’s R&D lab is located at a university or public research site. Hungary also introduced a 150% corporate tax allowance for donations to foundations supporting R&D activities and allows tax-free employment of students up to HUF 53 000 per month (equal to the official minimum wage). Ireland’s new tax incentive system was introduced in 2004 and provides a credit of 20% for incremental or new R&D spending. Norway and the United Kingdom have extended their tax incentive schemes to large firms as well as SMEs. Norway established a tax deduction scheme for R&D in SMEs in 2002 and redefined it to cover all companies in 2003. The scheme covers projects carried out either by the firm or in co-operation with an authorised research institution. Foreign firms may receive tax deductions if they are subject to taxes in Norway. Firms with fewer than 250 employees continue to enjoy higher deductions than other firms (20% versus 18%), and annual limits on qualifying expenses per firm continue to make the scheme more favourable to small firms. The United Kingdom extended its scheme to all firms in 2002, after implementing an allowance for SMEs in 2000. The new scheme provides a 125% allowance on R&D expenditures (compared with a 150% allowance for SMEs), including firms’ expenditures on R&D carried out in collaboration with universities or public research organisations. Changes to existing schemes Many countries that have tax incentives for R&D made them more generous in recent years. Under its revised and expanded Backing Australia’s Ability initiative, for example, the Australian government has maintained its 125% R&D tax concession programme and has extended initiatives to encourage business expenditure on R&D: a tax offset to assist small companies,10 a 175% premium tax concession for additional R&D, and effective life treatment of R&D plant expenditure. In Austria, the system of tax concessions for R&D was broadened in 2002 and 2003 to provide more generous incentives. Firms are now entitled to deduct up to 25% of total R&D expenditures and up to 35% of incremental R&D expenditures from their taxable income. In addition, a tax bonus can be granted if the firm does not generate profits (e.g. in the case of many start-ups). The Japanese government modified its tax incentive system in 2003 to allow a deduction of between 10% and 12% of total R&D expenditure; the precise percentage is determined by the ratio of R&D expenditure to total sales volume, which is seen as a way of encouraging companies to increase their R&D intensity. In Mexico, the tax incentive was changed in 2001 from a 20% tax credit on eligible incremental expenditures on R&D to 30% of total R&D expenditure, regardless of size or industrial sector. The Dutch government plans to increase the budget for its wage-based R&D tax incentive system (WBSO) by 30% or EUR 100 million between 2004 and 2006.11 The total budget of WBSO will amount to EUR 450 million in 2007. In France, the 2004 budget law made several changes to its R&D tax credit scheme. It is now based on both volume and incremental expenditures, 5% and 45%, respectively, rather than on increment only. Second, the definition of eligible expenditures has been broadened to include costs of defending patents and monitoring technology (veille technologique). Third, R&D contracts with universities and public research institutes can be included for double their actual amount. Finally, the ceiling for the tax credit that an individual enterprise can claim has been increased from EUR 6.1 million to EUR 8 million. France also created a new scheme for innovative, young firms that meet several criteria: they must be less than eight years old, employ fewer than 250 workers and devote at least 15% of their total expenditures to R&D. Such firms are exonerated from taxes on their profits for three years, followed by a 50% exoneration for the next two years. In addition, as long as they qualify as young, innovative companies, they are exonerated from several other taxes. In spring 2002, the Danish Parliament decided to grant firms a 150% deduction on sponsorships of research at universities and government research institutions. To give SMEs an additional incentive to © OECD 2004
67
OECD Science, Technology and Industry Outlook 2004
participate in such activities, the action plan, “Turning Science into Business”, calls for them to receive a 150% deduction on their own research expenses when participating in a collaborative project with a public research institution. Spain, which by various measures already has one of the most generous tax incentive systems among OECD countries, modified the system’s administration in 2003 to make it easier for firms to use, with a view to increasing participation. A streamlined procedure has been set up to improve framework conditions and guarantees for companies investing in R&D or innovation. The former Ministry of Science and Technology was authorised by the tax administration to certify the eligibility of firms’ research, technological development and innovation projects for the tax incentive system. Previously, the tax administration had to verify eligibility. Lowering corporate taxes Some countries have also taken steps to reduce corporate tax rates in order to allow firms to allocate more resources to R&D. In its 2001 and 2003 budgets, for example, the Canadian government introduced a number of measures to benefit technology-based businesses, particularly SMEs: i) the amount of income subject to the 12% small business tax rate has been increased from CAD 200 000 to CAD 300 000 over four years; ii) the threshold for access to enhanced Scientific Research and Experimental Development tax credits has been lowered; and iii) the range of renewable energy and energy-efficiency equipment eligible for accelerated tax write-off has been considerably expanded. The March 2004 budget further improved the tax treatment of technology-based industry, particularly the ICT sector, by increasing capital cost allowance rates for computer equipment from 30% to 45% and for broadband and Internet infrastructure from 20% to 30%. The fiscal cost of these two measures is estimated at CAD 365 million over the next two years. Icelandic authorities have in past years worked towards simplifying tax rules and lowering tax percentages so that firms retain a higher share of their income, which can be used for R&D. The corporate income tax in Iceland has been lowered in recent years from 53% to 18%, and a flat tax rate of 10% is applied to capital income. The current taxation levels have met with generally favourable approval from the business community, and companies have decided to expand their international operations from an Icelandic base rather than move abroad. In Luxembourg, innovative firms benefit, under certain conditions, from three types of tax incentive measures, none of which is specific to R&D and innovation. In 2002, the tax level for companies decreased from 30% to 22% to help firms maintain their competitiveness. Protecting intellectual property To provide firms with healthy business environments, several OECD countries have strengthened the patent system and introduced patent awareness-raising programmes. For example, the Czech Republic harmonised its patent law with EU standards by setting up a new Act on Patent Attorneys and is now negotiating a new decree on the existing Trademarks Law Act. Luxembourg introduced the online registration of patents and copyright to facilitate and speed up the patent and copyright registration process. In December 2003, the Norwegian Parliament voted to transpose the EU Patent Directive into national law, mainly by amending the Patent Act. The main thrust of the adopted amendments is to make it clear that, in principle, biotechnological inventions are patentable in Norway like any other type of inventions, albeit with certain exceptions and special rules. The United Kingdom has developed a new national strategy for dealing with IP crime. The Netherlands is considering lowering annual fees and possible implementation of a differentiated patent system to address sector-specific needs. Stimulating entrepreneurship
68
Entrepreneurship is widely seen as an important element of business innovation. Technology-based start-ups are key vehicles for transferring knowledge from universities and public research organisations to the private sector, commercialising the results of public research and bringing innovative ideas to market. Although small firms are an important part of national economies, in particular in terms of © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
employment, they are limited, compared to large firms, in their ability to access technological expertise and mobilise resources for innovation. Therefore, OECD countries have not only introduced preferential programmes for SMEs in almost all national R&D and venture capital programmes, they have also set up dedicated programmes to stimulate entrepreneurship and assist SMEs. Support for venture capital A key factor in the commercialisation of research outcomes is the availability of early-stage investment capital. To induce venture capitalists to invest in projects to transform research outputs from universities or public research organisations into commercial ventures, OECD countries have intensified support for venture capital in several ways: allocating more funds to venture capital, especially for SMEs or technology-based start-ups; providing tax incentives to non-resident investors; and forming partnerships with private venture capitalists. Australia has introduced a range of programmes to increase access to venture capital, including the Venture Capital Limited Partnerships (VCLP), the Innovation Investment Fund (IIF), the Pooled Development Funds (PDF) and the Renewable Energy Equity Fund (REEF). The VCLP programme provides for the registration of limited partnerships as VCLPs and is designed to increase the supply of venture capital to Australian companies by providing tax incentives to non-resident investors in Australian venture capital. The IIF is a venture capital programme that involves investment in nine private-sector venture capital funds to assist technology-based SMEs in the early stages of development to commercialise the results of Australian R&D. The PDF programme is designed to increase the supply of equity capital for growing SMEs. The REEF programme is a specialist renewable energy equity fund based on the Innovation Investment Fund (IIF) model. It provides venture capital (equity) to assist SMEs to commercialise R&D in renewable energy technologies. In Belgium, to facilitate access to venture capital for SMEs and start-ups, the Flemish government adopted the ARK decree (Activation of Risk Capital) and, at the same time, launched an ARKimedes Fund, which is fed by institutional investors and the general public. As a result, citizens can benefit from fiscal allowances. In addition, both the Walloon and the Flemish Regions have set up “one-stop shop” organisations to facilitate access to the various possibilities for venture capital. Enterprise Ireland, an agency of the Irish government, has formed a series of partnerships with private-sector institutions, corporations and venture capitalists to establish new venture capital funds to invest in Irish SMEs and to encourage growth and development of Ireland’s venture capital sector. The Business Development Bank of Canada (BDC) has invested in hundreds of companies and has many times gone through the full venture capital cycle of seeding, nurturing and harvesting. In 2003, the BDC venture capital portfolio stood at over CAD 430 million, with an objective over the next five years of reaching the CAD 1 billion mark. In the February 2003 budget, the government made an additional investment of CAD 190 million in BDC to provide additional equity financing for knowledge-based and export-oriented businesses, and to increase the financing available to women entrepreneurs. The March 2004 budget allocated a further CAD 250 million to the BDC to augment pre-seed and seed funding, specialised venture capital and risk capital for innovative start-ups and early-stage companies. The German government has established a new joint venture capital fund of funds of the European Recovery Program (ERP) special fund and the European Investment Fund (EIF) that will invest in German venture capital funds for early-stage and growth companies together with private investors. Both partners will provide a total of EUR 500 million over five years. Including the contributions from private investors, up to approximately EUR 1.7 billion will be available to innovative, growth-oriented firms in Germany. The government is also examining the possibility of launching a seed fund for R&Dbased start-ups. It would be designed to ensure sufficient financing opportunities in the early stage of a start-up in which private investors (venture capital funds, etc.) have not yet made any commitments. The United Kingdom has a number of targeted interventions to support the development of venture capital and thus to address perceived financing gaps. Regional venture capital funds have been set up across the country. They are investing GBP 270 million in SMEs with growth potential, backed by GBP 80 million of government funding. The Early Growth Funding Programme complements the regional © OECD 2004
69
OECD Science, Technology and Industry Outlook 2004
funds by providing smaller amounts of risk capital for start-up and early-stage businesses. There are similar arrangements in Scotland and Wales. The government also supports the UK High Technology Fund – a fund of funds – which supports early-stage high-technology businesses across the United Kingdom. R&D funding for small firms Dedicated support for R&D in SMEs has been growing. The Canadian budget of February 2003, for example, provided for a permanent funding increase of CAD 25 million a year to the Industrial Research Assistance Programme (IRAP) of the National Research Council, which provides industrial technology assistance to Canadian SMEs.12 New Zealand provides grant assistance primarily to technology-aware SMEs to undertake R&D projects that have the potential to stretch their technological capability. From July 2002 to June 2003 a total of 231 grants were approved for a total value of NZD 14.8 million. In Finland, SMEs and new technology-based firms have for some time been a special concern of Finnish innovation policy. Tekes’ efforts to develop business, marketing and internationalisation competencies in SMEs are usually embodied as standard features in conventional Tekes financing instruments. The efforts are bearing fruit: in 2003 almost a quarter of the client firms of Tekes were new start-up companies. 13 The same year, SMEs received 58% of Tekes’ R&D financing. Between 1998 and 2002, the German government increased the sums made available to SMEs to promote R&D by 32% to about EUR 732.5 million, and there has been a significant shift of emphasis in favour of SMEs in specialised programmes based on cross-sectoral technologies. The number of medium-sized companies supported by the Ministry of Education and Research (BMBF) rose by 50% to about 1 700 over the past six years. Under a number of programmes, which include biotechnology and production research, SMEs today receive the bulk of all funds to promote R&D. Preferential financial support for SMEs Several new programmes provide financial support to SME. The Czech-Moravian Guarantee and Development Bank helps SMEs obtain access to financial capital and shares their business risk via a scheme of bank guarantees, preferential loans and specific subsidy programmes. The Danish government’s Danish Growth Fund (VækstFonden) supports Danish companies by financing R&D. The fund advances loans to development projects and grants financial aid to pre-projects. Set up in 1992, the fund has allocated a total of DKK 2 billion to Danish companies, plus DKK 284 million in relation to a bank loan guarantee scheme for firms with fewer than 50 employees that are unable to obtain loans through the traditional banking system. In 2002, Hungary established the SME Development Finance Co. (KVFP) with EUR 13 million in equity. KVFP’s mission is to invest in profitable SMEs with clear and realistic development plans, good management and significant growth potential. France provides public support to business incubators; between 2000 and 2003, the government, in partnership with the EU and regional and local authorities, provided EUR 25 million to 31 incubators that nurtured 900 projects, created 520 innovative firms and about 1 800 jobs. The programme was evaluated in 2003. The German government has set up the Innovation and Future Technologies in the SME Sector Hightech Master Plan to remove obstacles to the establishment and growth of young innovative companies and to ensure financing conditions that encourage their growth. Other forms of assistance
70
Countries are also experimenting with other forms of integrated support for innovation in SMEs. In Australia, one of the main sources of support for SMEs is the Innovation Access Programme to promote innovation and competitiveness by increasing Australian access to global research and technologies, and facilitating their uptake by Australian researchers and companies. Other programmes that assist SMEs to increase their innovation capacity building, by building management skills and awareness, include the Commercialising Emerging Technologies programme and Information Technology Online (ITOL) Programme, which encourages industry (especially clusters of SMEs) to adopt business-tobusiness e-commerce solutions and embrace innovative e-commerce solutions that deliver sustainable economy-wide returns and increase competitiveness. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Korea has expanded technical and financial assistance for SMEs and new start-ups by introducing new policies to accept technology (knowledge assets) as collateral for bank loans, to provide SMEs with subsidies for employing R&D personnel, and to furnish SMEs with technical information and services. The Mexican government has several programmes to assist SMEs. The Compite Programme is designed to improve the competitive position of micro-enterprises and SMEs. The Technological Services Information System (SISTEC) helps to build technological awareness among micro-enterprises and SMEs and provides them with information on the services provided by Applied Research and Technological Development Centres and Institutes. Mexico also promotes technological innovation via the AVANCE programme,14 which provides support for researchers, entrepreneurs, companies and research institutions wishing to transform their discoveries and scientific and technological developments into successful businesses. The AVANCE programme supports various types of projects but gives preference to the following fields: information technologies; elect ronics and telecommunications; health (medicine, systems for diagnosis, materials and equipment); agricultural, fishing and food development; advanced materials; sustainable development and environment; energy; design and manufacturing; housing and construction; and attention to poverty and social needs.
Box 2.3. Support to business innovation in China China has been reforming its S&T innovation policy framework in order to develop a more efficient national innovation system and create a more market-oriented approach to encouraging technological innovation. Recent developments include efforts to increase R&D expenditures, actively support private business R&D and innovation, commercialise R&D institutes, develop a regional innovation system and encourage the return of overseas Chinese graduates. China has seen an acceleration of R&D expenditures. Total R&D spending in 2002 reached RMB 128.76 billion – up RMB 24.52 billion (or 23.5%) from the preceding year. To support private R&D and innovation, China has introduced several reforms. First, tax incentives have been introduced. Business firms whose expenditures on developing new products, technologies and techniques attain real growth of 10% or more enjoy a direct reduction of taxes equal to 50% of accrued expenditures. Software and ICT businesses benefit from favourable treatment for value-added tax, income tax and depreciation of production equipment. Second, the National Science and Technology Plan establishes industrial involvement in R&D as an important condition for establishing a priority project. In 2003, the Small and Medium Science and Technology Business Innovation Fund allocated nearly RMB 3.05 billion to support 4 195 projects implemented by SMEs. Third, following the issue of the document “Comments on Establishing a Venture Capital Investment Mechanism”, venture capital has gradually been developed. The issuance of Regulations on the Management of Foreign Investment in Venture Capital Businesses provides more definite policies regarding the establishment of foreigninvested venture capital firms and associated operations. Boosting innovation in the service sector also receives policy attention. The document “Comments on the Policies and Measures to Accelerate the Development of Service Industry during the 10th Five-Year Period”, was issued in 2002. Related to its efforts to improve business innovation, China continues to deepen the reform of R&D institutes to enhance their innovative capacity. At the end of 2002, 1 185 R&D institutes had been converted or were in the process of conversion, an increase of 43 units from the preceding year. The conversion of R&D institutes shows three patterns: notable progress in the industrialisation process, enhanced technical innovation capacity and enhanced technology diffusion capacity. Related to efforts to strengthen co-operation and networking among innovation institutes, China has promoted regional innovation systems through experiments in regions such as the Yangtze River Delta and the Pan Pearl River Delta. National technology transfer centres and campus science and technology parks have been promoted in order to enhance collaboration between universities and industry and to transfer technology. In order to attract overseas Chinese graduates back to China, the construction of industrial parks for overseas Chinese graduates has accelerated and communication channels between inland and overseas Chinese students have been expanded. 71
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
To improve the climate for technology-based start-ups, the Netherlands introduced the Action Programme TechnoPartner, which combines and streamlines existing initiatives for technology-based start-ups. The programme consists of: the TechnoPartner Seed Facility, the TechnoPartner Subsidy Scheme for Knowledge Exploitation (SKE) and the TechnoPartner platform. The TechnoPartner Seed Facility mobilises the lower level of the Dutch risk capital market by stimulating small business investment companies (SBICs). These private companies finance start-ups and small firms. Private parties can establish an SBIC and have their capital matched by government loans. The SKE aims at encouraging the use of scientific knowledge by high-technology start-ups both outside and in universities and research institutions. These institutions can, when operating in a public-private consortium, request a subsidy for a high-technology start-up. The task of the TechnoPartner platform is to foster awareness of high-technology entrepreneurship in the Netherlands and take stock of problems and bottlenecks related to high-technology start-ups. The Danish government issued an action plan on entrepreneurship in January 2003, focusing on innovative and high-technology entrepreneurs. For the first time, the plan viewed entrepreneurship as an integral part of the commercialisation of research. Its goal is to develop a strong and coherent infrastructure for commercialisation. The action plan was followed by the establishment of a ministerial commission to look into the general culture of entrepreneurship in Denmark. This included discussions of the culture of entrepreneurship and commercialisation specifically at universities and research institutions. The role of the Danish Academy of Entrepreneurship, established in 2004, is to strengthen the availability of education in innovation and entrepreneurship in the educational system. It is expected to be the centre of activities regarding entrepreneurship and will be the driving force to improve the educational system’s capacity to provide the right framework for encouraging students to become more entrepreneurial. Enhancing collaboration and networking among innovating organisations It has been widely recognised in recent years that the effectiveness and efficiency of innovation systems are determined to a considerable extent by the degree and quality of linkages and interactions among different actors, including firms, universities, research institutes and government agencies. The potentially wide-ranging impact of innovation networks and co-operative interaction has received increasing attention in many OECD countries. Networking, intensified co-operation and technology diffusion within innovation systems among firms, research organisations, universities and other key stakeholders remain a key priority area in government innovation policy. Public/private partnerships for research and innovation Public/private partnerships (P/PPs) have been widely used by OECD countries to improve the performance of national innovation systems. The last two years have seen a stronger focus on the contribution to commercial outputs and a number of existing P/PPs have been expanded. For example: • Australia’s Cooperative Research Centre (CRC) programme15 will see its budget increase to AUD 192 million in 2004-05, and to AUD 259 million in 2005-06. The programme supported 71 centres in 2003-04. Following a full evaluation of the CRC programme in 2003,16 changes were made to the guidelines for the 2004 CRC selection round. From 2004, the government will provide an additional AUD 65 million over six years from 2005-06 for CRCs with a stronger commercial focus. • Austria is currently revising its Competence Centre programmes in order to improve their effectiveness in creating new structures for science-industry co-operation. A mid-term assessment of the programmes has recently been completed and constitutes a basis for a number of decisions on the future of P/PPs.
72
• In Sweden, the Competence Centres Programme is a long-term effort to strengthen the link between academic research groups and industrial R&D in the Swedish innovation system. In 2004, the programme will be extended with new Competence Centres that specialise in areas of working life and transport. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
In addition, several new partnership programmes were established: • The Czech Republic launched a joint R&D programme “Research Centres – B” to promote cooperation between the state research sector and industrial companies, hospitals and other users of research results. • A new Irish initiative is the Centres for Science, Engineering and Technology funded by Science Foundation Ireland. These centres fund scientists who develop internationally competitive research clusters allied to industry through collaborative efforts. Grants normally range from EUR 1 million to EUR 5 million a year for up to five years. • In Hungary, five Co-operative Research Centres (CRC) started operations in 2001. These are research and engineering centres located at major universities. Their objective is to develop technological partnerships and networks involving institutions of higher education, other not-forprofit research institutions and the business sector, in particular SMEs. • In 2001, Switzerland set up a new instrument for research promotion, the National Centres of Competence in Research (NCCR). To date, 14 centres have been established. For 2004-07, an additional CHF 30 million will be provided to finance five or six new NCCRs. While the above P/PPs all take the form of research centres, a number of countries have begun developing looser, network-style P/PPs. In Belgium, the federal government launched in 2002 a programme of technological poles of attraction to create networks of academic laboratories, collective research centres and, eventually, federal scientific establishments. The objective is to consolidate scientific and technological capabilities in specific areas of competence, which to date include telecommunications for the information society, standardisation and space. A budget of EUR 5.3 million has been allocated for a three-year period. Denmark has launched a Technology Network scheme to support business enterprises and knowledge institutions to establish knowledge networks at regional, national and international levels. These networks are to promote long-term collaborative partnerships between different stakeholders – business enterprises, universities, government research institutions, approved technology service institutes, centres for tertiary education and others. The Dutch Cabinet is very much in favour of arrangements under which the knowledge chain, from basic research to innovative products, is steered comprehensively in areas of national importance. In 2001, the Cabinet instituted a steering committee to run the national genomics programme. A similar body for catalysis was set up in 2002, and ICT research will follow in 2004. Industry participates in these steering committees and in the programmes. To encourage R&D collaboration further, the Netherlands introduced in January 2004 Projectmatig Samenwerkingsinstrument, a new project-based collaboration tool. It is aimed at precommercial co-operation on R&D among companies and between companies and the research infrastructure as a set of third-generation instruments for P/PPs on breakthrough technologies like genomics. New Zealand established research consortia as a relatively new investment model in 2002-03, which matches public funds with private-sector investment. These are user-led partnerships between the private sector and public research organisations that are designed to increase private-sector investment in R&D; build enduring relationships between public research providers and the private sector; increase the relevance of publicly funded research to users; and increase the likelihood of that research being commercialised for the benefit of New Zealand. In 2003, Switzerland carried out a pilot study to examine the setting up of an Internet-based technology platform to provide information for private companies on new technologies or specific knowledge, and to foster co-operation and networking between public and private partners. A central objective of the initiative is improvement of technology transfer between public research institutes and private companies and of knowledge transfer between private companies. Another newly introduced platform is www.swissbiotech.org. Its goal is to bring together important actors, such as private companies, public research laboratories, training institutions and organisations that provide financing or public support. Furthermore, the platform serves as an international marketing instrument for Swiss biotechnology. Switzerland also launched one important P/PP project under the government’s information society strategy. With the objectives “ICT to learn” and “learn ICT”, the cantons, the federal government and private firms will work together to increase ICT competencies in schools. © OECD 2004
73
OECD Science, Technology and Industry Outlook 2004
Following its Innovation Review, the United Kingdom expects to launch programmes such as Collaborative R&D and Knowledge Transfer Networks to foster collaboration and networking for innovation, adopting principles from past successful schemes. Knowledge Transfer Partnerships also provide direct support for knowledge transfer by enabling universities and others in the science, engineering and technology base across the United Kingdom to work with businesses using recently qualified graduates who have an academic supervisor, to undertake specific knowledge-transfer projects in firms of all sizes. This builds on the former Teaching Company Scheme (TCS). Successive reviews of TCS confirmed the value to the business of the technology transferred. Promoting regional innovative clusters Because tacit knowledge, which is critical to innovation, is not easy to communicate and obtaining it requires practical experience, learning and interaction are widely accepted to be basic elements of technological innovation (Nelson and Winter, 1982; Rosenberg, 1982). Firm-level innovation increasingly requires active acquisition and exploitation of knowledge from other firms, universities and public research organisations; this favours geographical proximity among learners (Saxenian, 1994). OECD countries have taken the cluster-based approach to regional development and have implemented numerous initiatives in recent years.17 Canada’s National Research Council (NRC), which plays a key role in reinforcing Canada’s system of innovation on the basis of local strengths, is working to tighten links between its research labs and local industry by sponsoring community-level meetings and workshops to allow regional stakeholders to define the existing and potential local technology base and to identify local strengths and weaknesses in the areas of business, financing, research and infrastructure. In addition to reinforcing existing partnerships, these small gatherings provide an opportunity to establish local and national networks. Denmark has modified its approach to regional clusters. From 2001 to 2003 the government supported regional networks that linked companies, educational institutions and other relevant institutions for research, education and knowledge transfer. It established 18 regional networks in different business areas across the country. Since 2003, Denmark has replaced the former initiative (Centre Contracts) with innovation consortia aimed at co-operation on innovative projects between at least two companies, one research institute and one knowledge diffusion organisation (typically a technological service institute). The primary criterion for supporting an innovation consortium is that the research should lead to new products, processes and services and that the project builds competencies that are in wide demand by Danish companies, especially SMEs, in the technological service institutes. Iceland wishes to encourage universities, institutes and firms to work together to create research facilities in areas defined for a common purpose and emphasises that universities and research institutes in regions outside the Reykjavik area should continue to carry out research and technological development in fields well-suited to reinforcing innovation in the local economy and business life of the respective region. Regional support programmes were established for this purpose. New Zealand has a large number of clusters, some embryonic and others that have already achieved international reach. Initiatives are under way via New Zealand Trade and Enterprise (NZTE) to stimulate existing clusters through cluster development and support. Over 40 cluster development initiatives are currently in progress in a range of areas, including biotechnology, optics, nutraceuticals, organics, software, film and wool. NZTE’s Cluster Development Programme provides a total grant of up to NZD 50 000, which must be matched by the applicants and can make available a cluster facilitator to advance the cluster’s development.18 In addition, the Regional Partnerships Programme works with regional stakeholders to put in place the foundations and preconditions for taking advantage of regional economic development opportunities and facilitates the building of regional economic development and leadership capability. The programme has facilitated 26 regional partnerships.
74
As part of Norway’s comprehensive innovation policy plan, the Minister of Trade and Industry has defined several projects addressing particular commercial and industrial sectors under the heading “Innovation 2010”. Some of these projects focus on regional issues, such as the particular challenges of northern Norway or rural districts in central parts of the country. Others focus on the potential in © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
important commercial sectors, such as the public service and the maritime sectors. The intention is to motivate and mobilise individuals, companies, private capital, research institutions and the educational system to focus on opportunities and to foster ideas that can trigger entrepreneurship and commercial activity across the country. Poland is preparing projects for the implementation of its regional innovation strategies, which are among the priorities described in the National Plan of Growth 2004-06. The aim is to foster co-operation between R&D institutions and industry and to strengthen innovation in the regions. In spring 2002, Sweden launched a new programme, VINNVÄXT, to develop strong innovation systems with high-quality environments for R&D and competitive and dynamic regional networks. In each region, the programme promotes co-operation between companies, R&D organisations and the political system with a view to allowing the regions to become internationally competitive in specific growth areas. Human resources for S&T Human resources in science and technology (HRST) are essential to advancing science and innovation and generating productivity growth, but many OECD countries are concerned about future supplies of scientists and engineers. Several countries report waning interest in science and engineering among youth and declines in science and engineering graduates. For example, in Korea, the share of secondary school graduates applying for university-level studies in science and engineering dropped from 42.4% in 1998 to 26.9% in 2002. In Denmark, the number of science and
Box 2.4. HRST and S&T policy in Russia In Russia, the number of HRST has been declining steadily, with the greatest decrease in R&D employment in the higher education sector (22.3% between 1994 and 2002). To attract young people to S&T, the Russian government has established competitive grants for young scientists (under 35 years) and lump-sum payments to supervisors of studies of these young scientists. In addition, Russia increased the official salaries of the principal categories of personnel in budget-funded R&D institutions. Other efforts to improve HRST are linked to overall developments in Russia’s science and technology policy, which is in the midst of reform. Since 1999, the federal budget for R&D has increased regularly, and federal funding for civil R&D in 2002 was 1.74 times higher than in 2000. As a share of GDP, federal funding rose from 0.29% in 2000 to 0.35% in 2002. In March 2002, Russia issued two documents defining national initiatives in the field of science and technology: i) “Basic Principles of the Russian Federation Policy in the Field of Development of Science and Technologies for the Period up to 2010 and Further Perspective”; and ii) a specified list of priority areas of science, technology and engineering. The focus of government S&T and innovation policy in 2002-03 was: i) improving priority support for R&D and specifying priority areas for S&T development; ii) improving the formation and implementation of federal goal-oriented programmes; iii) improving intellectual property legislation; and iv) creating incentives for developing the innovation infrastructure and small innovating enterprises. In terms of private R&D and innovation, intensive efforts were made in the field of intellectual property rights, in preparation for Russia’s entry into the World Trade Organization (WTO). At the end of 2002, amendments were made in the Patent Law of the Russian Federation to harmonise Russian legislation with the most important international treaties on the protection of IPR and the TRIPS Agreement. Direct government support of private R&D was given for 12 major innovation projects of national importance. Financial support for technological development programmes was carried out on the basis of consolidation of funds of the budget, the developer and the manufacturer of final products. To promote stronger industry-science relationships, Russia established six Technology Transfer Centres (TTC) and market-oriented research clusters. A large-scale programme, Biotechnology for Medicine and Agriculture, was set up by four Russian ministries in 2001. It provides government funding at a pre-competitive stage of R&D and for industrial scale-up of results for the manufacture of competitive and high-quality biotechnological products with the assistance of private business. Such programmes are intended to boost Russia’s innovative capacities and may help create further employment opportunities for HRST. 75
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
engineering graduates decreased from 3 929 in 1994 to 3 274 in 2001.19 A number of OECD countries have therefore put in place policies to increase the supply of HRST. These include programmes to increase domestic supply of HRST and to tap into the growing pool of scientists and engineers in other countries, often outside the OECD. Boosting domestic supplies of HRST The first step for many OECD countries has been to build up domestic supplies of HRST. Most of these efforts have focused on increasing interest in science and engineering, financing studies at the graduate and postgraduate level, attracting more women to scientific and technical careers, reforming educational curricula and teacher training, and attracting more scientific and highly skilled personnel from abroad. In a few countries demand-side policies have also been drawn up to stimulate job creation for scientists and engineers. Increasing interest in science and technology OECD countries have implemented a range of policies to raise interest in science and technology. These take two forms: efforts aimed at enhancing public understanding of science and technology generally and specific efforts to attract students to science and engineering studies. The two often operate in a complementary fashion. For example, the Australian government is raising public awareness of the importance and benefits of science to the community and SMEs through the National Innovation Awareness Strategy. Smart Moves, a touring science and innovation outreach programme for secondary school students, provides a number of inspirational case studies of Australian entrepreneurial achievements and promotes the study of science and engineering. Similar programmes to increase public understanding of science have been adopted in various countries. Austria’s programme, which was implemented in 2002, will be continued. Hungary supports related activities through the first competitive proposal scheme based on the resources of the Research and Technological Innovation Fund. Luxembourg has implemented the science festival, the Miniresearch contest and the Science Club. The mission of Switzerland’s “Science et Cité” foundation is to encourage public debate about and with science and to create a climate of mutual trust between scientists and the public. In 2002 and 2003, the foundation focused on an informed debate about stem cells, globalisation and climate change. Several programmes specifically focus on students. Germany encourages young people to participate in the national mathematics and computer science competitions and in the International Mathematical, Physics, Chemical and Biological Olympiads. The research competition Jugend forscht helps to develop young people’s interest in scientific research, mathematics and technology. Iceland has introduced a series of scientist visits to schools and student visits to scientific institutions and institute open-house events. In October 2003 it held a science week of organised events with extensive media coverage, and innovation competition and awards ceremonies are organised annually at all levels of the education system. Japan has designated super-science high schools, model schools for the promotion of science education (the Rika Daisuki School for elementary and junior high school) and has developed advanced digital study materials for science and technology education. The United Kingdom also works with schools to provide a network of local centres for science, engineering, technology and mathematics and an S&E ambassador programme.
76
The Czech Republic and Ireland have established programmes with mixed objectives. The former recently launched the programme Widening Access to Research and Development Results for the General Czech Public to promote public understanding of science and to encourage young people to study technical sciences at universities. Ireland has launched Discover Engineering and Science to raise general awareness of the physical sciences, encourage more students to study the subjects in secondary and tertiary schools, and to pursue careers in this area. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Outreach to women In many OECD countries women represent a sizeable source of talent but remain under-represented in science and engineering. Several countries have introduced measures specifically designed to encourage women to pursue research careers in these fields. The objective of Austria’s f-FORTE programme, launched in 2002, for example, is to increase women’s presence and enhance their career opportunities in science and technology, and includes measures on various educational and professional levels. In Finland, an equality plan adopted in 2000 to promote gender equality in science indicates that the minority gender (currently women) should occupy at least 40% of all research posts. Ireland’s Women in Technology and Science (WITS) initiative promotes their participation in science, engineering and technology, and its Gender Equality Unit in the Department of Education and Science works to create awareness of gender equality among all stakeholders in the Irish education system. Korea has also launched a Women into Science and Engineering (WISE) programme and requires public research institutes to increase the proportion of woman scientists and engineers to at least 25% of total employees. In 2000, the Swiss University Conference published a federal programme on equal opportunities for men and women at universities; its main objective is to double the number of female professors at Swiss universities by 2006. To improve the number of female research personnel in higher ranks at Dutch universities, the Dutch Research Council (NOW) runs the Aspasia programme, which has already operated since 2000 and will be continued. It has led to a significant increase in female assistant professors. In 2005 EUR 1.5 million will be made available for the programme, and funding will be raised to EUR 2 million annually from 2006. In addition, countries such as Iceland and the United Kingdom have introduced programmes to encourage more female students to enter higher education in natural science, engineering and technology. The United Kingdom has found that proportionately fewer women study for pre-university qualifications in chemistry and physics. Hence, in addition to working with children of school age and projects such as SPARK magazine to counter gender stereotypes and inspire girls to study science, engineering and technology, the UK government plans to work with employers through a new Resource Centre for Women as a part of the new strategy published in 2003.20 Reforming curricula and training Interest has also grown in reforming educational curricula for science and engineering to make them more relevant and in making teaching more effective through improved teacher training. Hungary has a plan to upgrade higher education curricula to better match the specific needs of companies and other knowledge users, including promotion of inter- and multidisciplinary training and increased emphasis on subjects important for the knowledge-based society and economy (e.g. ICT and computing). Following the recommendations of the Roberts’ Review, 21 the United Kingdom is implementing measures to improve education standards for scientists and engineers, to modernise curricula to develop practical understanding of science, to recruit more people to science teacher training courses, and to allocate significant funding for better-quality science labs. Korea has been encouraging universities to improve curricula to reflect the changes in knowledge and skills required in industrial fields. In Ireland, the Task Force on the Physical Sciences (in its report of March 200222) examined the decline in interest in the physical sciences among young people and put forward a comprehensive set of recommendations on issues such as curriculum reform and teacher training to address the problem: implementation is under way. In Austria, the Innovations in Mathematics, Science and Technology Teaching initiative aims at contributing to a lasting improvement in the quality of mathematics and science teaching in both general and vocational schools for the 15-19 age group. Schools will receive support for their efforts to improve their teaching quality. Students will be given opportunities for independent learning, problem-solving, building arguments and critical assessment of their own performance. Science in Your School is an academic programme conceived, co-ordinated and implemented in 2002 by a group of Mexican scientists who are members of the Mexican Academy of Science. Their objective is to improve the attitude of basic and middle education teachers to mathematics and science and to bring them up © OECD 2004
77
OECD Science, Technology and Industry Outlook 2004
to date on new findings in these disciplines. The programme brings scientists and teachers into closer contact to raise the teaching level of science and mathematics in primary and secondary schools. Norway, in 2003, started new education programmes in some universities for teachers in mathematics and sciences. Financial support for science and technology studies Financial support is a key element of efforts to attract and retain science and engineering students, especially at graduate levels. OECD countries support research training programmes and postdoctoral fellowships and are expanding them where possible. For example, the Australian government invests in postgraduate research and researcher training through a number of schemes, such as the Research Training Scheme, Australian Postgraduate Awards Scheme, International Postgraduate Research Scholarships Scheme, and the Australian Research Council’s (ARC) National Competitive Grants Programme. The government has also increased financial support for a variety of postdoctoral fellowships for early-career researchers to develop appropriate research skills: ARC Discovery Projects, the National Health and Medical Research Council’s People Support grants, the Commonwealth Scientific and Industrial Research Organisation (CSIRO) Postdoctoral Fellowships, and the ARC Linkage programme. Austria invests in postgraduate research and researcher training through a number of schemes, such as the DOC programme for PhD students, the APART programme, Schroedinger fellowships, Buehler fellowships, and the START programme for post-docs. Korea has a National Research Fellow programme to support research and training of top graduate students selected to lead the future development of science and technology. In Luxembourg, the national grant system allocates funds to doctoral and postdoctoral students, independently of their citizenship, for scientifically excellent research projects with the condition that the project is linked in some way to Luxembourg, i.e. the research is (at least partly) performed in Luxembourg and/or the results of the research are expected to have an impact at national level. In 2002, an innovative pilot project of grants called Luxembourg International Advanced Studies in Information Technologies was set up in the field of IT research. Norway has an annual budget of EUR 4.7 million to increase recruitment for undergraduate studies in engineering (Bachelor in Engineering), and has established 40 one-year classes (each with at least 30 students) for students with a vocational secondary education background. Norway is also increasing its expenditure on postgraduate research training, with a goal of increasing the number of PhD degrees from 700 to 1 100 (total for all disciplines) a year by 2010. To deal with the significant decline in the technical and agricultural sciences, the Slovak Republic has introduced “Development of Personality and Talent of Young Employees and PhD graduates up to Age 35” and the “Prize of the Minister of Education”. Science Foundation Ireland, the Irish Research Council for Science, Engineering and Technology and the Irish Research Council for the Humanities and Social Sciences have introduced several programmes to fund post-graduate researchers in tertiary-level institutions. Demand side policies
78
While most policy development for HRST has addressed the supply side (i.e. increasing the supply of scientists and engineers) a few countries have explicitly begun to address the demand side. For example, the Korean government has introduced a Research Officer programme to provide young PhDs with career opportunities as research scientists and engineers in the military sector and has set up Human Resource Incubating Centres which will retain young unemployed scientists and engineers temporarily for practical training. In 2003, Norway established a National Centre for Contact with the Business Community on MST subjects (RENATE) to increase contact between education institutions and the business community and thus ensure the recruitment of students studying science, mathematics and technology. Luxembourg’s new full university has meant an increase in the demand for teachers and researchers. © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
Attracting foreign scientists and engineers Additional effort has been put into supplementing domestic supply with scientists and engineers recruited from foreign countries. Some of these programmes attempt to address growing concerns about brain drain from countries with limited science and technology infrastructure, but most attempt to tap into sources of foreign workers to meet domestic needs. Primary mechanisms include reforms to immigration laws and procedures, scholarships for foreign researchers and efforts to attract expatriate researchers. Reforming immigration procedure A first step toward recruiting foreign scientists and engineers has been to revise immigration procedures to ease their entry into host countries. In the United Kingdom, the Highly Skilled Migrant Programme, introduced in 2002, successfully enabled highly skilled individuals to enter the country to seek and enter work without the need for a prior offer of employment. The scheme has recently been strengthened by introducing a new category of eligibility for younger workers and by extending the duration of work permits from 4 years to 5 years. In response to concerns from employers regarding delays in the processing of highly skilled immigrants, Canada provided CAD 6.6 million over two years in the February 2003 budget to launch a fast-track system for skilled workers with permanent job offers from a Canadian employer. The budget also allocated CAD 41.4 million over two years to attract and integrate skilled immigrants into Canada’s labour market. New Zealand also attracts highly skilled migrants in accordance with the Government’s Immigration Programme. The Dutch Cabinet has decided to simplify procedures for immigrating science and technology workers and to lower fees for entering the country (making them more comparable with those for other European countries), in order to facilitate the influx of foreign knowledge workers into the Netherlands. In Australia, where demand for skilled ICT workers has declined, previous reforms have been repealed (Box 2.5). Recruiting foreign students and researchers Recognising that foreign students and researchers can help relieve domestic shortages in the supply of science, technology, engineering and mathematics skills, OECD countries actively recruit them in their home countries. Recently introduced programmes aim to attract researchers at various stages of their careers; some emphasise graduate students and others post-doctoral researchers depending on country-specific needs and capabilities. The United Kingdom, for instance, has focused on special scholarships for foreign PhD students. In 2003 the Prime Minister announced a new GBP 10 million initiative to bring high-quality PhD
Box 2.5. Immigration reform for ICT workers in Australia At the time Backing Australia’s Ability was announced, Australia was suffering from a shortage of ICT workers, and initiatives were implemented to attract such workers. A Ministerial Direction was issued on 1 February 2001 to all immigration decision makers requiring them to give immediate processing priority to ICT professionals. By March 2003, in response to the changing labour market for ICT professionals, the Migrant Occupations in Demand List (MODL) lists – which lists occupations and skills for which the government has identified a shortage across Australia – was reduced to just four ICT specialisations. Such measures have since been wound back in response to lesser demand for ICT skills; the ICT priority processing directive was suspended in July 2002 and the MODL list was amended so that no ICT specialisations were listed in November 2003. The Australian Computer Society also tightened the IT qualification assessment requirements for overseas visa applicants. 79
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
students from overseas to top UK universities to study science. The new Dorothy Hodgkin Postgraduate Awards will allow over 100 PhD students from India, China, Hong Kong (China), Russia and the developing world to study in the United Kingdom. Other countries have focused more on post-doctoral students. In France, for instance, a postdoctoral programme has already succeeded in attracting 900 foreign researchers to top research labs. The objective for 2004 is to recruit 110 additional foreign post-doctoral researchers through a competitive call for proposals by the hosting research teams. Japan has a Postdoctoral Fellowships for Foreign Researchers programme to invite bright young researchers to Japan. In Hungary, various postdoc fellowships are also open to researchers from abroad.23 Spain’s focus has been on hiring PhD-level researchers to staff public research organisations. Its Ramon y Cajal programme hires domestic and foreign researchers from all fields on five-year contracts. The total cost estimates for the five-year duration of the programme is EUR 320 million. Of the 2 000 contracts to date, 17% have been for foreigners and 21% for Spanish researchers working abroad. Germany has set a target to increase the share of foreign students in Germany from 8.5% to 10% over the next few years. To do so, it has implemented academic exchange programmes and special post-graduate programmes to facilitate the enrolment of highly qualified applicants from abroad. Attracting expatriate researchers For a number of countries, expatriate researchers are a key source of foreign workers. Returning overseas researchers not only reduce the domestic shortage of scientists and engineers, they also establish international research networks to facilitate additional inflows of foreign knowledge. The Australian government has taken a number of measures to promote return migration of expatriate researchers, such as Federation Fellowships and National Health and Medical Research Council support. In 2002, Belgium established a number of awards to promote the return migration of expatriated Belgian researchers. In that year, 14 awards of two years were made for a total of EUR 1.24 million. The Brussels-Capital region has established an international network to promote mobility and communication among researchers. In Hungary, the Szent-Györgyi fellowship enables internationally acknowledged Hungarian or foreign researchers living outside Hungary to work in Hungarian institutions of higher education. Mexico has a programme of economic support for repatriating Mexican researchers working abroad. In New Zealand, the New Leaders initiative is aimed at repatriating researchers back to New Zealand. Evaluating innovation policies Evaluation is central to formulating good policy. Government programmes need to be evaluated periodically to ensure their effectiveness and to improve their design. OECD countries have undertaken many evaluations of science and innovation policy over the last two years, some encompassing the entire innovation system and others focusing on specific elements or funding agencies. Outcomes of evaluations often become input for preparation of new policies, and ex–ante evaluations are becoming more common to clarify possible impacts of new policies. Broad evaluations
80
Several countries have recently completed or announced plans for broad evaluations covering almost all innovation policies. In 2003, the Australian government announced the release of Mapping Australia’s Science and Innovation, which laid the groundwork for future policy development by identifying areas of strength and weaknesses in science and innovation performance and areas where collaboration between the federal government, the states and territories could be improved. The Prime Minister of Canada indicated in December 2003 that the government would undertake a comprehensive assessment of federal support for research and development.24 The Czech Republic has a regular evaluation system, which furnishes important input for the preparation of new R&D policy; evaluation of the previous National Research and Development Policy, which was adopted in 2000, was carried out © OECD 2004
Recent Developments in Science, Technology and Innovation Policies
during preparation of the Analysis of Previous Trends and Existing State of Research and Development, published in 2002. This analysis, which represented important source material for the preparation of the new R&D policy, includes conclusions of the evaluation and recommendations for the future. Nearly all the Belgian authorities have decided to launch or to reinforce the evaluation of their science, technology and innovation policies. In Flanders, the Bijzonder Onderzoeksfonds (BOF) Fund has been significantly increased, but access to the Fund is subject to ex-ante and ex-post evaluations. The Walloon Council for Science Policy also decided to launch an evaluation of the Walloon science policy. Hungary did an ex-ante evaluation in 2003 to clarify the possible future impacts of the bill on research and technological innovation (social and economic dimensions). The goal of the exercise was to identify obstacles to the innovation process, to suggest feasible ways to eliminate them, and at the same time to examine future impacts, and to find concrete solutions in legal and technical terms. The evaluation used SWOT analysis (which identifies strengths, weaknesses, opportunities, and threats), a questionnaire, extended interviews and independent external expert panels. In 2002, Finland launched the ProAct programme to increase understanding of the effects of research and technology policy on society and the economy, and the effects of society on technological development. The second stage of the programme started in January 2004, with 33 projects. In December 2002, an international evaluation of the impact of public funding of biotechnology in Finland was issued, in preparation of a new funding scheme for biocentres. The Academy of Finland published in November 2003 the third review of the quality and impact of Finnish scientific research. These reviews are prepared on a triennial basis and give a general picture on the development of the quality and international visibility of Finnish science. Finland uses both qualitative and quantitative methods and is considering development of impact analysis methodologies. In Ireland, there is increased evaluation activity in public-sector funding agencies, some of which (e.g. Health Research Board, Teagasc, and Enterprise Ireland) have recently established a formal evaluation function. Forfás has responsibility for the evaluation of industry-oriented national science and technology programmes. The two major programmes – Programme for Research in Third Level Institutions, run by the Higher Education Authority, and Science Foundation Ireland – are currently being evaluated by independent international panels. The methodologies used in evaluations of key Irish national funding programmes draw on international good practice. Luxembourg makes regular and systematic evaluations of the programmes and the results obtained by financed projects, which lead, if necessary, to a readjustment of funding priorities. In Austria, the most important political stakeholders in the field of R&D (ministries, public research organisations) established the Platform for Evaluation of Research and Technologies.25 All activities directed towards better and more transparent evaluations to achieve better strategic planning in R&D policy, standards and evaluation guidelines are being supported. A mid-term evaluation of the Spanish National Research Technological Development and Innovation (RTDI) Plan (2000-03) was performed at the end of 2002 by analysing opinions of stakeholders and public and private beneficiaries of actions. Out of 64 main recommendations suggested in the evaluation, the new National Plan for 2004-07 takes 55 on board. They concern the plan’s strategic objectives, its structure, scientific and technical objectives (priorities) of the thematic areas, instruments for implementation and financing and, finally, the management of calls for proposals. New requirements for evaluation In some countries, evaluation of innovation systems has become compulsory. Since 1 January 2002, policy evaluation and policy preparation in the Netherlands are subject to the ministerial decree on performance measurement and evaluation (Regeling Prestatiegegevens en Evaluatieonderzoek, RPE). The decree imposes a number of requirements, e.g. ex ante evaluation (which implies that policy makers have to consider different policy alternatives), monitoring and ex post evaluation. Every instrument now has to be evaluated every five years. In New Zealand, all government agencies involved in national innovation policy are required to undertake evaluations (through output agreements) which are subject to scrutiny by parliament. © OECD 2004
81
OECD Science, Technology and Industry Outlook 2004
Evaluation objectives are enshrined in legislation governing the management of research, science and technology, such as the requirement in the Foundation for Research, Science and Technology Act and the Crown Research Institutes Act that their funding and research activities must benefit the nation. The Ministry of Research, Science and Technology reviews the results of R&D investments on a five-year rolling cycle. At programme level, purchase agents evaluate the achievements and benefits arising from investment decisions. These are compared to outputs in the agencies’ annual performance and achievement reports. The recent introduction of performance-based research funding in New Zealand tertiary institutions has required an extensive evaluation of the skills and capabilities of institutional departments. This is the first such comprehensive study in New Zealand. In January 2001, the Swedish Parliament founded the Swedish Institute for Growth Policy Studies (ITPS). According to the Ordinance on Instructions to the ITPS (2000:1133), the institute’s main task is to initiate, commission and evaluate industrial, innovation and regional policy measures. In addition, it is to provide the policy-making system with analysis of economic development and growth as a basis for decision making and to develop and disseminate methods for facilitating learning and evaluation. In 2003 the government gave the institute two special commissions in the innovation area. One was to evaluate some of the R&D programmes initiated by the VINNOVA. Another was to make a survey of actors in the Swedish innovation system. According to Article 170 of the Swiss Constitution, the Federal Parliament ensures that the effectiveness of measures taken by the Confederation is evaluated. This task is specified in the new law on Parliament. Article 141 states that legislative or regulatory changes proposed by the Federal Council have to be accompanied by a report (so-called message) giving information about the impact of new legislation in various fields, for example, on society, economy and the environment, on the equal treatment of men and women and on its general costs and benefits. With this new article, ex–ante evaluation becomes more important for policy formulation in Switzerland. Evaluations of horizontal policies and programmes have become more popular in the Swiss policy-making system (for example, an evaluation of federal measures concerning the information society was conducted by CEST – the Centre for Science and Technology Studies – in 200226). The United Kingdom is fully committed to evaluating its science and innovation policies. Such information is an integral part of its evidence-based approach to policy making. DTI is required to demonstrate the achievements of its programmes across all areas of the Department’s work, including innovation policy. To this end, a central committee agrees an annual work programme of evaluations. Evaluations may be undertaken by in-house evaluators, who have no responsibility for the programmes themselves, or by consultants appointed for the purpose.
82
© OECD 2004
Recent Developments in Science, Technology and Innovation Policies
NOTES 1. As of September 2004, four countries held Observer status in the CSTP: China, Israel, Russia and South Africa. 2. The policy questionnaire also inquired about programmes to promote innovation in the service sector. These are reviewed in Chapter 4. 3. At the March 2002 meeting of the European Council in Barcelona, European Ministers announced a goal of “… turning the EU into the most competitive knowledge-based economy in the world”. One identified objective for achieving this status is to raise spending on R&D and innovation in the EU so that it approaches 3% of GDP by 2010. 4. The United Kingdom’s Science and Innovation Investment Framework is available on line at: www.hm-treasury.gov.uk/ spending_review/spend_sr04/associated_documents/spending_sr04_science.cfm. 5. Available at: www.dti.gov.uk/innovationreport/index.htm. 6. Institutional funding refers to block funds that governments or funding agencies allocate annually to researchperforming institutions. Institutions are free to use these funds in any way they see fit, as they do not come with strings attached. Project funding is normally granted when research performers apply for grants from competitive funding programmes of public research funding agencies, usually research councils. This includes funding through the “responsive mode”, since application grants need to be made in order to obtain funding through this mechanism. Contract funding of public sector research from business or private non-profit organisations also falls into this category because funding is for specific projects (OECD, 2003). 7. This funding would not be earmarked for this purpose, but by describing the amount, the minister hopes that universities will more easily justify spending money on valorisation. 8. A notable exception is Sweden, where public funding of research carried out in companies is unusual. Swedish research and technology programmes are mainly aimed at raising the level of research within universities in areas of future interest to companies. Greater efforts are made to increase involvement of industry in the form of co-funding or actual work in co-operation with universities and institutes. 9. The SNCI is a banking institution governed by public law and specialised in providing medium- and long-term financing to Luxembourg businesses. 10. The offset allows firms with turnover of less than AUD 5 million, R&D expenditures of less than AUD 1 million and no tax liability to receive a cash rebate equivalent to the value of the tax concession. Alternatively, such firms can carry over the tax concession for a period of 3 years. 11. The Dutch WBSO stimulates business research by reducing wage tax and social security contributions for companies with employees and deducts a fixed amount from the profit for self-employed persons. 12. It has some 260 industrial technology advisors, located in 90 communities across Canada, who work with approximately 12 000 SMEs a year, helping clients to tap into sources of specialised expertise that can resolve a broad variety of technology-related business problems. 13. Tekes, the National Technology Agency of Finland is the main public financing and expert organisation for research and technological development in Finland. 14. “Avance” is Spanish for advance; it is also the acronym for a programme that seeks to produce high value added businesses linking knowledge with visionary entrepreneurs. 15. www.crc.gov.au/. 16. www.crc.gov.au/Information/Programme_Evaluation.asp. 17. Clusters can be defined as networks of production of strongly interdependent firms (including specialised suppliers) linked to each other in a value-adding production chain. In some cases, clusters also encompass strategic alliances with universities, research institutes, knowledge-intensive business services, bridging institutions and customers (OECD, 1999). 18. Additional information is available at www.nzte.govt.nz/. 19. A more detailed discussion of the supply of HRST can be found in Chapter 5. 20. Additional information is available online at www2.set4women.gov.uk/set4women/research/the_greenfield_response.htm.
© OECD 2004
83
OECD Science, Technology and Industry Outlook 2004
21. The United Kingdom’s Roberts’ Review is available online at www.hm-treasury.gov.uk/Documents/Enterprise_and_Productivity/Research_and_Enterprise/ent_res_roberts.cfm. 22. www.education.ie/servlet/blobservlet/physical_sciences_report.pdf. 23. Additional information on the Hungarian scholarship programme is available at www.fpi.hu. 24. In addition, Canada introduced accountability measures in budget 2003 for publicly funded foundations to ensure that these organisations fulfil the objectives of their respective mandates. These measures require foundations to provide corporate plans, annual reports and regular independent evaluations to the minister responsible for the funding agreement. Departments are also expected to include significant expected results in the Departmental Reports on Plans and Priorities and to include any findings from evaluations in their Departmental Performance Reports. 25. For additional information, see www.fteval.at. 26. The report is available in English at www.cest.ch/Publikationen/2002/CEST_2002_5_e.pdf. In addition, CEST has conducted comprehensive evaluations of some extra-university research institutions.
84
© OECD 2004
Recent Developments in Science, Technology and Innovation Policies
REFERENCES Nelson, R. (ed.) (1993), National Innovation Systems, Oxford University Press, Oxford. Nelson, R. and Winter. S.G. (1982), An Evolutionary Theory of Economic Change, The Belknap Press of Harvard University Press, Cambridge, Massachusetts. OECD (1998), Technology, Productivity and Job Creation, OECD, Paris. OECD (1999), Boosting Innovation: The Cluster Approach, OECD, Paris. OECD (2001a), The New Economy: Beyond the Hype – The OECD Growth Project, OECD, Paris. OECD (2001b), Science, Technology and Industry Outlook – Drivers of Growth: Information Technology, Innovation and Entrepreneurship, OECD, Paris. OECD (2003), Governance of Public Research, OECD, Paris. Porter, M. (1990), The Competitive Advantage of Nations, Macmillan, London. Rosenberg, N. (1982), Inside the Black Box: Technology and Economics, Cambridge, Cambridge University Press. Saxenian, A. (1994), Regional Advantage: Culture and Competition in Silicon Valley and Route 128. Harvard University Press, Cambridge, Massachusetts. Tidd, J., J. Bessant and K. Pavitt (1997), Managing Innovation, Wiley, Chichester, UK.
85
© OECD 2004
Chapter 3
PUBLIC/PRIVATE PARTNERSHIPS FOR INNOVATION
Public/private partnerships (P/PPs) offer a framework for the public and the private sectors to join forces in areas in which they have complementary interests but cannot act as efficiently alone. They are increasingly popular in research and development (R&D) because they can effectively fill gaps in innovation systems, increase the efficiency of government policy in addressing market failures that affect innovation processes and address new social needs, especially when this requires long-term multidisciplinary research. Deriving such potential benefits challenges governments’ ability to use P/PPs for the right purposes and manage them efficiently. This chapter draws the main lessons regarding the optimal implementation of P/PP programmes from peer reviews of four countries: Australia, Austria, France and the Netherlands.
87
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction A major conclusion of recent OECD work on economic growth was that governments need to be more responsive to the rapid transformation of innovation processes and related business needs and strategies, and that greater use of public-private partnerships (P/PPs) can increase this responsiveness and therefore enhance the efficiency and cost-effectiveness of technology and innovation policy (OECD, 2001). P/PPs for research offer a framework for the public and the private sectors to join forces in areas in which they have complementary interests but cannot act as efficiently alone. Traditional in building physical infrastructures, they are increasingly popular in research and development (R&D) because they can effectively fill certain gaps in innovation systems (e.g. the lack of interaction between industry and public research), increase the efficiency of government policy in addressing certain market failures that affect innovation processes (e.g. the high costs and risks of pre-competitive research), and address new social needs, especially when this requires long-term multidisciplinary research. Deriving such potential benefits challenges governments’ ability to use P/PPs for the right purposes and manage them efficiently. This chapter draws the main lessons regarding the optimal implementation of P/PP programmes from peer reviews of four countries: Australia, Austria, France and the Netherlands (Table 3.A.1.1). P/PPs for innovation: definition and typology The P/PP concept can encompass a broad range of co-operative relations or activities and a broad variety of programmes in terms of size, objectives and design. This can severely hamper the search for good policy practices in the absence of an agreed definition and typology. To decide what degree, form and content of interaction between the state and industry constitute a partnership – as opposed to more casual, arms-length or hierarchical relationships – the following criteria should apply: • Institutionalisation. P/PPs involve formal relations or arrangements between the public and private sectors. This does not diminish the importance of informal relations, which are often a very fruitful form of collaboration. Formal relations develop very often out of existing informal relations. • Government as partner. Government is unambiguously a partner of the private sector rather than a catalyst or regulator of private sector activities. Public actors in P/PPs may include federal and local government, government laboratories, public research institutes, publicly funded universities, research councils, public corporations or other public bodies, as well as international organisations. Private actors may include individual firms and other private organisations such as firm consortia and trade associations. P/PPs fit within a policy framework. Quite often, a national P/PP programme is composed of several sub-programmes, each of which comprises smaller projects involving collaboration between public and private actors in specific fields and/or regions, and the characteristics of P/PPs vary widely depending on their position within the hierarchy. For instance, governments are typically very active in creating an overarching P/PP programme but subprogrammes usually requires active involvement and initiative on the part of other public and private actors such as universities, public labs and companies. • Shared objectives and a clearly defined public interest. The shared objectives and interests of both partners are clearly identifiable and, from a public perspective, are linked to specific government goals and missions such as health, environment, defence or industrial competitiveness. 88
• Active involvement and co-investment of resources. Active involvement of all partners in the decisionmaking and management process and co-investment of resources are core elements of any P/PP. © OECD 2004
Public/Private Partnerships for Innovation
Co-invested resources include money, facilities, people and intangible assets such as knowledge, technology, expertise, information and networks. Some P/PPs involve joint contribution and sharing of each of these types of resources, but others require a varying mixture of co-investment that reflects the division of labour among partners. The role and degree of involvement of each partner may well vary in the course of the partnership process.1 The intensity of a partnership is stronger as the intensity of co-investment across all types of relevant resources increases. Given these criteria, the definition clearly excludes R&D contracting and other arrangements whereby the private or public sector mainly purchases services or equipment from the other. It also excludes mere public support to business R&D, when this involves only the flow of funds in one direction.2 It is important to recognise that whereas too loose a definition might encourage re-labelling conventional programmes as P/PPs as the concept gains political visibility and recognition, sticking to too strict a definition would mask the changing role and emerging forms of P/PPs for innovation in different, country-specific institutional environments. Some programmes may therefore be categorised as P/PPs in a strong sense, while others, with a lesser intensity of interaction among partners, may still be P/PPs, but in a weaker sense. P/PPs need also to be differentiated according to their objectives and goals. Public and private actors enter into partnerships for innovation for their own reasons. The fundamental interest of the private sector may simply be profit and new business opportunities through research, but firms may also have other motivations, such as access to public funding, access to the expertise and knowledge of the public sector, access to public infrastructure, access to information, building reputation and network. In fact, the stated objectives of a P/PP very often largely reflect those of the public sector (Box 3.1). The motivations of the public sector are manifold and can be general or more specific. The
Box 3.1. Stated objectives of two selected P/PP programmes Research and technological innovation networks (France) • Develop new forms of partnership between public research and the business community. • Contribute to the creation and/or growth of innovative technology-based firms. • Encourage research that could remove the technological obstacles to joint development of products and services based on new technologies. • Gear research to demand, so as to satisfy medium- and long-term economic or societal needs. • Help advance knowledge in response to societal demands. • Position French innovation networks in the European Research Area (ERA). Co-operative Research Centres (CRC) Programme (Australia)* • Enhance Australia’s industrial, commercial and economic growth through the development of sustained, user-driven, co-operative public-private research centres that achieve high levels of outcomes in adoption and commercialisation • Enhance the contribution of long-term scientific and technological research and innovation to Australia’s sustainable economic and social development. • Facilitate the transfer of research outputs into commercial or other outcomes of economic, environmental or social benefit to Australia. • Enhance the value to Australia of graduate researchers. • Promote collaboration among researchers, between researchers and industry or other users, and improve efficiency in the use of intellectual and other research resources. * As stated in the 2002 round. 89
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
general goals typically include: i) innovation-driven economic growth and industrial competitiveness; ii) strengthening of the national innovation system; iii) creating new technology-based firms and supporting innovative small and medium-sized enterprises (SMEs); iv) promoting private investment in R&D and innovation; and v) increasing the efficiency and effectiveness of public spending on R&D and innovation. More specific goals include: i) development of key technologies and products that are needed to fulfil public missions; ii) technology diffusion and commercialisation of the results of publicly funded research; iii) building public infrastructure for innovation; and iv) building innovative networks and enhancing co-operation in specific locations, sectors or technological fields. Figure 3.1 proposes a typology of P/PPs. The corners show the four types of traditional policy measures: public procurement; public performance of R&D; direct/indirect subsidies to business R&D through tax incentives or conventional grant schemes; and public provision of infrastructure (including for human resource development) and services for business R&D and innovation. Towards the centre are shown four categories of programmes that are close to conventional policy measures in terms of stated goals but incorporate some P/PP components. Examples include: grant schemes that require matching funding by the private sector (e.g. grants from the Netherlands Organisation for Applied Scientific Research [TNO] financed by the Ministry of Economic Affairs in the Netherlands); various measures aimed at the commercialisation of publicly funded R&D; and other public support measures in the design and management of which the private sector is formally involved (e.g. schemes to facilitate development of or access to human resources, such as CIFRE and CORTECHS [see Table 3.1] in France). Finally, in the centre of the figure are proposed four major types of P/PPs: mission-oriented, marketoriented, industry-science relation (ISR)-oriented, and cluster/network-oriented.
In fra bu su str si pp uc ne or tu ss t t ra R o l &D
Te ch no l se ogy rv e ic xte es n si on
C lu st e P/ r-o PP rie s nte d
M is si o P/ n-o PP rie s nte d ed nt ie or s s- P R /P IS P
m h fro rc er ea sf es an r Tr blic pu
ic bl tion Pu cu D e & ex of R
90
r ve g le in C anc ed nt fin rie t-o Ps ke /P ar P M
pr C oc le ur ve em r en t
n io at s is s id ine bs us D Su of b R&
pr P oc ub ur lic em en t
Figure 3.1. A typology of P/PPs
Source: OECD.
© OECD 2004
Public/Private Partnerships for Innovation
Such programmes are not mutually exclusive. For example, the last two types mentioned, which are gaining in importance, often have mission-oriented objectives (e.g. the rise of so-called “national benefits” Co-operative Research Centres [CRCs] in Australia) or market-oriented secondary objectives (e.g. the Kind and Knet programmes in Austria [see Table 3.1]). Some P/PPs may even be part of broader programmes with multiple main objectives (e.g. the National Centres for Technological Research in France). Moreover, the nature of programmes may change over time: a conventional support
Table 3.1. Major P/PP programmes in four countries
Australia
Austria
France
Budget (millions)
P/PP programme
Purpose
Co-operative Research Centres Programme (CRCs)
Promote collaborative research between industry and public research organisations. AUD 148.6
Innovation Investment Fund
Provide small, high-technology companies with access to equity capital.
26.0
Pre-seed Program
Facilitate financing of spin-offs from public research.
6.0
Rural R&D Corporation
Partnership between government, including public research organisations (e.g. CSIRO) and rural industries to advance the uptake of knowledge by industry.
194.4
ARC Linkage Grants and Fellowships
Promote alliances between higher education institutions and industry, including funding for industry fellowships and infrastructure.
76.7
9.1 %
Kplus, Kind/Knet
Promote collaborative research between industry and EUR 36.0 public research organisations.
Christian Doppler Laboratories
Bridge the gap between universities and industry research through support to industry-relevant research by small public research teams.
Research and Technological Innovation Networks (RRITs)
2.8% 4.0
Promote collaborative research between industry and public research organisations. EUR 173.7
National Centres for Technological Promote collaboration between public and private Research (CNRT) labs in regional innovation hubs.
n.a.
Regional Centres for Innovation and Technology transfer (CRITT)
n.a.
Facilitate SME access to technological competencies of the education system.
n.a.
Technological Research Teams
Stimulate industry-relevant research in universities
n.a.
CIFRE and CORTECHS
Facilitate SME access to highly skilled labour.
n.a.
Netherlands Leading Technology Institutes (LTIs) STW Technology Foundation Innovation-oriented Research Programmes (IOPs)
Promote collaborative research between industry and public research organisations. EUR 28.9 Stimulates demand-driven technical and scientific research at Dutch universities.
42.8
Strengthen strategic research at Dutch universities and research institutes in relation to private sector needs, via a programme-based approach.
13.4
Organisation for Applied Scientific Promote more demand-driven strategic and applied Research (TNO) research via matching grants. Technological Partnership scheme
Subsidise technological projects by corporate alliances or partnerships between companies and between companies and research institutes.
28.1
6.3%
62.1
Economy, Ecology and Technology Support major research projects which can contribute (EET) programme to sustainable growth.
33.0
The Netherlands Genomics Initiative
Promote collaborative research in the field of genomics.
11.4
Catalysis
Promote collaborative research in the field of catalysis.
2.3
© OECD 2004
P/PPs as % of total S&T budget
91
OECD Science, Technology and Industry Outlook 2004
programme or clever financing scheme may accumulate sufficient partnership content to cross the line and become a true P/PP (e.g. the successive reforms of the Advanced Technology Program (ATP) and Small Business Innovative Research (SBIR) programme in the United States). Finally, P/PPs for innovation may grow out of public procurement in other fields (e.g. a contract for water supply and treatment may induce a firm to enter a P/PP in related R&D). The increased use of P/PPs for innovation In recent years, P/PPs for innovation have continued to expand in the OECD area, as reflected in budget allocations and programme design. New types of P/PPs have emerged in new policy areas, and many countries have implemented reforms to improve existing programmes, often with the aim of deepening the partnership component.
Table 3.2. Share of P/PPs in competitive funding of research in France EUR millions
Competitive P/PP funding (RRIT) Other competitive funding Total P/PPs in %
1998
1999
2000
2001
2002
15.2 26.0 41.2 37%
50.6 20.4 71.0 71%
66.3 21.5 87.8 76%
86.9 22.7 109.6 79%
80.2 23.0 103.2 78%
Source: French Ministry of Research.
P/PPs represent a significant and increasing share of the overall S&T budget (Table 3.2). Their share is likely to increase in future; for example, the Dutch government has reserved EUR 805 million for publicprivate research proposals in strategic areas for the 2003-10 period. Expansion of the scope of P/PPs has taken place in several directions: • First, major programmes to promote strategic R&D co-operation among universities, public research institutes and private firms have been launched or reinforced in many OECD countries. Co-operative research centres or networks (e.g. Kplus and Kind/Knet in Austria, RRITs in France and LTIs in the Netherlands) are increasingly popular, following the pioneering example of the Australian CRC programme. • Second, a number of OECD governments have promoted the formation of innovative networks in strategic research fields such as nanotechnology and genomics, either as stand-alone initiative (e.g. genomics in the Netherlands) or as part of a broader P/PP programme (e.g. Réseau de Recherche en Micro et Nano Technologies, Genhomme and Genoplante, as part of RRITs in France, and the Kplus centre on bio-molecular therapeutics in Austria). • Third, in several countries, early-stage funding of innovation has emerged as a new domain for P/PPs (e.g. Australia’s Pre-seed Programme).
92
While the reasons for the increasing use of P/PPs are many, it is possible to single out some basic ones (Figures 3.2 and 3.3). The fundamental rationale of most P/PPs is to reap broader economic and social benefits from investments in public research by: i) improving the leverage of public support to business R&D through cost and risk sharing; ii) securing higher-quality contributions by the private sector to government mission-oriented R&D and opening new avenues for commercial spillovers from public research; iii) fostering the commercialisation of results from public research; and iv) upgrading knowledge infrastructures. P/PPs emerge as a response to the partial failure of other policy instruments to achieve such objectives in a new environment characterised by the changing nature of R&D and innovation processes (e.g. increased scientific content of technological development, higher dependency of innovators on external sources of knowledge and know-how), and rapidly evolving business R&D strategies3 and social needs (e.g. health, security, environment). © OECD 2004
Public/Private Partnerships for Innovation
Figure 3.2. P/PPs for research and innovation: basic rationale
Improve connectivity within the NIS
Build new innovation capabilities
P/PPs
Provide compatible incentives
Traditional mission-oriented policies rested on three pillars: procurement, public research and targeted subsidisation of private R&D and innovation. In many areas they were characterised by the concentration of resources on large-scale programmes targeted predominantly at technical achievements, involving a small number of participants and managed through centralised administrative control. Such policies have lost Figure 3.3. Expected benefits from a P/PP approach to innovation policy
Subsidisation of business R&D and innovation
Public procurement
Improve quality and reduce cost of public procurement
Increase leverage of public support
P/PPs
Better exploit complementarity between public and private R&D
Public execution of R&D and innovation
Fill gaps in knowledge infrastructure
Infrastructural support to business R&D and innovation
93
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
their effectiveness because of the characteristics of new technologies (e.g. ICTs, biotechnology), the greater priority attached to some socio-economic goals (environment, health, security), and the more pressing social demand for tangible and more broadly diffused benefits from public investment in research. To be effective, new-generation mission-oriented programmes need to adopt a systemic approach, providing a framework for a more market-driven and bottom-up definition of objectives and more decentralised implementation procedures. Partnerships with the private sector are key components of new policies that are characterised by: the articulation of missions according to the highest social return; the widespread diffusion of results in order to maximise economic benefits; appropriate co-ordination between the genuine policy purpose of the mission (e.g. sustainable development, improved quality of life for the elderly) with the other goals of innovation and technology policy (e.g. increased competitiveness); the involvement of all qualified actors, irrespective of their status, size and location within the innovation system. The evolution of French research policy in the field of telecommunications is emblematic in this regard. Up to the mid-1990s, a specialised public lab, CNET (Centre National d’Études des Télécommunications) carried out most research for the public operator France Telecom. With the deregulation of markets and the corporatisation of France Telecom, new arrangements had to be found. Whereas France Telecom focused increasingly on near-market research, a research network, the RNRT (Réseau National de Recherche en Télécommunications) was created to promote pre-competitive research as well as start-ups and spin-offs. Generally as a complement to broadly based horizontal support to business R&D, diffusionoriented technology policies were traditionally aimed at promoting a one-way transfer of knowledge from national or foreign research institutions to manufacturing, as well as interactive technological learning among firms in the same sector. This orientation is at odds with current trends towards more interactive modes of innovation based on multidisciplinary knowledge inputs and more and more involvement with the service sector. First, feedback loops from industry to research organisations have to be engineered, e.g. by making bridging institutions operate as two-way transfer mechanisms. Second, greater flexibility than that allowed by a sectoral approach is warranted when linking sources and users of knowledge, as well as when filling gaps in the knowledge infrastructure. The evolution of Austrian innovation policy is illustrative in this regard. Project-based, non-targeted support for science, technology and innovation (mainly the Science Foundation – FWF – for basic research and the Industrial Research Promotion Fund – FFF – for applied research) had long dominated the system of public support to R&D. In recent years, there has been a move towards P/PPs that target clearly identified weaknesses in the innovation system, in particular in the area of science-industry relations. It is complemented by regulatory reform in the public research sector, especially universities. Overall, increased use of P/PPs reflects two priority objectives of technology and innovation policies: i) to fill gaps in innovation systems where this would yield the highest social return, instead of directing public support according to predefined sectoral or political priorities; and ii) to improve linkages among all actors in innovation systems by providing them with coherent and market-compatible incentives. Implementing efficient P/PPs: issues and good practices
94
P/PPs can potentially achieve what other policy instruments cannot, but handling them is a delicate matter. Their design and management must be such as to engage partners with different managerial cultures and partly conflicting goals in sustained co-operation. There is often a discrepancy between the hierarchical and rather stiff organisation of the public sector and the private sector’s increasingly network-based and flexible organisation. To be reliable partners of the private sector, government and public research organisations must often increase the speed with which they operate and adapt to business practices for project management. Reciprocally, firms must accept that P/PPs pursue objectives that go beyond those that can be easily translated into private benefits. An examination of P/PP policies in four countries suggest that success depends on how well the following main issues are addressed: ensuring industry commitment while balancing public and private objectives; embedding P/PPs properly within the innovation system; optimising financing arrangements; securing sufficient SME participation; creating appropriate international linkages; and implementing rigorous evaluation procedures (OECD, 2003a, b; OECD, 2004a, b). © OECD 2004
Public/Private Partnerships for Innovation
Ensuring industry commitment while balancing public and private objectives Commitment and balance should be achieved at the P/PP programme level, as well as at that of individual co-operative research centres or networks. Requirements differ according to the level, as well as the objective and research orientation, of each P/PP (Table 3.3), but some basic rules for success concern the nature of the process for selecting P/PPs and their participants and the arrangements regarding intellectual property rights. Table 3.3. P/PP objective and type of research Type of research Rather applied
Type of P/PP
Pre-competitive
Mission-oriented
• Some Australian “national benefits” CRCs • Some projects in some French RRITs
• Some Australian “national benefits” CRCs • Some French RRITs
Market-oriented
• Australian “Business Development” CRCs • Most Austrian Kind/Knet
• • • •
Australian “Industrial collaboration” CRCs Most Austrian Kplus Most French RRITs Dutch LTIs
Source: OECD.
In order to attract firms to P/PPs, a bottom-up and competitive approach in selecting co-operative research projects is a good practice. It has been implemented by the four countries examined (Figure 3.4 and Table 3.4). However, countries differ in the definition of the P/PP portfolio, i.e. the selection of research fields in which partnerships are promoted. There are two approaches.
Figure 3.4. The eight selection rounds since the inception of the CRC programme (Australia) Number of CRCs 10
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 15 CRCs established in 1991
1st round
10 renewals 6 renewals
20 19 CRCs established in 1992
2nd round 12 renewals
30
40
17 CRCs established in 1993
3rd round 10 renewals
50
60
11 CRCs established in 1995
70
4 renewals
4 CRCs established in 1999
80
1994
1996
1998
12 CRCs established in 2001
7th round
2000
8th round
2002
Note: Oval symbols designate the original funding decisions; other shapes designate the renewal of contracts. Source: Australian Department of Industry, Tourism and Resources.
© OECD 2004
5th round 6th round
12 CRCs established in 2003
90
Selection rounds: 1990 1991 1992
4th round
7 renewals
6 CRCs established in 1997
95
OECD Science, Technology and Industry Outlook 2004
Table 3.4. Selection process of the proposals for LTIs in the Netherlands 19 initial proposals
Food sciences Metals technology Polymers Telematics Sustainable energy Transport and logistics Bio-organic materials Catalysis Embedded systems ICT/Information on demand Innovation in medicine/health Knowledge management Mobile/telecommunication Multimedia engineering Oncology Optical/electro-optic materials Pyrotechnology of natural gas Telematics-European Design Centre Waterworks
6 invitations for business proposals
4 LTIs finally selected
X X X X X X – – – – – – – – – – – – –
x x x x – –
Source: Dutch Ministry of Economic Affairs.
The approach used by Austria and the Netherlands is to stick to a purely bottom-up approach. One drawback is that while one can ensure that each selected centre addresses a well-identified market failure in an important research field, from both a private and public perspective,4 nothing guarantees that, collectively, they cover all the areas with the highest strategic importance for the country. This is particularly apparent when, as in the Netherlands, few co-operative centres are funded. This risk is reduced with the multiplication of co-operative research centres, as in Austria,5 where, however, the issue of critical mass arises, especially for a small economy. Another approach seeks to balance public and private interests by using some top-down criteria to choose the main research fields eligible for support to collaborative research (Table 3.5). In Australia, “national benefits” CRCs were launched as a result of government targeting of areas of high importance for society, as determined by National Research Priorities. 6 They focus on research on resource sustainability, including maintenance of biodiversity, environmental health and natural disasters. Examples include those for satellite systems, pest animals and bush fires. In addition, in the last selection round, greater weight was given in the selection criteria to national research priorities, as
Table 3.5. Some selection criteria reflecting public interest and private benefit
96
Public interest
Private benefit
Australia1
• The proposed outcomes of CRC will make a significant contribution to Australia’s sustainable economic and social development • The proposed CRC has a well-defined graduate education and training programme
• The proposed CRC has well defined objectives that address a specific community and/or industry need • The proposed CRC has a well-structured, feasible and practicable strategy for the commercialisation, technology transfer or utilisation of research outputs
Austria
• Research competence and linkages to science • Human resource development
• Linkages to the business sector
France
• Scientific relevance and degree of innovation in the • Industrial and technological objectives light of usage trends, including in the public sector
Netherlands
• Possibilities for scientific developments in the fields, • Existence of a solid industrial base especially the chances for quantum leaps
1. 2002 selection round only.
© OECD 2004
Public/Private Partnerships for Innovation
identified by foresight or technology road-mapping exercises. In France, several research networks financed under the RRIT programme – such as PREDIT (land transport), Earth and Space, and RNRT (telecommunications) – build on pre-existing schemes that target strategic sectors, while others have been selected by the government on the basis of their role in the economy (e.g. multimedia) or their contribution to answering social needs (e.g. accidental pollution). Engaging industry in public good types of co-operative research requires efforts to make tangible private benefits possible, for example through spin-offs or other forms of commercialisation of research results. A major challenge in both approaches is to avoid a drift in the research agenda over time towards either too near-market research or blue-sky investigations with no prospective end users, in other words, avoiding the capture of P/PPs by either the business or the scientific community. The only solutions are strict monitoring, interim evaluations and sunset clauses with a rigorous evaluation prior to renewal. Strong leadership by an independent and respected manager seems to be important for escaping such risks. Intellectual property rights (IPRs) have an important influence on participants’ motivations, especially among private firms. Experience shows that standard IPR arrangements are not a good solution, given the diversity of co-operative research ventures. IPR rules should be negotiated among partners, using only a few basic guidelines. With minor differences, this is the practice in all four countries. In Austria’s Kplus, all IPRs belong to the centre and each partner has the right to use the results; Kind/Knet have no standard regulations. In Australia, IPRs belong to the CRC when it is incorporated and otherwise to the public-sector partners on behalf of the CRC participants. In France, RRITs are subject to a minimal IPR policy, which consists of ensuring that all IPR issues are covered by an agreement between all those involved in a joint R&D project. For a project to be eligible, all actors must approve a prior draft IPR agreement. The actual details of apportioning IPRs among the various categories of actors, both private and public, are ad hoc arrangements between the parties and not subject to any specific policy or guidelines. In the Netherlands, IPR allocation among partners is also on an ad hoc basis. Integration of P/PPs in the innovation system Benefits from P/PPs depend in part on how they are embedded in the innovation system. There are three aspects to be considered: i) the management of P/PP programmes within government (how do they fit into the S&T policy system?); ii) the systemic efficiency of P/PPs (how do they interact with other policy measures?); and iii) the organisation and management of individual P/PP research ventures, which represent a new type of actor in the innovation system (what are the best organisational models?). Within government competencies, the fields covered by P/PPs are often split between different ministries. For example, the Dutch LTI programme is under the Ministry of Economic Affairs, but the Ministry of Education, Culture and Science is the main funding body of TNO, the organisation for applied scientific research, and is responsible for university research. In France, RRITs are financed and overseen by both the Ministry of Industry and the Ministry for Research. In Austria, the Kplus programme was developed and started at the former Ministry of Science and Transport, now Ministry of Transport, Innovation and Technology, whereas the Kind/Knet programmes were launched by the Ministry of Economics and Labour. In Australia, the Department of Education, Science and Training is responsible for university research and administers the CRC program, but responsibility for industrial innovation lies with the Department of Industry, Tourism and Resources. P/PPs can provide opportunities and incentives for improved inter-ministerial co-ordination, but their design and operation may suffer from inter-ministerial competition.7 An efficient way to lessen this problem is to separate strategic steering from operations. There are two approaches, with equal merit in different national contexts, to doing this. One is to create an independent agency to run the P/PP programme, as Austria has done for Kplus.8 The other is to rely on independent bodies for the selection of proposals and programme evaluation, such as the CRC Committee in Australia, and to give managers or chief executive officers (CEOs) of co-operative centres a large degree of autonomy. © OECD 2004
97
OECD Science, Technology and Industry Outlook 2004
P/PP programmes are introduced to perform tasks that could not be accomplished at all or as efficiently through other measures, but their performance may depend on the existence of complementary policies. The costs of the increased complexity of already complicated S&T policy systems should not exceed the expected benefits derived from P/PPs. The rise of P/PPs may justify intensified efforts to streamline the public support schemes for innovation, as the Netherlands is currently doing. This is not to rule out any form of policy experiments whereby different government bodies compete to develop innovative answers to a given problem. For example, in Australia, the ARC Centres of Excellence are supported by part of the scientific community as a complementary or arguably alternative approach to CRCs for supporting public good collaborative research. In the Netherlands, a research project that had been rejected in the LTI selection process has subsequently been successful under different arrangements (Catalysis is currently hosted by the Dutch Science Foundation – NWO). The success of a P/PP programme always owes much to the favourable framework conditions for research and innovation created by other measures and institutions, including, for example, generic support to business R&D and the accumulated expertise of public research institutions. In addition, some more specific measures may enhance the systemic efficiency of P/PPs. For example, Austria’s K programmes are complemented and supported by the Christian Doppler Laboratories (CDL). CDL is an effective model for easy-to-handle, smaller scale P/PPs for R&D between industry and academia. In Australia, the ARC Linkage Grants could play the same complementary role vis-à-vis the CRCs. Australian firms also benefit from an increasingly generous set of tax incentives that encourage additional business investment in R&D.9 Whereas good P/PP programme design and management can ensure a balance between the interests of the public and private sectors, satisfactory daily operations of the co-operation research centres or networks requires an organisation and management which bring together for a common purpose individuals from two different communities, scientists and engineers, who often have different mindsets and practices (Table 3.6).10 Flexible organisational models that can be customised to meet the specific needs of partners, efficient knowledge management, and strong leadership are necessary to build the level of trust that is required for the smooth and productive operation of co-operative research ventures. In all four countries examined, the government imposes only minimum requirements for the organisation of P/PPs. While some of these take the form of central institutes (the Institute for Metals Research and the Telematica Institute in the Netherlands, and Austria’s Kplus centres), others are virtual organisations, with a lean organisation at the core and research being done at the participating research institutes. Participants in P/PPs that build on pre-existing networks usually choose to organise as virtual institutes (the Dutch Polymer Institute) and WCFS (food technologies), Austrian Kind/Knet, French RRITs and most Australian CRCs). Each organisational model has advantages and disadvantages (Table 3.7). A central institute can more easily mobilise and motivate researchers and build a corporate image, but it runs the risk of a lack of full support from some participating organisations because it takes
Table 3.6. Differences between science and technology communities
Goal: to advance Specific objective Method Form of knowledge Communication Rewards Quality of assessment Complementary function 98
Science community
Technology community
Knowledge Find causal relationships Experiment Explicit, universal Open Reputation Replication, peer-review Training, publication
Utility Improve function of artefacts Testing Tacit, local, routines, procedures Secret Profit Market selection Production, marketing
Source: SPRU.
© OECD 2004
Public/Private Partnerships for Innovation
Table 3.7. Organisational models Central institute
Virtual institute
Advantage
• Easy integration • More corporate culture
• Researchers can work in their natural habitat • Flexible personnel policy
Disadvantage
• Pulls out researchers from universities • Can become isolated
• Difficult to organise • Double loyalty of researchers
Source: OECD.
promising researchers and funds away from them. The virtual institute can mobilise manpower and equipment at their home institutes, but the loyalty of research partners may be weaker, as they may have a greater incentive to concentrate on their own, separate missions. Efficient knowledge management is vitally important to minimise the risk of opportunistic or egotistical behaviour. All partners should believe that demonstrating a co-operative spirit will increase their chances of appropriating a fair share not only of the knowledge generated through P/PP projects, but also of the background knowledge that flows between participant organisations. It is important that the organisational features of a P/PP maximise interaction not only among the researchers directly involved in a project but also between them and the end users of research results in participating firms (e.g. the focal points in Figure 3.5, which shows the organisational diagram of WCFS, the leading Dutch
Figure 3.5. The WCFS1 organisational diagram
WCFS Board Programme Council
MANAGEMENT TEAM WCFS Director
Focal Points
Nutrition and Health
Project Leaders
Project Teams
Focal Points
Structure and Functionality
Project Leaders
Project Teams
Focal Points
Processing and Functionality
Project Leaders
Project Teams
MANAGEMENT STAFF
OFFICE STAFF
Financial Manager
Secretariat
Personnel Manager
IT Support
Office Manager
1. WCFS is the leading Dutch institute on food technologies. Source: WCFS, Annual Report.
© OECD 2004
99
OECD Science, Technology and Industry Outlook 2004
institute on food technologies). Flows of knowledge can also be enhanced through exchanges of researchers between partners and recruitment of PhD students to work on specific projects. Access to knowledge can be facilitated by training courses, mindshare events and regular workshops, as well as by intensive use of Internet-based communication tools. Finally, experience shows that no organisational arrangement, however good, can fulfil alone the delicate task of holding partners together and avoiding a drift in the research agenda. Strong leadership by a well-known, respected figure with broad experience and good links with both academia and industry is always a necessary condition of success. Optimal financing In theory, an optimally designed financing mechanism should help: i) ensure efficient selection of private partners; ii) secure the desired amount and quality of R&D at least cost to the government; and iii) avoid opportunistic behaviour by either the government or the private partners, especially the risk of partnerships attracting second-rate projects and less qualified research teams or a drift in the research agenda towards either pure basic research or outsourced corporate research. In practice cost-sharing ratios among partners differ from country to country. In France, and to a lesser extent in Australia, they even differ quite widely from network to network. For example, in Dutch LTIs, the government funds at most 50% of total costs and public research organisations and firms provide at least 20% in matching funds. In the case of French RRITs, industry participation ranges from around one-third to almost one-half. Public research labs are deeply involved and provide from 27% of the budget appropriations for space and aeronautics to 42% in life sciences. Participation of academic laboratories is even more diverse: from 5% in life sciences to 19% in ICTs. In Australia, two-thirds of all resources are provided by the CRC programme, universities, CSIRO (the Commonwealth Scientific and Industrial Research Organisation) and other Commonwealth organisations. Only one-quarter is provided by industry and other non-government sources. In Austria, up to 35% of total costs are covered by federal funds, a maximum 25% from other public sources, and a minimum 40% from industry. There is room for improvement in such financing arrangements, especially regarding the rate of subsidisation by the central government. A central issue is whether such support is warranted at all, and if so for how long and at what rate. When launching the LTIs, the Dutch government announced that it would stop funding them once they reached maturity. After four years, LTIs were renewed with unchanged financial arrangements, but the objective of making them self-sustaining by 2007 was reaffirmed. Australia has also always sought to encourage CRCs to develop strategies that would allow them to become independent of financial support from the CRC programme. At the same time, however, it was recognised that some CRCs, because of the field of research and the substantial public benefit aspect, may never reach independence. In fact, lengthy experience with CRCs demonstrates that very few CRCs reach self-sufficiency and that consequently self-sufficiency should not be an overriding objective of a P/PP programme. Rather, the objective should be to introduce some flexibility in financing arrangements so as to find a better match between these arrangements and the specific mission of different types of P/PPs: • When a P/PP aims at mobilising the competencies of the private sector to improve government mission-oriented R&D, it will have to be supported permanently. • The same may apply to P/PPs for pre-competitive research, but with a lower rate of support. • When a P/PP aims primarily at improving the leverage of public support to business R&D, the rate of subsidisation should be even lower, with a sunset clause.
100
• For P/PPs whose main objective is to open new avenues for commercial spillovers from public research, different financial arrangements might be applied to different stages (e.g. launching stage, mature stage, commercialisation stage), with an effort to involve venture capital as soon as possible. © OECD 2004
Public/Private Partnerships for Innovation
Participation of SMEs Strong participation of SMEs in P/PPs is essential for their success in many technological fields, but also more generally for stimulating technological entrepreneurship, ensuring that highly innovative small firms have access to the most fertile sources of knowledge, and linking science-based innovation networks to less R&D-intensive ones. The rise of P/PPs as a tool of S&T policy may induce increased participation of SMEs in publicly supported R&D projects. This accentuates the revealed preference of government-financed business R&D for small firms which can be observed in a majority of countries11 and attenuates the bias against SMEs in others. France exemplifies the latter situation (Table 3.8). The launch of its RRITs had two major impacts. First, it boosted the involvement of independent SMEs in research areas dominated by large firms and their subcontractors (e.g. in transport and telecommunications, RRITs replaced less SMEfriendly approaches, the so-called large-scale programmes). Second, it created new opportunities for science-industry partnerships in areas such as life sciences and multimedia where new and existing small firms are key actors at every stage of the research and innovation processes. However, imposing collaboration with other firms as a condition of eligibility for a P/PP may not be sufficient to guarantee a satisfactory degree of SME involvement. The weak presence of SMEs at the interface between science and innovation remains an issue in almost all countries, even in those that have the longest successful experience with P/PPs. For example, in Australia, the guidelines for the latest selection round of CRCs state that the government wishes to see opportunities for SMEs to participate enhanced.12 Innovative SMEs have strong incentives to develop linkages with other firms and knowledge institutions, but they often experience difficulties in devising and implementing their networking strategy. These difficulties, which generally increase with the depth and breadth of the network, are due to: • The relatively high amount of senior management resources required for initiating and sustaining participation in a co-operative venture. • The need to commit resources for a long period. • The difficulty of gaining enough influence within a network to justify such investment and commitment, given the pivotal role of large firms in most high-technology, and especially science-based, innovation networks.
Table 3.8. Share of SMEs in the financing of 13 French public/private research networks, 2001 Millions of EUR, % Life sciences1 Type of recipient
SMEs4 Large firms5 Public research labs Higher education Engineering schools Others Total
Energy, transport, environment, natural resources2
Information and communication technologies3
EUR
%
EUR
%
EUR
%
11.39 0.37 11.15 1.43 0.93 1.39 26.65
43 1 42 5 3 5 100
4.34 1.71 6.60 2.62 0.83 1.32 17.43
25 10 38 15 5 8 100
7.34 6.76 12.55 7.08 2.88 1.09 37.69
19 18 33 19 8 3 100
1. RNTS, GenHomme, Génoplante, RARE. 2. PREDIT, Pile à combustible, Matériaux, Génie civil, Eau et environnement, Pollution accidentelle. 3. RNRT, RNTL, RMNT. 4. Enterprises with fewer than 500 employees. 5. Enterprises with more than 500 employees. Source: French Ministry of Research.
© OECD 2004
Space and aeronautics EUR
1.78 0.11 1.38 0.75 0.60 0.46 5.09
Total
%
EUR
%
35 2 27 15 12 9 100
24.84 8.95 31.67 11.88 5.25 4.27 86.86
29 10 36 14 6 5 100
101
OECD Science, Technology and Industry Outlook 2004
Box 3.2. A special service unit to connect SMEs to a major P/PP – Kunstoffenhuis (Netherlands) The Dutch government does not provide specific incentives for SMEs to participate in P/PPs such as the four LTIs, including the Dutch Polymer Institute (DPI). However, several actors (the TNO, the Technical University of Eindhoven, and Fontys Hogescholen) have established a service unit (the so-called Kunstoffenhuis) to make the results from academic polymer research available to polymer-processing SMEs. This organisation facilitates knowledge transfer by offering consultancy and training and helps SMEs to become aware of developments in academic research, including the activities of DPI, and of possible benefits for their own business.
P/PPs are fragile constructions which must be long-lasting if they are to bear fruit. They are based on trust and their success depends on the existence of fairly shared, sustained mutual benefits. Efficient P/PPs build on bottom-up initiatives, stress competence as the main criterion for selection, and have only light top-down steering processes. Their integrity can easily be jeopardised by top-down interference, such as requirements governing the nature and identity of participants. SME participation should therefore be promoted with due care. Experience suggests that there are three main roads to improvement. The first, and most obvious, consists of ensuring that the portfolio of P/PPs (i.e. the set of co-operative ventures supported under a P/PP programme) gives sufficient space to the technological areas where smaller organisations are main actors. The second consists of lowering entry barriers by creating mechanisms which allow easy and inexpensive access to any P/PP through, for example, industry associates programmes. Typically, such programmes allow SMEs to become associated with a P/PP at nominal cost, thereby providing them with preferential access to information about the research outcomes and sometimes also access to the researchers. The third consists of circumventing entry barriers when these cannot be lowered without damaging the incentive structure of the P/PP. Box 3.2 gives the example of a service unit that connects Dutch SMEs to collaborative pre-competitive research in their field. Internationalisation Innovation networks are global, and foreign sources supply a large and increasing portion of external knowledge that firms and public institutions need to access to implement their research and innovation strategies. This applies to P/PPs even if the primary and legitimate goal of such partnerships is to strengthen linkages among domestic firms and public research organisations. Most of the necessary international linkages are secured outside the P/PP through participants’ networks, including inter-governmental S&T programmes, with indirect benefits for their joint ventures. However, international partners are increasingly needed at the core of most P/PPs.13
102
In practice, however, this need is only partly met, owing to too narrow a definition of national benefits from foreign participation and also sometime because of unhelpful regulations regarding public financing. Until recently only foreign firms domiciled in the Netherlands (those with an R&D or production presence in the country) could participate in subsidised research partnerships, providing also that they could demonstrate that the results would be exploited locally. In Austria, foreign firms can fully take part in a Kplus centre, subject to a maximum 25% of the industrial share (i.e. of the minimum 40% private contribution) and provided that benefits for Austria can be demonstrated. In Australia, one of the CRC programme’s selection criteria is an indication of how proposed international linkages will contribute to the CRC’s objectives. However, international collaboration with overseas firms is generally undertaken through Australian subsidiaries rather than through direct collaboration with foreign firms. © OECD 2004
Public/Private Partnerships for Innovation
In France, any foreign public or private organisation can take part in RRITs but none can enjoy government financial support. Another problematic area is the lack of synergy between national and international P/PP initiatives, such as the EU Framework Programme. This has been subject to debate in the Netherlands. The socalled anti-cumulation rule, which decrees that the total subsidy cannot exceed 50% of the total budget, makes it unattractive for the LTI to seek substantial additional funds, e.g. from the European Framework Programme, because such funds would not, or only marginally, increase the total budget.14 Evaluation Evaluation of public-private partnership programmes is not a straightforward task, especially because the costs and benefits of partnerships are inherently hard to measure, even though countries try to rely on quantitative indicators (Table 3.9). Benefits may be more indirect than direct, and the existence of multiple stakeholders may give rise to conflicts in terms of the objectives of evaluations. Programme managers and private stakeholders may be more interested in programme services and delivery than in broader economic impacts, while policy makers may seek macroeconomic outcomes such as employment and productivity effects. Another difficulty associated with evaluations is the often very long timeline of expected impacts. The evaluation of P/PPs needs new perspectives on the additionality of government funding to supplement the traditional private vs. social returns model. Additionality has a behavioural dimension. P/PPs often encourage networking and create lasting links within national innovation systems. Evaluation should place greater weight on how partnerships modify behaviour to create persistent beneficial effects. In Australia, this idea is emphasised by stating that CRC means not only “cooperative research centres” but also “changing the research culture”. Austria also sees measuring additionality as important (Box 3.3). One should also recognise that when the programme promotes pre-competitive research or innovation in the delivery of public services, the long-term, diffused or largely qualitative nature of its benefits makes almost meaningless the application of any additionality criteria. Despite these difficulties and gaps in evaluation methodologies, P/PPs have been subjected to quite close scrutiny, especially the CRCs in Australia, Kplus in Austria and LTIs in the Netherlands. For example, each CRC is formally evaluated in terms of its progress against the milestones of its agreement as well as more generally against the objectives of the CRC programme. Evaluations take place after one, two and five years and serve to provide feedback to centres and as input to any future
Table 3.9. Indicators for the evaluation of Dutch LTIs Criteria
Indicators
Market orientation and (inter)national relevance to industry
Number of industrial partners Contribution of industry to total budget (%) Number of established or transferred patents Number of licences sold to third parties Number of spin-off companies Number of institute researchers finding employment elsewhere in the field Procedures for performance measurement by industrial partners
International position
Number of EU projects with participation of the LTI EU funds in total budget (%) Contribution of international partners to total budget (%)
Scientific/academic position
Number of LTI papers in internationally refereed journals
Education
Number of completed PhDs
Governance, organisation, finance and efficiency
Ratio of indirect costs/total costs Expenditures for knowledge transfer
Source: Dutch Ministry of Economic Affairs.
© OECD 2004
103
OECD Science, Technology and Industry Outlook 2004
Box 3.3. The measurement of additionality in the Austrian Kplus programme The concept of additionality in its various dimensions (input, output, behavioural additionality) plays an important role in the Kplus programme at various levels of implementation. In particular, it is of importance in the following contexts: • Ex ante evaluation of centres. Evaluators are asked to provide an ex ante assessment, covering both scientific-technical and economic aspects. • Communication between TIG, the agency managing the programme, and Kplus centres. This includes TIG’s understanding of its role in negotiation processes (e.g. in defining the research agenda, IPRs, etc.). • Interim (four-year) evaluation. Consortia are asked to provide a statement. In addition, a standardised questionnaire is distributed to participating companies. The questionnaire focuses on quantitative information with an emphasis on input additionality, but also addresses some aspects of output and behavioural additionality. So far four centres have completed the questionnaire. • A future programme evaluation. Measuring additionality is likely to be a key concern.
application for an extension or a renewal of funding. The CRC programme as a whole has also attracted close attention and underwent external reviews in 1995, 1997 and 2003. The Austrian Kplus centres are subject to an interim evaluation after four years. The results determine the possibility of further public funding for a second term of another three years. In 2003, a first joint assessment of Kplus and Kind/Knet was made. The Dutch government requires that LTI activities be regularly monitored (annually) and evaluated (every four years) by the Technology Foundation STW, a part of the National Research Council. In France, RRITs are monitored by funding ministries to check that public money is used for good purposes, but the design of evaluation procedures is still under way. Such practices can help ensure that P/PPs achieve their potential in strengthening national innovation systems.
104
© OECD 2004
Public/Private Partnerships for Innovation
NOTES
1. For example, the government is usually very active in the design/initiation and completion/evaluation stages, while public research organisations are mainly involved in the implementation phase. 2. In practice, some such schemes, such as the Advanced Technology Program in the United States, involve twoway flows at various stages, e.g. in setting programme strategy and, once R&D is under way, in producing social benefits beyond the private returns to the firm. 3. For example, large companies in Netherlands have reduced or abolished their central research facilities. This has entailed a shift to more short-term and development-related work and the decline of business-performed basic research, making firms more dependent on the results of long-term research performed in the public sector. 4. All four Dutch LTIs carry out pre-competitive research on topics that are key to the future competitiveness of important Dutch industries. 5. As a result, some Austrian Competence centres have public good missions; examples are the Bioenergy Centre and the Centre for Natural Hazard Management. 6. These broad priorities are: an environmentally sustainable Australia; promoting and maintaining good health; frontier technologies for building and transforming Australian industries; and safeguarding Australia. 7. It is unlikely that there would have been two programmes in Austria if competencies in S&T policy had been concentrated in one ministry. A major reorganisation is under way and should put the two programmes, as well as the two implementing agencies (Technologie Impulse Gesellschaft [TIG] and FFF), under the same umbrella. 8. TIG, is a limited company owned by the Republic of Austria, as represented by Ministry of Transport, Innovation and Technology. TIG took over the organisation of the selection process, the implementation and monitoring of Kplus centres as well as programme-related information activities. 9. Under its Backing Australia’s Ability initiative, the Australian government has maintained its 125% R&D tax concession programme and has extended initiatives to encourage business expenditure on R&D: a tax offset to assist small companies, a 175% premium tax concession for additional R&D, and effective life treatment of R&D plant expenditure. 10. Interviews with stakeholders in some Australian CRCs revealed that many university professors are reluctant to participate in CRCs for various reasons: CRCs have a negative effect on the research traditions of academics; the university is losing control; CRCs cost the university in terms of staff, time and funds; because of the CRCs, professors lose time for their own curiosity-driven research; etc. Reciprocally, the business community complains about the public research sector’s lack of skills for project management and the “publish or perish syndrome”. 11. About 25% of the industrial partners in the Austrian Kplus centres are SMEs. 12. In the 2002 round, the Minister stated: “One of the strengths of the CRC Program has been its flexibility in the range of participants and operating structure of each individual CRC. I would like applicants to think innovatively about how they can better involve the many SMEs that make up an integral part of Australia’s industrial structure. It is important that Centres develop linkages with SMEs to facilitate technology transfer. I would also expect to see an increase in SME spin-offs coming out of the Program in the future.” 13. To overcome the insufficient ability of Australian firms to commercialise domestic scientific outputs, a niche strategy involving key foreign participants has been highly successful in the case of “Vision CRC”, whereas the continuing success of some CRCs (e.g. the Satellite Systems CRC and the Composite Materials CRC) depends now almost entirely on their ability to attract foreign partners with key complementary capabilities. 14. In order to avoid losing the extra subsidy that one LTI (Telematica) acquired through European projects, the subsidy ceiling was increased from 50% to 60%.
© OECD 2004
105
OECD Science, Technology and Industry Outlook 2004
REFERENCES OECD (2001), Science, Technology and Industry Outlook 2001 – Drivers of Growth: ICT, Innovation and Entrepreneurship, Paris OECD (2003a), “Partenariats public-privé pour la recherche et l’innovation – une évaluation de l’expérience française”. www.oecd.org/sti/innovation. OECD (2003b), “Public-private Partnerships for Research and Innovation – An Evaluation of the Dutch Experience”. www.oecd.org/sti/innovation. OECD (2004a), “Public-private Partnerships for Research and Innovation – An Evaluation of the Australian Experience”. www.oecd.org/sti/innovation. OECD (2004b), “Public-Private Partnerships for Research and Innovation – An Evaluation of the Austrian Experience”. www.oecd.org/sti/innovation.
106
© OECD 2004
© OECD 2004
Annex 3.A1
Table 3.A.1.1. Comparative features of four P/PP programmes CRCs (Australia)
Kplus, Kind/Knet (Austria)
RRITs (France)
LTIs (Netherlands)
1990
Kplus: 1998
1999
1997
Open
4 years
Duration Starting date
Kind/Knet: 1999 Period
7 years • Renewal rate: 60% over six distinct selection rounds
4 years with the possibility of extension for another three years.
• Funded for two rounds
Coverage Number of co-operative research centres (networks)
96 centres since inception, of which 18 Kplus centres 70 are currently operating 17 Kind/Knet centres/networks
16 networks
4 centres
Research fields
Varied
Varied
Varied
Focus on four areas (polymers, telecommunications, food sciences, metals technology)
Competitive – 15 out of the first 120 applications in 1991
Competitive
Competitive
Competitive – 4 out of 19 initial proposals
Participants Selection process
The selection of projects involves Evaluation by: two external Assessed through an independent, two phases: preparation and calls technical expert advisory panels; international peer review for proposals; and scientific national and international referees; expertise and project certification the CRC Committee 15 organisations on average, of which universities (40%), firms (32%), public labs (24%)
Participation of SMEs
Enhancing the participation of Kplus: about 25% of the industrial SMEs has become a higher priority partners are SMEs in the latest selection round Kind/Knet: the participation of SMEs is not mandatory but the guidelines include the technological needs of SMEs among the criteria for granting support to a competence centre
Require participation of at least one public research organisation and five companies
On average firms get 46% of public funding, compared to 36% for public labs and 20% for higher education institutions
20 companies and 8 public research organisations on average
Ensuring that SMEs participate in or benefit from co-operative research is an important objective of all RRITs
No specific incentives
The share of SMEs is limited (10%), partly owing to the research focus of LTIs (generic research in fields SMEs get at least 20% of the budget where SMEs are minor actors) appropriations, with their share rising to 43% in life science-based networks
107
Public/Private Partnerships for Innovation
Participants per centre
Evaluation by external group of experts
Participation of foreign companies
CRCs (Australia)
Kplus, Kind/Knet (Austria)
RRITs (France)
LTIs (Netherlands)
Collaboration within international research networks is an explicit selection criterion.
Foreign firms can fully take part in a Kplus centre
Foreign domiciled firms are allowed to participate in all RRITs
Non-domiciled firms, as well as foreign public research organisations, can participate, subject to government approval
Participation in international RTD programmes is included among evaluation criteria
Foreign researchers account for 21% of LTIs workforce
Out of 285 industrial partners participating in the 18 currently operating Kplus centres, 36 (i.e. 13%) are foreign Kind/Knet centres/networks have in general a dominant regional dimension. Financing Cost-sharing
Two thirds of all resources are provided by the CRC programme, universities, CSIRO and other Commonwealth organisations. Only one-quarter of the resources are provided by industry and other non-government sources
Up to 35% federal funds, a maximum 25% from other public sources, and a minimum 40% from industry.
Industry participation ranges from almost one-half to around onethird.
Government funding: at most 50%
Public research labs are deeply involved, representing from 27% of the budget appropriations for space and aeronautics to 42% in life sciences
Firms: at least 20%
Public research organisations: at least 20%
Participation of academic laboratories is very diverse: from 5% in life sciences to 19% in ICTs Self-sustainability
Self-sustainability is an objective but there are very few examples of CRCs reaching such stage
Self-sustainability is an objective
Organisational form (central or virtual)
Participants have considerable freedom to choose the arrangement they consider to be most appropriate to their particular needs
Most Kplus centres operate at one physical location
Legal status
Mostly unincorporated joint ventures, but incorporation is encouraged
Incorporated (limited companies)
Self-sustainability is not an explicit objective
By the end of 2007, LTIs should be self-sustained
Organisation RRITs are virtual networks made up Some are purely virtual, others of companies, laboratories, experts have a mixed organisational form Most Kind/Knet are virtual centres/ and representatives of government networks Special status
Incorporated (limited companies)
OECD Science, Technology and Industry: Outlook 2004
108
Table 3.A.1.1. Comparative features of four P/PP programmes (cont.)
© OECD 2004
© OECD 2004
Table 3.A.1.1. Comparative features of four P/PP programmes (cont.)
Intellectual property rights
Evaluation
CRCs (Australia)
Kplus, Kind/Knet (Austria)
RRITs (France)
LTIs (Netherlands)
No general rules for all centres
Kplus:
The government does not claim any share in the IPRs generated by CRCs
Basic research: all IPRs belong to the centre and each partner has the right to use the results
No explicit agreement about IPR allocation among partners – ad hoc basis
IPRs developed in the course of the research by a CRC belong to the CRC and in the case of CRCs which are not legal entities in their own right (i.e. unincorporated joint ventures) the IPRs are held by one of the public-sector partners on behalf of the CRC participants
Industrial research with partner companies: all IPRs belong to the centre and each partner of the project has the right to use the results.
RRITs have a minimal IPR policy, ensuring that all IPR issues are covered by an agreement between all those involved in a joint R&D project. For a project to be eligible, all actors must approve a prior draft IPR agreement. The actual details of the apportioning of IPRs among the various categories of actors, both private and public, are ad hoc arrangements between the parties and not subject to any specific policy or guidelines.
Each centre is formally evaluated after one, two and five years
Kplus have been so far subject to a more rigorous evaluation process than Kind/Knet:
The evaluation of research project proposals (project achievements) or the internal or external audit of operations, which are core tasks of good management practices of the RRITs
Extensive formal evaluation every four years
The CRC programme as a whole underwent external reviews in 1995, 1997 and 2003
Kind/Knet: IPR issues are addressed on an ad hoc basis
An ex ante evaluation After a first term of four years, interim evaluation An ex post evaluation after seven years
Public/Private Partnerships for Innovation
109
Australia (CRCs)
Manufacturing technology Advanced Composite Structures Bioproducts CAST Metals Manufacturing (CASTMM) Intelligent Manufacturing Systems and Technologies MicroTechnology Polymers Welded Structures Construction Innovation Functional Communication Surfaces Innovative Wood Manufacturing Railway Engineering and Technologies
Information and communication technology Satellite Systems Photonics Telecommunications Enterprise Distributed Systems Technology Sensor Signal and Information Processing Smart Internet Technology Technology Enabled Capital Markets Mining and energy Greenhouse Gas Technology Mining Technology and Equipment Hydrometallurgy Clean Power from Lignite Coal in Sustainable Development Landscape Environments and Mineral Exploration Predictive Mineral Discovery
© OECD 2004
Agriculture and rural-based manufacturing Sustainable Sugar Production Molecular Plant Breeding Sustainable Forestry Production Sustainable Rice Production Cotton Cattle and Beef Quality Tropical Plant Protection Viticulture Sheep Industry
Austria (Kplus and Kind/Knet)
France (RRITs)
Netherlands (LTIs)
Mechatronics Applied Biocatalysis Tribology Tech Research Applied Electrochemistry Light Metals Materials Polymers Wood Composites and Chemistry Industrial Mathematics Materials and Engineering for Aeronautics Wood Construction Wood Technology Wood Research Acoustic Automation Light Technologies
Earth and Space Aeronautics Land Transport Urban Planning and Civil Works Materials and Processes Nanotechnology
Polymers Metals
Advanced Computer Vision Telecommunications Knowledge Management Software Virtual Reality Electronic Commerce Interactive e-Business
Earth and Space Land Transport Telecommunications Nanotechnology Software Multimedia
Telematics
Bioenergy Renewable Energy
Fuel Cells
Génoplante
Food
OECD Science, Technology and Industry: Outlook 2004
110
Table 3.A.1.2. List of co-operative research centres (networks) currently operating, classified by technological field
© OECD 2004
Table 3.A.1.2. List of co-operative research centres (networks) currently operating, classified by technological field (cont.) Australia (CRCs)
Austria (Kplus and Kind/Knet)
France (RRITs)
Natural Hazard Management Recycling and Sustainable Product Development Environment-Friendly Engines Environment Technology Processes
Earth and Space Land Transport Water and Environment Technology Maritime Accidental Pollutions Urban Planning and Civil Works
Bio-Molecular Therapeutics Biopharmaceutical Technology Medicine Health Information Technologies
Génhomme Nanotechnology Health Technologies
Netherlands (LTIs)
Innovative Dairy Products Sustainable Aquaculture of Finfish Innovative Grain Food Products Environment Antarctica and the Southern Ocean Sustainable Tourism Environmental Biotechnology Biological Control of Pest Animals Catchment Hydrology Coastal Zone, Estuary and Waterway Management Freshwater Ecology The Great Barrier Reef World Heritage Area Greenhouse Accounting Tropical Rainforest Ecology and Management Weed Management Plant-based Management of Dryland Salinity Tropical Savannas Management Water Quality and Treatment Medical science and technology Aboriginal and Tropical Health Cellular Growth Factors Discovery of Genes for Common Human Diseases Eye Research and Technology Vaccine Technology Asthma Chronic Inflammatory Diseases Cochlear Implant and Hearing Aid Innovation Diagnostics
Public/Private Partnerships for Innovation
111
Chapter 4
PROMOTING INNOVATION IN SERVICES
Services play a key role in developed economies and accounted for 70% of total OECD value added in 2000. Boosting innovation in service industries is central to improving the performance of the service sector, but the sector has traditionally been seen as less innovative than manufacturing and as playing only a supportive role in the innovation system. Recent work confirms, however, that services are more innovative than previously thought and that knowledge-intensive business services play an increasingly dynamic and pivotal role in the knowledge-based economy. This chapter examines what is known about innovation processes in services, highlighting where possible how these differ from those in manufacturing. Drawing from the results of a recent OECD questionnaire, it identifies policy measures adopted in OECD countries to boost innovation in their economies.
113
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction Services play a key role in developed economies. They have expanded rapidly over recent decades and accounted for 70% of total OECD value added in 2000; market services (i.e. excluding government services) accounted for 50% of the total.1 Market services have become the main driver of the economy and the major contributor to productivity growth, especially as the use of ICT services has grown. Services are also the main source of job creation across the OECD area. While the service sector accounts for a lower share of total employment than of total output, market services was the only sector to make a positive contribution to job creation over the past decade in all OECD countries, and job creation in services often compensated for job losses in the manufacturing sector. Although servicesector jobs are often viewed as labour-intensive and characterised by low productivity, skills in the sector have undergone a rapid process of upgrading. As a result, the service sector attracts increasing attention from policy makers interested in boosting economic growth and job creation. Boosting innovation in service industries is central to improving the performance of the service sector. The sector has traditionally been seen as less innovative than manufacturing and as playing only a supportive role in the innovation system. As a result, national innovation policies have paid scant attention to services, and service-sector firms have not been active participants in governmentsponsored innovation programmes. Recent work confirms, however, that services are more innovative than previously thought; indeed, in some areas, they are more innovative than the average manufacturing firm. In fact, knowledge-intensive business services play an increasingly dynamic and pivotal role in the knowledge-based economy. Innovation surveys suggest that services innovate for many of the same reasons as manufacturing firms: to increase market share, to improve service quality and to expand product or service range. However, it is less well understood how innovation occurs in the service sector. Compared to manufacturing, most innovations in services appear to be non-technical and to result from small, incremental changes in processes and procedures that do not require much formal R&D. Developing policy to support service-sector innovation may therefore require new policies and programmes. This chapter aims to inform the framing of policies to promote innovation in services. It begins by examining what is known about innovation processes in services – including both drivers and impediments – highlighting where possible how these differ from those in manufacturing. Main statistical data comes from two OECD databases – the Structural Analysis database for industrial analysis (STAN) and the Analytical Business Enterprise Research and Development database (ANBERD) – and the third European Community Innovation Survey (CIS3). A better understanding of innovation processes in the service sector can help to show how they may differ from more traditional manufacturing- or R&D-oriented innovation processes. This chapter therefore emphasises specific aspects of the innovation process in services and paves the way for policy discussions on opportunities for measures designed to support innovation in services more directly. It draws on the most recent data, surveys and literature to provide an up-to-date view of services innovation. Finally, drawing from the results of a recent OECD questionnaire, it identifies policy measures adopted in OECD countries to boost innovation in their economies. Services are of growing importance in OECD economies
114
OECD economies are increasingly services-oriented. That is, they are increasingly dominated by industries that aim to deliver help, utility or care, and experience, information or other intellectual content. Most of their value added is intangible rather than incorporated in a physical product. The © OECD 2004
Promoting Innovation in Services
service economy has grown rapidly in recent years. In 2001, market services represented between 45% and 55% of total value added in most OECD countries, up from 35% to 45% in 1980 (Figure 4.1). Growth in the share of market services is apparent in almost all OECD countries, with the exception of some in eastern Europe (the Slovak Republic, Hungary and the Czech Republic) that have recently undergone significant structural reforms. Over the past decade, services have been the main driver of economic growth. Between 1990 and 2001 they contributed approximately two-thirds of the increase in value added in OECD economies (Figure 4.2). Two sectors, wholesale and retail trade and business services, made large contributions to GDP growth. Wholesale and retail trade generated over a quarter of output growth in many countries, and more than a third in the United States, Mexico, Spain, Sweden and Poland. Business services accounted on average for a third or more of output growth and more than two-thirds in Belgium, Japan and Hungary. This is partly due to the prominent size of these sectors in national economies, but also to their sharp rises in output. Growth in business services has benefited from recent changes in corporate management: increased investment in intangibles, growing emphasis on knowledge management, renewed focus on core competencies, outsourcing of some activities and greater reliance on external service providers. In the manufacturing sector, services previously produced in-house are increasingly obtained via outsourcing. By the mid-1990s, services accounted for nearly 25% of the value added embodied in final demand for manufactured goods in most countries for which data are available, compared to 15% or less in the early 1970s (Figure 4.3). The rise in embodied services was particularly strong in Australia, the Netherlands and Japan, all of which saw gains of 7 percentage points or more. It was less marked in Canada and the United States, although services already accounted for more than 20% of US manufacturing value added in the early 1970s. In most countries, the manufacturing sector now relies more heavily on telecommunications, business and computer services with a view to stimulating greater productivity. The service sector also makes sizeable contributions to job creation. Across the OECD, most employment growth in the 1990s was due to services, in particular business services, which generated more than half of all employment growth in most countries and often compensated for job losses in
Figure 4.1. Share of market services in total value added, 1980 and 2001 % 60
1980
2001
55
50
45
40
35
No rw ay Cz K ec o h Re rea pu b Po lic rtu ga Fin l lan Hu d ng ar y Sl ov Po ak la n Re d pu bl Sw ic ed De en nm ar Ca k na da Ja pa Au n st ria Sp Ge ain Ne rma th ny er lan Be ds lg iu m Fr an ce Ne I w taly Ze ala Au nd st ra l Un M ia ite ex d ico Ki ng do m Un Gre ite ec e d St at es
30
Source: OECD, Science, Technology and Industry Scoreboard 2003.
© OECD 2004
115
OECD Science, Technology and Industry Outlook 2004
Figure 4.2. Contribution of market services to GDP growth, 1990-2001 Market services versus manufacturing and other industries Average annual growth rates (%) Business sector services
Manufacturing
Others industries and services 6.0
Korea (1990-1999) Slovak Republic (1995-2001) Mexico (1990-2000) United States (1990-2001) Netherlands (1990-2000) Germany (1990-2000) Poland (1993-2000) Norway (1990-2001) Portugal (1990-1999) Czech Republic (1991-2001) Canada (1990-1999) United Kingdom (1990-1999) Austria (1990-2001) Belgium (1990-2001) Japan (1990-1998) Denmark (1990-2000) Sweden (1990-2001) Italy (1990-2001) Spain (1990-1999) France (1992-2000) Finland (1990-2001) Hungary (1992-2000)
3.7 3.6 2.8 2.9 2.5 4.8 3.3 3.0 0.9 2.1 2.0 2.6 2.0 1.8 2.0 1.9 1.6 2.2 1.8 2.1 2.3 -1
0
1
2
3
4
5
6
7 %
Market services alone, by service Average annual growth rates (%) Wholesale and retail trade Financial intermediation
Transport and communications Business services
Korea (1990-1999) Slovak Republic (1995-2001) Mexico (1990-2000) United States (1990-2001) Netherlands (1990-2000) Germany (1990-2000) Poland (1993-2000) Norway (1990-2001) Portugal (1990-1999) Czech Republic (1991-2001) Canada (1990-1999) United Kingdom (1990-1999) Austria (1990-2001) Belgium (1990-2001) Japan (1990-1998) Denmark (1990-2000) Sweden (1990-2001) Italy (1990-2001) Spain (1990-1999) France (1992-2000) Finland (1990-2001) Hungary (1992-2000) -0.5
116
0
0.5
1.0
1.5
2.0
2.5
3.0 %
Source: OECD, STAN database, March 2004.
© OECD 2004
Promoting Innovation in Services
Figure 4.3. Service-sector value-added embodied in manufacturing goods Percentage of total value added of manufactured goods in final demand % 30
Early 1970s
Mid-1970s
Early 1980s
Mid-1980s
Early 1990s
Mid-1990s
25
20
15
10
5
0
Australia
Canada
Denmark
France
Germany
Japan
Italy
Netherlands
United United States Kingdom
Source: OECD, STI Scoreboard 2003.
manufacturing (Figure 4.4). Within the service sector, the largest relative job growth was in wholesale and retail trade and business services. In the 1990s, the former supported more than half of employment growth in eastern Europe (the Slovak Republic, Hungary and Poland), Korea, Canada, Spain, the United Kingdom and Denmark. The latter were a significant source of employment growth in Europe (the Netherlands, Portugal, Italy, France and Belgium), the Nordic countries (Norway, Sweden and Finland) and Japan. Services also make a major contribution to labour productivity growth. While the service sector has traditionally been viewed as a sector with poor productivity growth, measurement problems are to some extent responsible: services output is difficult to define, and changes in services quality are hard to measure. Market services, however, account for the bulk of labour productivity growth in many OECD countries, including the United States, the United Kingdom and Germany (Figure 4.5). The manufacturing sector remains important in some of the newer member countries, including Hungary, Poland and Korea, which had the highest levels of labour productivity growth. In other countries, increases in total labour productivity tend to be driven by the service sector. The growing contribution of market services to productivity is linked both to their growing share in total value added and to a strong rise in their labour productivity. The so-called knowledge-based market services have been particularly important: post and telecommunications, finance and insurance, and business services. These sectors tend to have the largest investments in R&D among service-sector industries, as illustrated below, and the greatest reliance on highly skilled workers. In 2000 knowledge-based market services accounted for 19% of total value added (OECD, 2003). Moreover, the share of knowledge-based market services in total value added increased between 1990 and 2001 (Figure 4.6). Growth was particularly marked in eastern Europe (Hungary and the Slovak Republic), the Netherlands, Iceland, the United States and Luxembourg. Much of this growth derived from business services, which grew faster than post and telecommunications or finance and insurance. Innovation in services Innovation has been recognised as a key to growth (OECD, 2001b), but the role of service-sector innovation has long been under-appreciated. This is due to some extent to the difficulty of measuring © OECD 2004
117
OECD Science, Technology and Industry Outlook 2004
Figure 4.4. Contribution of market services to job creation, 1990-2001 Market services versus manufacturing and other industries Average annual growth rates (%) Business sector services
Manufacturing
Others industries and services 1.4
Korea (1990-99) Netherlands (1996-00) Slovak Republic (1995-97) Portugal (1990-99) United States (1990-01) Canada (1990-99) Spain (1990-99) Austria (1990-01) Poland (1993-00) United Kingdom (1990-99) Italy (1990-01) France (1990-99) Norway (1990-01) Hungary (1993-01) Belgium (1990-00) Denmark (1990-00) Japan (1990-98) Sweden (1990-00) Finland (1990-01)
2.6 1.4 0.7 1.4 1.2 1.4 0.5 0.3 0.1 0.5 0.4 0.9 -0.6 0.5 0.3 0.7 -0.6 -0.6 -1.5
-1.0
-0.5
0
0.5
1.0
1.5
2.0
2.5
3.0 %
Market services, by industry Average annual growth rates (%) Wholesale and retail trade Financial intermediation
Transport and telecommunications Business services
Korea (1990-99) Netherlands (1996-00) Slovak Republic (1995-97) Portugal (1990-99) United States (1990-01) Canada (1990-99) Spain (1990-99) Austria (1990-01) Poland (1993-00) United Kingdom (1990-99) Italy (1990-01) France (1990-99) Norway (1990-01) Hungary (1993-01) Belgium (1990-00) Denmark (1990-00) Japan (1990-98) Sweden (1990-00) Finland (1990-01) -0.5
0
0.5
1.0
1.5
2.0 %
Source: OECD, STAN database, March 2004.
118
© OECD 2004
Promoting Innovation in Services
Figure 4.5. Breakdown of labour productivity growth by main industrial sector % 5
Business sector services
Manufacturing
Other industries
0.4 0.8 3.2 0.8 1.1 1.5 1.4 1.4 1.0 2.1 1.5 2.3 1.7 4.2 3.0 2.2 1.6 2.0 4.3 2.5 2.7 2.1 2.0 Labour productivity growth of total economy, 1995-2001 or nearest year available
4
3
2
1
0
Ita Hu ly n Ne g w ary Ze ala nd Fr an ce Ja pa Be n lg iu De m nm Ne a th rk er lan ds Au st Ge ria rm an y Sw ed en Ca na da Ko re Fin a lan Un Po d ite rtu g d Ki al ng do Au m st ra lia Po lan d No rw ay Gr ee ce M Un ex ite ico d St at es
Sp ain
-1
Source: OECD, Science, Technology and Industry Scoreboard 2003.
Figure 4.6. Expansion of knowledge-based market services, 1990-2001 or nearest available year Share of total value added (%) Post and telecommunications
Finance and insurance
Luxembourg United States Australia Turkey United Kingdom Netherlands France Germany Total OECD European Union New Zealand Italy Austria Sweden Canada Hungary Japan Denmark Czech Republic Spain Iceland Finland Slovak Republic Korea Greece Norway Mexico
Business services
2001 1990
0
5
10
15
20
25
30
35
40 %
Note: The European Union aggregate includes Austria, Denmark, Finland, France, Germany, Ireland, Italy, Portugal, Spain, Sweden, and the United Kingdom. Source: OECD, STAN database, March 2004.
© OECD 2004
119
OECD Science, Technology and Industry Outlook 2004
innovation in the service sector, a patchwork of different industries with significantly different innovation processes. R&D expenditures are often employed as a proxy for innovation, although they measure just one input into the innovation process. An increasing number of innovation surveys, however, have made clear that expenditure on R&D is only one element of firms’ expenditures on innovation. Even in manufacturing, R&D generally amounts to only about half of total investment in innovation (OECD, 2001b); in services the share is even smaller. Other components of innovation appear more important for services, where most innovation is linked to changes in processes, organisational arrangements and markets. There is evidence that innovative activity in services is organisational and disembodied in nature so that it escapes standard measures of innovation (de Laat et al., 1997). Various innovation surveys attempt to capture these complementary dimensions (see Box 4.1 for information on the Community Innovation Survey used in many European countries). Service-sector innovation varies considerably by sector and firm size Innovation surveys indicate that service-sector firms are innovative, although less so, in aggregate, than firms in manufacturing industries. Between 1998 and 2000, the share of service-sector firms reporting that they were innovative (i.e. that they had introduced an innovation during the period) ranged from more than 55% in Germany to about 25% in Spain (Figure 4.7). In nearly all countries,
Box 4.1. Interpreting the results of the CIS3 survey The Community Innovation Survey aims to gather information on business innovation across the EU area. It attempts to capture the nature of innovation activities, the characteristics of innovative firms and the factors hampering innovation. Detailed results of CIS3 are available from 15 European countries – EU members prior to 1 May 2004, less the United Kingdom, plus Iceland.* Responses refer to the period 1998-2000 and come from 488 000 respondent firms in the manufacturing, market services and other industry sectors that employ more than ten persons. The CIS3 survey defines an innovation as “a new or significantly improved product (goods or service) introduced to the market or the introduction within the enterprise of a new or significantly improved process”. Innovation is based on the results of new technological developments, new combinations of existing knowledge or utilisation of other knowledge acquired by the enterprise. Product innovation is defined as a good or service which is either new or significantly improved with respect to its fundamental characteristics, technical specifications, incorporated software or other immaterial components, intended uses or user friendliness. Process innovation includes new and significantly improved production technology, new and significantly improved methods of supplying services and of delivering products. The outcome should be significant with respect to the level of output, quality of products (goods/services) or cost of production and distribution. The innovation should be new to the enterprise; it is not necessarily new to the market. The enterprise is not necessarily the first to introduce this process. It does not matter whether the innovation was developed by the enterprise or by another enterprise. Changes of solely an aesthetic nature, resale of inventions wholly produced and developed by other enterprises, and solely organisational or managerial changes are not included. Results of the CIS3 survey can be analysed to compare responses by country, industry and size class, but care must be taken in interpreting the results. Aggregate indicators are influenced by the structural characteristics of the set of responding firms, which differ from those of the total firm population. The set of CIS3 respondents contains an over-abundance of German and Italian firms, which together account for almost half of all respondents (Figure 4.a). German firms account for a third of all service-sector enterprises, whereas Italian firms represent a third of manufacturing firms. German respondents are particularly over-represented in business services and in transport and communications, and the latter sector contains no responses from French firms (Figure 4.b). A breakdown by size class indicates a similar bias in the population of small- and medium-sized firms (firms with fewer than 250 employees), with an over-representation of German and French firms. By design, firms with fewer than ten employees are not included. * The UK participated in CIS3 but did not provide detailed microdata to Eurostat, only aggregated data tables. 120
© OECD 2004
Promoting Innovation in Services
Box 4.1. Interpreting the results of the CIS3 survey (cont.) Figure 4.a. CIS3 respondents by sector and country As % of all responding firms All sectors
C
Others 17%
21% 19%
4%
France 9%
16%
A
15%
Portugal 5% Netherlands 5%
Italy 25%
19%
B
6%
6% 4%
7% 9% 2%
7% 8%
A. Manufacturing B. Services C. Other industries
32%
29% 33%
16%
18%
Germany 24%
13% 16%
Spain 15%
Figure 4.b. CIS3 respondents by service sector and country % of all responding service firms
K
Others 17%
J 23% 20%
Portugal 1% Netherlands 5%
France 11%
19%
G
19%
16%
G. Wholesale and retail trade 3% I. Transport 5% and communications 3% J. Financial 7% 8% intermediation 0% K. Business and 9% other services
24% 27% 37%
11% 14%
Spain 7%
Italy 13%
17%
I
17%
Germany 46%
12% 9%
121
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Figure 4.7. Innovative density in the service and the manufacturing sectors, 1998-2000 Share of innovative firms in each sector, as a % of firms in each sector Manufacturing
% 70 60 50 40 30 20 10
Sp ain
ly Ita
Gr ee ce
No rw ay
Fr an ce
De nm ar k
Fin lan d Ne th er lan ds
Be lg iu m
ria st Au
Sw ed en
Po rtu ga l Lu xe m bo ur g
Ic ela nd
Ge rm an y
0
Source: OECD, based on EUROSTAT, CIS3 survey 2004.
however, the share of innovative service-sector firms in the population of service-sector firms (i.e. the innovative density of service-sector firms) was below that of manufacturing firms.2 In Germany, for example, 65% of manufacturing firms reported that they had introduced an innovation vs. 55% of service-sector firms; in Spain, almost 40% of manufacturing firms were innovative vs. 25% of service firms. The largest gaps are found in Belgium, Denmark and the Netherlands, where the difference in innovative density between manufacturing and service-sector firms approaches 20 percentage points. Only in Iceland, Portugal and Greece was the innovative density of service-sector firms higher than that of manufacturing firms. Despite the overall trend, considerable variation exists, with some services appearing to be more innovative than the manufacturing sector average. Reported innovative density is highest in business services and financial intermediation, with CIS3 results indicating that more than 60% and 50% of firms, respectively, were innovative (Figure 4.8). In wholesale and retail trade and transport and communication, fewer than 40% and 30% of firms, respectively, reported that they were innovative. These figures compare to an average of just below 50% in manufacturing industries. The two least innovative sectors, wholesale and retail trade and transport and communication, account for 60% to 80% of the population of service-sector firms in the CIS3 survey and thus contribute heavily to the service sector’s lower average level of innovation. It is likely that the communication sector exhibits higher levels of innovation, but it is not possible to disaggregate the data to a sufficient level. Significant differences in innovative performance also exist across firm size. Large service-sector firms (250 or more employees) appear to be considerably more innovative than small firms (fewer than 50 employees) and medium-sized firms (50-249 employees). In the CIS3 survey, for example, some 75% of large firms reported that they were innovative, compared to less than 40% of small firms (Figure 4.9). The widest gaps in innovative density between large and small firms tended to be in larger European economies – Germany, France, Italy and Spain – where the gaps tended to exceed 30 percentage points; in smaller, Nordic countries the gaps were 20 percentage points or less. Not surprisingly, the vast majority of firms in the service sector are small; in the CIS3 survey, small firms accounted for more than 80% of all service sector firms, compared to 75% in manufacturing. Other studies have found that the relationship 122
© OECD 2004
Promoting Innovation in Services
Figure 4.8. Average innovative density in the services and manufacturing sectors, 1998-2000 Innovative firms as a % of firms of each sector % 70 60 50 40 30 20 10 0 Wholesale and retail trade
Transport and communications
Financial intermediation
Business services
Manufacturing
Note: The data shown in this chart reflect an average for all responses to the CIS3 survey. They have not been weighted to account for the sampling bias outlined in Box 4.1. Source: OECD, based on Eurostat, CIS3 survey data.
Figure 4.9. Innovative density by size class, 1998-2000 As a % of all firms % 100
10 to 49 56.9
56.0
50.1
46.4
48.0
44.9
50 to 249 42.4
39.9
36.5
More than 250 38.4
33.8
32.5
33.8
25.3
24.5
Innovation density in total services (%)
75
50
25
Source: OECD, based on data from Eurostat, CIS3 survey 2004.
© OECD 2004
Sp ain
ly Ita
Fr an ce
Gr ee ce
No rw ay
De nm ar k Ne th er lan ds
Fin lan d
ria Be lg iu m
st Au
Po rtu ga l Sw ed en Lu xe m bo ur g
Ic ela nd
Ge rm an y
0
123
OECD Science, Technology and Industry Outlook 2004
Figure 4.10. Breakdown of small firms by sector, innovative versus non-innovative firms, 1998-20001 As a % of all small innovative/non-innovative firms
B Wholesale and retail trade 19.5%
A 22.4% Manufacturing and other industries 55.9%
A. Non-innovative 51.5%
B. Innovative
12.6%
Transport and communications 6.7% Financial intermediation 4.4%
4.1% 9.5%
Business services 13.4%
1. Firms employing between 10 and 49 persons. Source: OECD based on data from Eurostat, CIS3 survey 2004.
between firm size and innovation is weaker in services than in manufacturing, suggesting that economies of scale may be less important in the service sector (European Commission, 2004). As with the general population of firms, the innovativeness of small firms varies considerably by industry sector. Small firms tend to be more innovative in knowledge-intensive services: business services and financial intermediation. These two sectors had 14% of non-innovative small firms and 18% of innovative small firms between 1998 and 2000 (Figure 4.10). The relatively large size of the wholesale and retail trade and transport and communications sectors again weighs down the overall average of small firms in the service sector. Nevertheless, there is evidence that small firms in the computer services sector (a sub-element of business services) are as likely to innovate as large firms in that sector (European Commission, 2004). The nature of innovation differs in services
124
It has long been recognised that innovation in the service sector differs from innovation in the manufacturing sector. Some have characterised the process of service innovation as a “reverse product cycle” (Barras, 1986; OECD, 1996; OECD, 2001a) in which a firm first adopts new technology (for instance ICT) to improve the efficiency of an existing process; next, the improved process generates a significant improvement in the quality and delivery of the services provided; and finally it becomes evident that the new technology provides the basis for an entirely new service, usually in a different field. Others suggest that innovation in services is mostly non-technical and occurs with small and incremental improvement in processes and procedures (OECD, 2000). Sundbo and Gallouj (1998) distinguish among four types of innovation – product innovation, process innovation, organisational innovation and market innovation – and highlight the latter two as being most pronounced in the service sector. Ad hoc innovation, i.e. a specific solution to a particular problem posed by a customer, is a fifth type of services innovation, typically made in interaction with the client (OECD, 2001a). Innovation by service firms relies heavily on communication with clients, and they frequently engage in ad hoc innovation (Kuusisto and Meyer, 2003). © OECD 2004
Promoting Innovation in Services
Innovation surveys do not cover the full spectrum of innovation models, but they do suggest that few firms engage in only one type of innovation. Generally product, process and organisational innovation occurs together. According to the CIS3 survey, between 60% and 90% of innovative firms introduced new products on the market; between one-third and two-thirds also introduced new processes (Figure 4.11). Although product innovation is more frequent, many innovative firms engage in both types of innovation. Moreover, the innovation surveys indicate that: i) firms in both the manufacturing and service sectors engage in product innovation; ii) in many countries, innovative service firms are more likely than innovative manufacturing firms to introduce new products; and iii) the largest differences between service firms and manufacturing firms relate to process innovations, which were reported more frequently by manufacturing firms. It would be hasty to conclude from these results that service-sector firms are more strongly oriented towards product innovation than manufacturing firms. Several interpretations may be offered to explain these results, including ad hoc innovation, which mainly stimulates product innovation. De Jong et al. (2003) suggest that the usual distinction between product and process innovations does not apply in service sectors. One clear difference between innovation in services and manufacturing is that services appear to rely less on R&D as a key driver of innovation. Although R&D is only one element of innovation in manufacturing, investments in R&D are closely correlated with innovative performance. In countries with higher levels of business R&D as a share of GDP, the share of innovative firms is also larger (Figure 4.12). The correlation is weaker in the service sector, where levels of R&D spending as a share of GDP are far below those of the manufacturing sector.3 In many countries, the R&D intensity of the service sector is less than 10% that of the manufacturing sector. This does not mean that R&D is not important to service-sector firms, but it suggests that R&D generally plays a smaller role in servicesector innovation. Innovation surveys provide some insight into other factors that contribute to innovation and their relative importance in service and manufacturing industries. Business innovation depends on firms’ ability to create, acquire and manage knowledge. They can do this in a variety of ways, ranging from
Figure 4.11. Product and process innovation in service and manufacturing sectors, 1998-2000 As a % of all innovative firms Product introduction in services Process introduction in services
Product introduction in manufacturing Process introduction in manufacturing
90
80
70
60
50
40
Source: OECD, based on Eurostat, CIS3 survey 2004.
© OECD 2004
Po rtu ga l
Sp ain
ly Ge rm an y
Ita
Gr ee ce
ria st Au
Sw ed en
De nm ar k Lu xe m bo ur g
No rw ay
Be lg iu m
Fr an ce
Ne th er lan ds
Fin lan d
Ic ela nd
30
125
OECD Science, Technology and Industry Outlook 2004
Figure 4.12. Average intensity of business R&D expenditure (1995-2000) and innovative density (1998-2000), by sector Average BERD as a % of value added in industry and innovative density as a % of all firms Manufacturing Services Innovation density, 1998-2000 As a % of total firms 70
A. Manufacturing
60
Innovation density, 1998-2000 As a % of total firms 70
60
Belgium
Germany
Netherlands Austria
Iceland Denmark
50
Finland
Portugal
France
Iceland
Portugal
50
Sweden
Sweden
Italy Norway Spain
40
B. Services
Germany
Austria Belgium Finland Netherlands
40
France Greece 20
0
0.5
Norway
Greece
30
30
Denmark
Italy Spain 1.0
1.5
2.0 2.5 3.0 3.5 4.0 4.5 Average BERD intensity, 1995-2000 As a % of GDP
20
0
0.1
0.2
0.3 0.4 0.5 0.6 0.7 0.8 Average BERD intensity, 1995-2000 As a % of GDP
Source: OECD, based on data from Eurostat, CIS3 survey 2004, and ANBERD database, 2004.
conducting R&D internally to financing R&D in other organisations, acquiring know-how from other firms via licensing, deploying new machinery and deploying it in novel ways, or investing more in training, design or marketing (Box 4.2). Important distinctions appear to exist between manufacturing and service firms in their reliance on these different mechanisms. Although acquisition of machinery and equipment was the top innovative activity reported by manufacturing and service firms in the CIS3 survey (Figure 4.13), it was not cited as frequently by service companies as by manufacturing companies (61% versus 57% among service firms). More importantly, manufacturing firms place much greater emphasis on internal R&D, ranking it a close second to acquisition of machinery; service firms place it third, just behind investments in training. Compared to manufacturing firms, service firms also tended to report higher reliance on the external acquisition of knowledge, although they were about equally likely to finance external R&D. R&D, internal or external, remains a privileged knowledge resource for manufacturing firms, whereas training or knowledge acquisition – patents, software or licences – better fit services’ needs. Likewise, service firms seem to put more emphasis on marketing of innovations (35% of innovative service firms vs. 30% of innovative manufacturing firms), while manufacturing enterprises focus instead on production, delivery or design improvements. R&D performance supports services innovation
126
In spite of the fact that the service sector relies less on R&D for innovation, service-sector investments in R&D appear to be rising. Between 1990 and 2001, service-sector R&D increased at an average annual rate of 12% across the OECD, compared to approximately 3% in manufacturing (Figure 4.14). Large differences between growth rates in services and manufacturing are most pronounced in countries such as the United States, Japan, Germany, the Netherlands, France and Spain. While a considerable portion of the rapid growth in service-sector R&D statistics is due to better measurement © OECD 2004
Promoting Innovation in Services
Box 4.2. Activities which contribute to innovation Intramural research and experimental development (internal R&D): all creative work undertaken within the enterprise on a systematic basis in order to increase the stock of knowledge, and the use of this stock of knowledge to devise new applications, such as new and improved products (goods/services) and processes (including software research). Acquisition of R&D (external R&D): activities as above, but performed by other companies (including other enterprises within the group) or other public or private research organisations. Acquisition of machinery and equipment: any advanced machinery, computer hardware specifically purchased to implement new or significantly improved products (goods/services) and/or processes. Acquisition of other external knowledge: purchase of rights to use patents and non-patented inventions, licences, know-how, trademarks, software and other types of knowledge from others for use in the enterprise’s innovations. Training: internal or external training of personnel directly aimed at the development and/or introduction of innovations. Market introduction of innovations: including internal or external marketing activities directly aimed at the market introduction of the enterprise’s new or significantly improved products. It may include preliminary market research, market tests and launch advertising, but it excludes the building of distribution networks to market innovations. Design, other preparations for production/deliveries: procedures and technical preparations to realise the actual implementation of products and process innovations not covered elsewhere. Source: Eurostat, CIS3 questionnaire.
Figure 4.13. Share of innovative firms by activity, 2000 As a % of all innovative firms, country average from CIS countries reviewed Services
% 70
Manufacturing
60 50 40 30 20 10 0 Acquisition of machinery and equipment
Training
Intramural R&D
Market introduction of innovations
Design, production, delivery
Acquisition of knowledge
External R&D
Note: It is not possible to construct a true European average as the CIS sample does not take into account country weights. For readability purposes, indicators have been aggregated to illustrate common behaviour. Figures are merely indicative and should be considered as such. Source: OECD, based on Eurostat, CIS3 survey 2004.
© OECD 2004
127
OECD Science, Technology and Industry Outlook 2004
Figure 4.14. Growth of business R&D expenditures, 1990-2001 Average annual growth rates (%) Manufacturing
% 50 40 30 20 10 0 -10
Slovak Rep. (1992-2001)
United Kingdom
Czech Rep. (1992-2001)
Poland (1994-2001)
Switzerland (1996-2000)
Norway (1991-2001)
Belgium (1992-2001)
Italy
New Zealand
Australia
Canada
Hungary (1993-2001)
United States
Greece (1991-1999)
Spain
Denmark
France
European Union (1995-2001)
Netherlands
Total OECD (1995-2001)
Portugal
Finland (1991-2001)
Austria (1993-1998)
Japan
Germany (1991-2001)
Korea (1995-2001)
Ireland
Sweden (1991-2001)
Iceland
Turkey (1990-2000)
Mexico (1992-2001)
-20
Note: Total OECD and European Union are estimates. The European Union aggregates include EU member countries except Luxembourg, plus the Czech Republic, Hungary, Poland and the Slovak Republic (since 1 May 2004). Differences in the way countries report services R&D data limit the degree of comparability across countries. Source: OECD, ANBERD database 2004.
and reclassification of firms, it also reflects real increases in R&D by service-sector firms, driven by competitive demands or by increased outsourcing of R&D by manufacturing firms and government. Available evidence also suggests that R&D has been growing faster than value added in services, reflecting its increased importance. R&D spending as a share of value added (R&D intensity) in services is still considerably below that in manufacturing. Whereas R&D spending in the manufacturing sector is above 1% of total value added in half of all OECD countries for which data are available – and 2% or more of value added in seven countries – R&D intensity in the service sector remains below 0.5% in most countries (Figure 4.15). However, R&D intensity in services has increased quickly in most OECD countries, even in many in which manufacturing R&D intensity has declined. Iceland, Sweden, Denmark and the United States show relatively high R&D intensity in the service sector (more than 1%) and high rates of growth, as each added a half-point or more of R&D intensity during the decade. In Norway, Australia and Portugal, R&D intensities in services and manufacturing are about equal.4
128
Nevertheless, service-sector R&D remains highly concentrated. In most countries, business services and post and telecommunications account for more than three-quarters of R&D intensity. Within these broad categories, computer and related services, R&D services and telecommunications services account for almost the entirety. These three sectors, and computer and related services in particular, account for most of the growth in R&D intensity over the last decade (Figure 4.16). In Korea, Germany, Portugal and the Netherlands, R&D intensity in the computer and related services industry increased more than 25% annually in recent years, and the Korean R&D service sector has seen increases of the order of 75% a year. This highlights the fact that service-sector R&D varies considerably across industries, as is also the case in manufacturing. © OECD 2004
Promoting Innovation in Services
Figure 4.15. Business R&D intensity in services and manufacturing, 1990 and 2001 As a % of total value added in industry (%) % 3.0
Manufacturing, 2001
Services, 2001
1990
4.0
2.5
2.0
1.5
1.0
0.5
Sw ed Icel en an (9 d 1 De -01) Un nm i F ted ar Sw inla St k n itz d ate er (9 s la 1No nd ( 01) rw 96 ay -00 (9 ) 10 Ca 1) na Au Au da st str ria al Ko (93 ia re -9 a ( 8) 95 -0 1 Ja ) p Un a ite Ire n Be d K land lg ing iu m dom Cz ( ec h Ne 92-0 Re th 1 pu er ) bl lan ic (9 ds 201 ) S pa Ge rm F in an ran y ( ce 91 -0 Sl ov Po 1) ak N rt e u Re w ga pu Ze l bl ala ic (9 nd 301 Hu ) ng ar Ita y Gr (9 ly ee 3M ce ( 01) ex 91 ic -9 Po o (9 9) lan 2d 01) (9 401 )
0
Note: R&D intensity is defined as business enterprise R&D (BERD) as a share of total value added in industry. Differences in the way countries report services R&D data limit the degree of comparability across countries. Source: OECD, ANBERD and STAN databases 2004.
Embodied knowledge is a key driver of innovation in the service sector As indicated above, investment and equipment are a main source of innovation in service-sector firms. The service sector has traditionally furnished the bulk of tangible investments in buildings, structures and equipment. It accounts for the largest share of the total economy and its investment intensity (ratio of gross fixed capital formation to gross value added) has been substantially higher than that of the manufacturing sector over the past decades (Figure 4.17). In 2000, manufacturing firms in the OECD area devoted on average around 5% of value added to capital investments, whereas services invested between 10% and 20% of value added. Real estate is responsible for most of these investments. However, services such as transport and communication are highly capital-intensive owing to their large investments in infrastructure. Others, such as wholesale and retail trade or financial and business services, are becoming more capital-intensive over time. ICT-related expenditures have been the most dynamic component of investment in recent years. The share of ICTs in total non-residential investment doubled, and in some cases quadrupled, between 1980 and 2000 (Figure 4.18). In 2001, the share of ICTs was particularly high in the United States, the United Kingdom and Sweden. The growth of investments in ICT products has been accompanied by a boom in investments in ICT services; software has been the fastest-growing component of ICT investment. In many countries, its share in non-residential investment multiplied several times between 1980 and 2000. In Sweden, Denmark and the United States, software accounted in 2000 for over 15% of total investments (Figure 4.19). Tapping into outside sources of knowledge Acquisition of external knowledge (patents, copyrights, software, licences, etc.) feeds non-technical innovation, particularly in knowledge-intensive business services where this type of innovation is increasingly dynamic. Sources of information can be diverse, but access to information networks is vital. Manufacturing and services firms that are involved in innovation tend to use to similar sources of © OECD 2004
129
OECD Science, Technology and Industry Outlook 2004
Figure 4.16. Growth of R&D intensity, services sector, 1990-2001 Average annual growth rates (%)
Computer and related
All services
Other business services
Telecommunications
R&D
n.a.
n.a.
Slovak Rep. (1994-2000) Czech Rep. (1992-2001) United Kingdom Switzerland (1996-2000) Poland (1994-2001) Norway (1991-2001) Belgium (1992-2001) New Zealand Italy Australia Hungary (1993-2001) Canada United States Greece (1991-1999) Denmark Spain France Netherlands Finland (1994-2001) Portugal Austria (1993-1998) Germany (1995-2001) Korea (1998-2001) Sweden (1995-2001) Ireland Iceland
n.a. n.a.
n.a.
n.a. n.a.
n.a.
n.a.
n.a. n.a. n.a. n.a. n.a.
n.a.
n.a. n.a. n.a.
-50 -25 0 25
50 -50 -25 0 25
50 -50 -25 0 50
%
%
100 -50 -25 0 25
%
50 -50 -25 0 50
%
100
%
Source: OECD, ANBERD and STAN databases 2004.
information (Figure 4.20); they rely most on their own resources, followed by their suppliers, customers and even competitors. Previous European surveys found that the more innovative the firm, the more important are customers as sources of information (Sundbo and Gallouj, 1998). Previous OECD work (2001a) indicated that research in services may be aimed at improving the interface with customers. Improvement of connections between firms and customers develops a two-way circulation of knowledge. Service and manufacturing firms differ most in their use of information from other enterprises within their group. Both types of firms rank this source of information relatively low, but more than 30% of innovative services firms report using it, compared to 20% of manufacturing firms. This result may highlight the greater importance of inter-firm technology transfer in the service sector, especially as service firms report less reliance than manufacturing firms on internal sources of information for innovation.
130
Neither sector reports significant use of information from public-sector organisations (governments or universities), but firms that rely more heavily on science-based innovation are likely to interact with such institutions more frequently. Indeed, strengthening industry-science linkages is a main focus of policy makers concerned with innovation. In most countries, more than three innovative firms out of four in the service sector did not use university or government resources. The public sector is currently the least important actor in services innovation (Sundbo and Gallouj, 1998). Two reasons for this situation have been advanced. One is that public research institutions, including universities, business schools and government administrations, are not oriented towards satisfying the demands and solving the problems of service firms. The other is a weak relationship between service firms and the public sector. © OECD 2004
Promoting Innovation in Services
Figure 4.17. Investment intensity in market services, 2001 Gross fixed capital formation as a % of total value added Manufacturing
% 25
20
15
10
5
Ita ly Po lan d Sw ed Un en ite Un d S ta ite te d s Ki ng do m Ca na da
No rw ay
Ko re a Be lg iu m
Au s Ne tria th er Sl lan ov ds ak Re pu bl ic Po rtu ga l Fin lan d Ge rm an y Fr an ce De nm ar k Hu ng Cz ec ar y h Re pu bl ic
0
Source: OECD, STAN database, April 2004.
Figure 4.18. ICT investment1 in OECD countries, 1980-2001 Percentage of non-residential gross fixed capital formation, total economy (%) % 30
1980
1990
20012
20
10
Ita ly Fin lan d Be lg iu m Ge rm an y Ja pa n De nm ar k Au st ra lia Ne th er lan ds Ca na da Sw Un ed ite en d Ki ng do Un m ite d St at es
Sp ain Gr ee ce
Po rtu ga l Fr an ce Au st ria Ire lan d
0
1. ICT equipment is defined as computer and office equipment and communication equipment; software includes both purchased and own account software. Software investment in Japan is likely to be underestimated, owing to methodological differences. 2. 2001 for France, Spain, Italy, Belgium, Germany, Australia, Canada and the United States. 2000 elsewhere. Source: OECD, Science, Technology and Industry Scoreboard 2003.
© OECD 2004
131
OECD Science, Technology and Industry Outlook 2004
Figure 4.19. Software investment in OECD countries, 1980-2000 Percentage of non-residential gross fixed capital formation, total economy (%) 1980
% 20
1990
2000
1995
15
10
5
Ita ly Au st ria Po rtu ga l Ire lan d
Sp ain
Fr an ce
Ca na da Ne th er lan ds Au st ra lia Gr ee ce Ge rm an y Ja pa n Be lg iu m
Sw ed en De nm Un ar k ite d St Un at ite es d Ki ng do m Fin lan d
0
Source: OECD, Science, Technology and Industry Scoreboard 2003.
Figure 4.20. Sources of information used by innovative firms in the service sector, 1998-2000 As a % of total innovative firms Manufacturing
% 100 90 80 70 60 50 40 30 20 10 0 Within enterprise
From other enterprises within group
Internal sources
132
From suppliers
From clients From and customers competitors Market sources
From universities
From government
Institutional sources
Conferences, journals
Fairs, exhibitions
Other sources
Note: Sweden and Iceland are excluded due to limitations on the quality of the data. Source: OECD, based on Eurostat, CIS3 survey 2004.
© OECD 2004
Promoting Innovation in Services
Human capital remains a cornerstone of services innovation Skills upgrading and human capital are pillars of the innovation process, especially in knowledgebased economies. Reliance on human capital is crucial in the services sector. Employment in services is no longer considered low-skilled and low-paid, and the shift in employment towards services cannot be regarded as a move towards less attractive jobs (OECD, 2001a). With the increasing involvement of highly skilled workers, growth in service employment accelerated strongly between the early 1980s and the early 1990s (OECD, 1998). The shift towards more high-skill jobs and the increase in activity have increased the risks of shortages and misallocations. At present, while some of the best-paid and most high-skill jobs are in services, many low-skill jobs remain. The share of employees with higher education, although it varies across countries, is larger in market services than in manufacturing (Figure 4.21). In Finland, more than one employee out of three in the service sector is a university graduate, compared to one out of four in manufacturing. In many countries the share of highly skilled employees in manufacturing is less than half of the share in services. The gap is particularly striking in Portugal, Greece, Sweden and Luxembourg. Wholesale and retail trade and transport and communications are the main employers in the services. Most highly skilled workers, however, are concentrated in financial intermediation and business services (Figure 4.22). The proportion of university graduates in financial intermediation varies considerably across countries: in Greece, Portugal and Belgium, over three-quarters of finance jobs are occupied by highly skilled personnel, but in Denmark, university graduates account for less than 40% of finance employment. In contrast, the share of highly skilled workers is fairly consistent at around 10% in transport and communications, and around 20% in business services. The high concentration of graduates in the Finnish service sector is related to an unusually high concentration of skills in wholesale and retail trade. To some extent this is also the case in Norway, Sweden and Belgium. Lack of suitably trained human resources can be a significant impediment to innovation. In the CIS3 survey, costs associated with innovation risks and funding difficulties were identified as the main impediments to innovation in both manufacturing and services. However, lack of qualified personnel is
Figure 4.21. Share of employees with higher education in the service sector, 2000 As a % of total employment Manufacturing
% 50
40
30
20
10
Note: The dot for Iceland is the share of highly skilled employees in the total business sector instead of manufacturing. Source: OECD based on data from Eurostat, CIS3 survey 2004.
© OECD 2004
ria De nm ar k
st Au
ly Ita
Ic ela nd Ne th er lan ds
Po rtu ga l
Ge rm an y
Sp ain
Sw ed en
Gr ee ce
Be lg iu m
No rw ay Lu xe m bo ur g
Fin lan d
Fr an ce
0
133
OECD Science, Technology and Industry Outlook 2004
Figure 4.22. Concentration of highly skilled employees in the services, by industry, 2000 As a % of all employees in each service sector
% 100
Wholesale and retail trade
Transport and communications
Financial intermediation
Business services
80
60
40
20
De nm ar k
Ic ela nd
st ria Lu xe m bo ur g
Au
ly
Sw ed en
Ita
Fin lan d
Ge rm an y
Ne th er lan ds
No rw ay
Sp ain
Be lg iu m
Po rtu ga l
Gr ee ce
0
Source: OECD based on Eurostat, CIS3 survey 2004.
frequently mentioned as a highly relevant barrier (Figure 4.23). An earlier survey of European service firms also concluded that the lack of highly educated personnel was an obstacle, especially for knowledge-intensive services (Sundbo and Gallouj, 1998). Innovative firms are particularly sensitive to
Figure 4.23. Factors impeding innovation in services and manufacturing Percentage of firms identifying the factor as highly relevant as a share of all firms expressing any relevance (%) Services
% 35
Manufacturing
30 25 20 15 10 5 0 Economic risks
Innovation costs
Lack of financing
Economic factors
134
Organisational Lack rigidities of personnel
Lack of technical information Internal factors
Lack of market information
Regulations, constraints
Lack of response
Other factors
Source: OECD, based on Eurostat, CIS3 survey 2004.
© OECD 2004
Promoting Innovation in Services
a lack of skilled personnel and frequently point this out. Training often comes with the introduction of new product or process. The importance of highly skilled labour for the service sector implies that policies to encourage service-sector innovation will need to emphasise education and training. This need goes beyond the training of human resources for science and technology who play a significant role in R&D (see Chapter 5) to include a much larger segment of the working population. Governments have a significant role to play in providing basic education and in increasing the share of national populations with tertiary education, but co-operation with the private sector may also be necessary to ensure that education programmes remain relevant to industry needs and keep pace with developments in fastmoving fields, such as ICT. Entrepreneurship is a key driver of service innovation The process of firm entry and exit plays a significant role in productivity growth by reallocating resources from units with lower productivity to units with higher productivity (OECD, 2001b; Scarpetta et al.,1992; Foster et al., 1998). Recent studies indicate that in Europe between 12% and 19% of all nonagricultural firms enter or exit the market every year (OECD, 2003). This process of creative destruction facilitates innovation and the adoption of new technology (Brandt, 2004). Existing research demonstrates several additional points: i) entries and exits are highly correlated, illustrating a process of search and experimentation, but entries exceed exits in most countries; ii) new firms typically start small and do not survive very long, but those that do usually grow rapidly over time. Entrepreneurship plays an important role in service-sector innovation. First, firm renewal is generally more intense in services than in manufacturing. In particular, entries are substantially higher in dynamic service sectors, such as business services or ICT-related industries, than in mature industries (OECD, 2003). Second, innovation surveys indicate that new firms account for a larger share of innovative firms in the service sector than in manufacturing (Figure 4.24). In Sweden, for example, one out of every ten innovative service firms was established after 1998, vs. just one out of 20 innovative
Figure 4.24. Share of new firms in the population of innovative firms in manufacturing and services, 1998-2000 Newly established firms as a % of innovative firms Manufacturing
% 20
15
10
5
Source: OECD based on Eurostat, CIS3 survey 2004.
© OECD 2004
Po rtu ga l
ly Be lg iu m
Ita
ria st Au
Fr an ce
Sp ain Ne th er lan ds
De nm ar k Ge rm an y
Fin lan d
Gr ee ce
Sw ed en
Lu xe m bo ur g
No rw ay
Ic ela nd
0
135
OECD Science, Technology and Industry Outlook 2004
Figure 4.25. Innovative density of new and established firms in the service sector, 1998-2000 Innovative firms as a % of all services firms Newly established firms
% 80
60
40
20
Sp ain
ly Ita
No rw ay Gr ee ce
Fr an ce
De nm ar k
Fin lan d Ne th er lan ds
Be lg iu m
ria st Au
Sw ed en
Po rtu ga l Lu xe m bo ur g
Ic ela nd
Ge rm an y
0
Source: OECD based on Eurostat, CIS3 survey 2004.
manufacturing firms. In Denmark, approximately 8% of innovative service firms were new compared to only 1% of innovative manufacturing firms. In countries with lower rates of new firm entry, however, such as Portugal, Italy and Austria, the difference between service and manufacturing sectors is smaller or even reversed. This may highlight the strong role of an innovative service sector in business dynamism and, beyond a threshold of entries, a shift in firm creation towards innovative service activities. Nevertheless, there appear to be limits to the ability of entrepreneurship to improve innovative performance in the service sector. To some extent, the ability of new firms to innovate is conditioned by the general economic environment in which they operate. In more innovative economies, new firms need to be more innovative to compete and to integrate into the supply chains of established, and often larger, firms. In less innovative economies, the incentives for new firms to innovate may be weaker. Results of the CIS3 survey provide some support for this hypothesis: countries with higher overall levels of innovation (i.e. larger shares of firms reporting the introduction of an innovation) tended to have higher levels of innovation among new firms; countries with low innovative density, such as Greece, Italy and Spain, had the lowest innovative density among small firms. In the cases of Greece and Italy, new firms were less innovative than the general population of service firms (Figure 4.25). Interestingly, while the innovative density of new service-sector firms is higher than that of established firms in most countries, the same trend does not hold true in manufacturing. Policies to promote innovation in services
136
To date, the service sector has not been a major target of innovation policy. In a recent survey by the OECD, most OECD countries claimed not to have specific policies focused on innovation in the service sector. Innovation policy measures in most OECD countries are sector-neutral and address firms in both services and manufacturing; countries do not differentiate between services and manufacturing when considering firms for participation in governments support programmes. This trend is part of a continuing shift throughout the OECD area away from specific sectoral policies and towards common innovation frameworks. Another reason for the limited policy attention to the service sector may be, as © OECD 2004
Promoting Innovation in Services
claimed by the Netherlands, the difficulty for policy makers to see clear reasons for, or any clear form of, policies for service sectors. Despite the sector-neutral approach to innovation policy, service-sector firms do not participate to a large extent in existing innovation programmes. In the OECD survey, few countries reported significant participation by service-sector firms; in most, such statistics are not available. The CIS3 survey provides some evidence of the weak participation of service-sector firms in government programmes. In the survey, the share of innovative firms indicating that they had received public funding was considerably lower in the service sector than in manufacturing (Figure 4.26). In Finland, Italy, Austria and the Netherlands, for example, between 45% and 50% of manufacturing firms reportedly received government financial support, compared to 20% to 30% of service-sector firms. In no country does the share of service-sector firms receiving support exceed that of manufacturing firms. Although public funding as reported in the CIS survey may not represent only financing from government innovation programmes, the data suggest that service-sector firms participate less actively than manufacturing firms in public programmes. A few countries are nevertheless developing innovation policies that focus on innovation in services. In Finland, for example, new strategic guidelines for innovation policy prepared by the Ministry of Trade and Industry recognise the growing policy importance of services and emphasise the need to support the balanced development of innovation in all sectors. In Ireland, appropriate ways to encourage innovation in the internationally traded service sector is the subject of ongoing work within government. In Norway, two of the projects in the government’s Innovation 2010 initiative seek to identify obstacles to innovation in services. Outside the OECD area, countries are also beginning to highlight service-sector innovation in policy making. In 2002, the Chinese State Council circulated a document entitled “Comments on Policies and Measures to Accelerate Development of Service Industry during the 10th Five-Year Period” to raise the nation’s service industry to a new level. China will also study the necessity and feasibility of tax policies to encourage innovative activities in services. The Russian government considers measures to stimulate innovation in the service sector under its general framework for innovation infrastructure development.
Figure 4.26. Public funding of manufacturing and service firms, 1998-2000 As a % of total innovative firms Manufacturing
Services
Finland Italy Austria Greece Netherlands Sweden Spain Norway France Portugal Belgium Germany Luxembourg
n.a.
Denmark 60
Source: Eurostat, CIS3 survey 2004.
© OECD 2004
40
20
0
20
40
60 %
137
OECD Science, Technology and Industry Outlook 2004
Beyond these general shifts in focus, some countries have begun to implement policies to encourage innovation in specific service industries; most concentrate on development and use of information technology (IT). Some focus on the establishment and maintenance of an IT-related business environment, such as developing standards for e-commerce and encouraging public procurement via e-commerce. There is strong support for boosting software industries in some countries. Policy measures for human resource development in the service sector are also aimed at IT-related sub-sectors, such as educational support to IT-related human resources and training in IT-related skills. Some countries focus on encouraging clustering and networking because knowledge acquisition is major source of innovation in service sectors. Although R&D is not generally a major driver of services innovation, IT-related sectors which can be seen as more R&D-intensive have attracted government support to encourage R&D. Supporting SMEs and encouraging entrepreneurship are also targets of government policy measures, most of which focus on IT industries. Developing an IT-related business environment ICT-related service businesses have received strong support in many countries. For example, Denmark focuses on e-trade and business applications of digital technologies to improve the framework for efficient use of IT in businesses, thus making use of IT by business and industry a lever for increasing innovation, efficiency and productivity. Denmark’s strategic goals for IT in the business sector are digital business and industry, its IT industry and the telecommunications market. Denmark also launched an “Action Plan for e-commerce 2002” which aims to increase user confidence in ecommerce, encourage public institutions to adopt e-commerce-based procurement processes, and motivate private enterprises to integrate e-commerce into their business procedures. Switzerland has developed standards for online commerce with its Softnet programme. It has also prepared new legislation concerning electronic signatures, domain names and copyright for online services to guarantee greater legal security on online services. The Norwegian government has taken initiatives related to the establishment of electronic marketplaces and the fostering of more public key infrastructure solutions, both of which are important for the provision of services. Also, work has been initiated with the aim of securing more transparent regulation of the transfer of public data (maps, meteorological data, etc.) for private-sector commercial use, in line with EU regulations in the ICT area. Supporting software industries Establishing a high-quality software industry is seen as a way to improve the competitiveness not only of the software industry but also of the general economy. In this context, some countries focus on innovation in software industries. For example, Japan has established several policy measures to support individuals and private enterprises aiming to develop high-quality software. A pilot project to promote the development and use of open source software will also be established in Japan. Iceland’s most important programmes for addressing service-sector innovation have been the information and environmental technology programmes. Software companies are the main privatesector beneficiaries of these programmes. As part of its Softnet programme, Switzerland also allocated CHF 30 million to build up a software industry of international standards through co-operation between public research organisations and industry, and fostering networks of competence and training of ICT professionals. Although open source software is already used to some extent in the public administration, evaluation of the advantages and risks of free and open source software for public purposes is ongoing. Developing human resources
138
Human resource development has been a major concern in many countries because a skilled professional IT labour force is essential for more efficient use of IT in business. Countries have taken a number of steps to improve training and education. For example, the Danish Ministry of Science, Technology and Innovation has implemented measures to make it possible for IT staff with a short-cycle © OECD 2004
Promoting Innovation in Services
higher education (such as multimedia designers) to receive credit towards a university education. The Danish government has also allocated DKK 115 million to finance IT research during 2003-05, a major portion of which is set aside for increasing the number of PhDs. The Swiss government is creating new degree programmes (and a new type of diploma) for professional training in information technologies. Japan offers several examples of policy measures to support ICT training. For example, it evaluates the validity of practical training with respect to the IT Skill Standards and Training Roadmap. The government will also establish standard specifications for both hardware and software to support effective training and education using IT products at primary and secondary level education. Clustering and networking Since suppliers and customers are significant resources for service innovation, clustering and networking can help widen and increase the efficiency of knowledge acquisition for innovation. Several countries encourage clustering and networking to enhance innovation across their economies, but some have implemented specific policy measures for ICT fields. For example, there are over 40 cluster development initiatives currently in progress in New Zealand with total grants of up to NZD 50 000. Some of the clusters focus on the service sectors, including software industries. Ireland’s policy document, “Opportunities for Ireland’s High-technology Internationally Traded Services Sector to 2007” (ITS 2007), has as a key element of its strategy the development of a series of regional infrastructure initiatives or technology hubs known as Web-works to facilitate networking among companies and encourage mutual learning and information sharing (Martin, 2001). Some Webworks may evolve in response to existing local clusters of knowledge-intensive companies, while others may develop strong links with third-level colleges to facilitate the spin-off of high-technology campus companies. Each Web-works will concentrate on one technology, broadly defined, and will house companies in one of the four target sectors: informatics, e-business, digital media and health sciences. Policy measures to strengthen science and industry linkages are observed in some countries’ policy practices. For example, New Zealand has a specific policy to foster innovation across the service sector by strengthening linkages with government research laboratories and universities. Another aspect of the Danish government’s funding of IT research is the expectation that it will improve interaction between research institutions and the business sector in the field of IT research. In the Czech Republic, universities and public research institutes offer several services to the innovation activities of private firms. For example, the Centre for Innovation and Technology Transfer of Palacky University offers contact with its scientific experts; R&D space for enterprises; and consultation for start-ups. Investing in R&D Since service innovation relies less on R&D than manufacturing innovation, government R&D support programmes have not been widely used to stimulate service-sector innovation in OECD countries. However, policy measures in some countries have targeted R&D-intensive service sectors. The software industry, in particular, is a major target of support. Japan provides special financial support to SMEs for software-related R&D and also funds IT experts to develop original software. Projects to develop next-generation software technology can also receive government subsidies. Fostering service SMEs and encouraging start-ups in services Promoting innovation in SMEs is a focus of innovation policy measures, and some countries set their sights on knowledge-intensive service sectors, especially ICT industries. For example, the Danish action plan for e-commerce (mentioned above) took a consultancy and training initiative for ecommerce to 60 SMEs. SMEs are also major targets of the Danish E-learning Initiative. Larger enterprises appear already to be on the way to capitalising on their investments in e-leaning for vocational training, but SMEs are less advanced. Therefore, the initiative focuses on how SMEs may gain in competitiveness and develop competencies through the use of e-learning. Japan also supports ITrelated SMEs by providing financial support for R&D. © OECD 2004
139
OECD Science, Technology and Industry Outlook 2004
In terms of encouraging entrepreneurship, Ireland can provide useful experience for encouraging the service sector’s participation in government policy programmes. Although all R&D programmes of Enterprise Ireland are aimed both at manufacturing and services, the government has a unit dedicated to encouraging start-ups in the service sector. The unit provides assistance with business planning, feasibility studies, and access to other Enterprise Ireland services such as technical expertise and its overseas office network. Conclusion This overview indicates the growing importance of the service sector in OECD economies. Productivity and employment growth are highly dependent on the success of service industries, and services are strong drivers of recent economic growth in most OECD economies. In spite of the traditional view of service sectors as less dynamic, poorly paid and not innovative, statistical evidence supports the notion that services are increasingly knowledge-based, innovative and drivers of growth. Although service-sector firms are generally less likely to be innovative than manufacturing firms, they are becoming increasingly innovative and knowledge-intensive, and services such as financial intermediation and business services show above-average levels of innovation. Enhancing innovation in the service sector will require attention to a number of policy areas, with different emphases than for manufacturing. Service-sector innovation derives less from investments in formal R&D and draws more extensively on acquisition of knowledge from outside sources. Development of human resources is especially important to service firms, given their high reliance on highly skilled and highly educated workers, as well as indications that a lack of highly skilled personnel is a major impediment to service innovation in most OECD economies. The role of newly established firms in innovative activity is greater in services than in manufacturing, so that entrepreneurship is also a key driver of service innovation. Nonetheless, small firms tend to be less innovative than larger firms. Although the growing importance of services for economic growth and the significant role of innovation in vitalising the service sector have been clearly recognised by OECD economies, policy measures for promoting service-sector innovation are lacking. Countries do not have innovation policies that are targeted at services, and participation of service-sector firms in sector-neutral programmes is low. The few policies targeting service innovation aim primarily at IT development and use. Clearly, greater attention is needed to raising awareness of public policies and programmes among servicesector firms, but it will also be important to design programmes to be more relevant and useful to the service sector. Since the characteristics of service-sector innovation vary among individual service industries, policy makers will be challenged to establish effective sector-wide policy measures for promoting innovation. However, some findings discussed in this chapter may suggest policy directions, such as those related to external knowledge acquisition, clustering and networking, human resource development and entrepreneurship. Although empirical policy experience is limited, more attention to service-sector innovation may yield large dividends.
140
© OECD 2004
Promoting Innovation in Services
NOTES 1. Throughout this chapter, the term “market services” refers to the following service sector industries: wholesale and retail trade (ISIC 50-55); transport and communication (ISIC 60-64); and finance, insurance, real estate and business services (ISIC 65-74). The term “business services” refers to the renting of machinery and equipment, computer and related activities, R&D, and other business services (ISIC 71-74). “ICT services” include post and communications (ISIC 64) and computer and related activities (ISIC 72). Total services (ISIC 55-99) includes all market services plus community social and personal services (ISIC 75-99). 2. As used in this report, innovative firms are a sub-population of firms that have generated and/or implemented new products/processes. Innovative density refers to the share of innovative firms in the total population of firms. 3. Similar results have been found in other studies as well. See, for example, DTI (2003). 4. Differences in the way countries report services R&D data limit the degree of comparability across countries.
141
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
REFERENCES Barras, R. (1986), “Towards a theory of innovation in services”, Research Policy, Vol. 15, August, pp. 161-173. Brandt, N. (2004), “Business Dynamics, Regulation and Performance”, OECD/STI Working Paper, March. De Jong, J.P.J., A. Bruins, W. Dolfsma and J. Meijaard (2003), “Innovation in Service Firms Explored: What, How and Why?”, Strategic Study B200205, Zoetermeer, January. De Laat B., M. Callon and P. Laredo (1997), “Innovation in Services as an Epitome of Complexity: How Network Analysis Can Disentangle It”, paper presented to the 7th International Forum on technology management, Kyoto, 3-7 November. DTI (2003), “Competing in the Global Economy – The Innovation Challenge”, DTI Economics Paper No. 7, Department of Trade and Industry, the United Kingdom. European Commission (2003), “European Innovation Scoreboard: Technical paper n 5, National innovation System Indicators”, European Commission, Enterprise Directorate-General, Brussels, 2003. European Commission (2004), “Innovation in Services: Issues at Stake and Trends”, study co-ordinated by Jeremy Howells and Bruce Tether under Contract No. INNO-03-01, Brussels. Kuusisto, J. and M. Meyer (2003), “Insights into Services and Innovation in the Knowledge Intensive Economy”, Technology Review 134/2003, Helsinki. Martin, T. (2001), “Innovation in Services and the Knowledge Economy the Interface between Policy Makers and Enterprises: A Business Perspective”, Innovation and Productivity in Services, OECD, Paris, pp. 119-133. OECD (1996), OECD Science, Technology and Industry Outlook, Paris. OECD (2000), OECD Science, Technology and Industry Outlook, Paris. OECD (2001a), Innovation and Productivity in Services, Paris. OECD (2001b), Science, Technology and Industry Outlook 2001 – Drivers of Growth: ICT, Innovation and Entrepreneurship, Paris. OECD (2003), OECD Science, Technology and Industry Scoreboard, Paris. Sundbo, J. and F. Gallouj (1998), Innovation in Services – SIS4 Project Synthesis, STEP Group, Norway.
142
© OECD 2004
Chapter 5
ENSURING THE SUPPLY OF HUMAN RESOURCES IN SCIENCE AND TECHNOLOGY
This chapter discusses the evolving policy context for HRST and analyses recent trends in the demand for and supply of graduates in science and engineering. It reviews policy measures implemented by OECD governments to address the challenges raised by these trends and discusses the outlook for human resources in science and technology. As the chapter shows, concerns about supplies of HRST are widespread across the OECD area, though often for different reasons. Countries are taking a number of innovative steps to increase interest in science and technology studies, to make scientific and engineering careers more attractive, and to benefit from international mobility of science and technology workers.
143
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction Human resources are at the core of the scientific research enterprise as well as social and technological innovation. Men and women trained in science and technology help firms to innovate and make it possible for universities and public research institutions to carry out their education and research missions. Governments and higher education institutions therefore have several objectives with regard to the development of human resources in science and technology (HRST). They must ensure a sufficient supply of scientists and researchers to work in industry and in the public sector. They must also ensure that education and training curricula are relevant and able to adapt to the emergence of new scientific disciplines and industries (e.g. nanotechnology). In addition, because transfers of knowledge and technology take place mainly through people, governments must ensure that regulatory frameworks and markets foster the mobility of researchers between the public and private research sectors as well as within and between geographic regions. Recent developments have raised concerns about the future supply of HRST and the ability to meet anticipated demand. Demand for science and engineering graduates is growing as OECD countries move to more knowledge-based economies and as an accelerating number of researchers approach retirement age, notably in the public research sector. While numbers of science and engineering graduates continue to grow, their share among all graduates has expanded slowly or declined in a number of countries, and enrolments have dropped at the first levels of tertiary education. Access to foreign students and researchers has become an important way to meet demand and stimulate the diffusion of knowledge in many OECD countries, but the international mobility of students and scientists raises its own challenges. This chapter discusses the evolving policy context for HRST and analyses recent trends in the demand for and supply of graduates in science and engineering. 1 It then reviews policy measures implemented by OECD governments to address the challenges raised by these trends and discusses the outlook for human resources in science and technology. As the chapter shows, concerns about supplies of HRST are widespread across the OECD area, though often for different reasons. Countries are taking a number of innovative steps to increase interest in science and technology studies, to make scientific and engineering careers more attractive, and to benefit from international mobility of science and technology workers. Growing demand for science and technology workers As business and governments investments more in research and development (R&D), demand for public and business researchers in areas such as information technology (IT) and biotechnology continues to expand. According to occupational data or labour force data, people educated in science and technology and/or working in occupations that typically require such qualifications represent some 20% to 35% of the labour force in OECD countries. Employment in these occupations has grown much more quickly than for the labour force as a whole in almost all OECD countries. Growth rates exceeded 3% a year between 1995 and 2000 in roughly half of OECD countries for which data are available, compared to roughly 1.5% for all employment.
144
1. In this chapter OECD data on science and engineering graduates and enrolments refer to the following fields of study according to the 1997 International Standard Classification of Education (ISCED): a) science includes life sciences (42), physical sciences (44), mathematics and statistics (46), and computing (48); b) engineering includes: engineering and engineering trades (52), manufacturing and processing (54) and architecture and building (58).
© OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Of particular interest in debates about HRST are researchers – professionals engaged in the conception and creation of new knowledge, products, processes, methods and systems and directly involved in the management of projects. Growth in the researcher population has been rapid over the past decade. Between 1992 and 2000, the number of researchers in OECD countries rose from 2.5 million to 3.4 million, a 37% increase, or 3.6% a year. On average, researchers accounted for 6.5 of every 1 000 employees in the OECD workforce in 2000, up from 5.7 in 1992 (Figure 5.1). In Finland, the number of researchers per thousand employees more than doubled, from approximately 6.7 in 1991 to 16.4 in 2002, driven by the expansion of its high-technology sectors. The business sector accounts for most of the research workforce and most of its growth. About twothirds of all researchers in OECD countries are employed by the business sector, but the share varies considerably across the main regions and countries: in the United States, business absorbs four out of five researchers; in Japan and Korea between two-thirds and three-quarters of all researchers work in the business sector. In the European Union and Australia, however, fewer than half of all researchers work in the business sector, reflecting a lower level of business investment in R&D and, consequently, more limited job opportunities for scientists and engineers. Growing business demand for researchers accounted for more than 60% of the total growth in the research population in the last decade.
Figure 5.1. Researchers per thousand in total employment, 2002 Total researchers
10.3
Finland Sweden (2001) Japan Norway (2001) United States (1999) Belgium (2001) Australia (2000) France (2001) Canada (2000) Denmark (2001) New Zealand (2001) Germany Total OECD (2000) Korea Switzerland (2000) Luxembourg (2000) EU15 (2001) EU25 (2001) United Kingdom (1998) Netherlands (2001) Spain Ireland (2000) Austria (1998) Slovak Republic Poland Hungary Greece (1999) Portugal (2001) Czech Republic Italy (2001) Turkey (2000) Mexico (1999)
5.7 0.8 3.8 3.6 5.5 3.0 2.5 5.0 4.6 5.9 1.9 4.0 4.9 4.7 3.1 3.3 3.3 4.3 6.9 5.4 7.6 Average annual growth of total researcher population, 1992-2002 or nearest years available -1.4 2.2 2.0 10.1 7.0 1.0 0.4 7.6 7.3 0
Source: OECD MSTI Database, 2004.
© OECD 2004
of which: Business enterprise researchers
2
4
6
8
10
12
14
16
18
145
OECD Science, Technology and Industry Outlook 2004
Between 1992 and 2000, the number of business researchers grew by 39%, from 1.6 million to 2.2 million. Growth was strongest in the United States, which saw average annual increases of 3.3%, compared to 2.8% in the EU15 and 1.9% in Japan. Business sector demand for researchers is changing, as competition, globalisation and shorter product life cycles alter the focus of business R&D labs. Firms are increasingly adopting a more networked, open model of innovation that relies on partnerships and alliances as well as the acquisition of needed technology from a variety of sources, including public research institutions and new technology-based firms. Innovation in the service sector (e.g. banking, financial and business services) has also increased demand for graduates with science and technology backgrounds, creating a broader palette of opportunities for science and technology graduates outside their traditional employers, such as academia and manufacturing firms. Globalisation of R&D is altering patterns of demand for researchers, whether or not it results in the actual movement of research jobs to foreign countries (Box 5.1). Such changes are exerting pressure on higher education systems to produce science and
Box 5.1. Globalisation of R&D and outsourcing of science and technology employment The international outsourcing of highly skilled jobs is an issue that has moved to centre stage in many OECD countries. Governments, however, lack official data on the phenomenon. According to Forrester Research, US firms increased the number of software programming jobs created overseas from 27 000 in 2000 to 80 000 in 2003. Forrester Research estimates that by 2015, some 3.3 million service industry jobs, including IT-related jobs, will have been outsourced from the United States to other countries, mainly India, China and Southeast Asia. While this represents the potential loss of 250 000 highskilled jobs a year, the number is small compared to total US employment of 137 million (Brainard and Litan, 2004). Although policy attention focuses on the outsourcing of IT-related jobs, there are growing concerns that R&D-related jobs will also be outsourced as OECD-based firms continue to expand their foreign R&D operations. Traditionally, it has been assumed that the R&D activities of firms were of such strategic value that outsourcing them for cost reasons was too risky, notably in comparison to the outsourcing of manufacturing or back-office activities (e.g. call centres). Now, heightened competition, the development of global research networks, availability of highly skilled staff overseas and access to new markets as well as greater protection of intellectual property rights overseas are all making the globalisation of R&D activities not only less risky but a necessary part of firms’ strategies. OECD data show that, on average, R&D performed abroad by foreign affiliates represents 12% of total expenditure on industrial R&D in the OECD area. Outflows of R&D to developing countries are on the rise, especially to China and India. US foreign affiliates in China performed USD 506 million worth of R&D compared to only USD 7 million in 1994 (OECD, Activities of Foreign Affiliates database). The number of jobs involved in such affiliates is difficult to estimate. Motorola’s China R&D Institute, for example, links 19 separate R&D centres, employing some 1 600 R&D engineers. IBM’s China Research Laboratory has over 100 technical staff as does Intel’s China Software Lab in Shanghai. Bell Labs Research China employs just 23 staff members. The United States is not the only OECD country concerned by the outsourcing of R&D and related jobs. The UK and continental European countries such as Germany also report a rise in outsourcing activities to neighbouring countries in Central and Eastern Europe, Russia and China. Meanwhile, Japanese and Korean firms continue to expand their research and business activities in China and Southeast Asia, even if North America remains a key destination for R&D-related FDI. Economic theory suggests that outsourcing offers net economic gains as firms raise their productivity and invest the cost savings into R&D which leads to the development of new products and services and creates more high-skilled jobs, raising income levels. Yet it also warns that there may be dislocation effects as unsuccessful firms and their workers are displaced. The policy challenge in many countries is to ensure a level playing field in global trade in services while addressing the short-term costs through adjustment measures such as retraining benefits for displaced workers. Improving the attractiveness of a country for cutting-edge research and innovation, including by encouraging skilled workers to invest in lifelong learning and by fostering entrepreneurship, will, however, go a long way towards helping countries benefit from the globalisation of R&D and outsourcing. 146
© OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
engineering graduates with interdisciplinary skills as well as with a range of teamwork, managerial and entrepreneurial skills. Although business accounts for most of the demand for researchers, public-sector demand has also grown quickly, largely owing to the higher education sector. OECD-wide, the number of public-sector researchers increased by more than 20% between 1991 and 2000. In the United States, the number of researchers in the higher education sector grew by 35% between 1991 and 1999, while the number of government researchers dropped by 18%. The European Union saw the higher education research population rise by 30% overall during the 1990s, while the government sector expanded by 8%. In Japan the number of higher education researchers also grew by approximately 20% during the decade, while the number of government researchers remained relatively flat. Thus, while business is driving new demand for researchers, parallel investments in higher education R&D by governments, business and even private foundations are stimulating demand for researchers in universities. The characteristics of public sector research employment, too, are changing. Although employment has continued to expand in a large number of OECD countries, in countries such as Japan, Italy, the United Kingdom and the United States much of this growth has been due to the rise of temporary employment positions, including post-doctorates. The shift in public research funding towards a more complex funding system involving competitive and project-based funding as well as funding from business exerts more pressure on public research institutions to be more flexible and able to respond to changes in research funding and priorities and thus affects employment arrangements. Demand for researchers and science and technology workers more broadly is expected to grow – the EU estimates it will need 700 000 new researchers to meet its commitment to increase investment in R&D to 3% of GDP by 2010. Other OECD countries that have established R&D spending targets are equally concerned about shortfalls in the supply of graduates (Table 5.1). Demand for science
Table 5.1. National goals for human resources in science and technology Country/region
Human resource goals
European Union
An estimated 700 000 additional researchers will required to meet the objective of raising R&D spending to 3% of GDP by 2010. Increase the number of researchers in the business sector. In 2004, an additional 300 CIFRE (Conventions Industrielles de Formation par la Recherche] scholarships for PhD training in an industrial setting will be funded. Increase the share of German students having studied abroad from 14% to 20%, and increase the share of foreign students from 8.5% to 10% by 2010. Double the proportion of researchers in the population from 5:1 000 to 10:1 000. An estimated 100 000 additional researchers will required to achieve the objective of raising R&D intensity to the top five in the OECD. The government aims to increase Master’s and PhD students at Canadian universities by an average 5% a year to 2010. Up to 4 000 new qualified graduate students will funded through the Canada Graduate Scholarships Programme. In 2003, new funding was allocated to improve the Student Loan Programme. Policy recommendation by the University Council in 1997 stated that graduate enrolment should be expanded from 150 000 in 1997 to 250 000 in 2010 to meet new demand. Increase the number of researchers from 180 000 to 250 000. The Ministries of Education, Culture and Science, of Economic Affairs and of Social Welfare and Employment have established the “Delta Plan for Science and Technology” among other actions to increase the number of knowledge workers with a scientific or engineering background. The plan includes initiatives in the areas of science education, communication about science and technology, women and minorities in science and the immigration of knowledge workers. Annual investments will increase to EUR 60 million by 2007 to carry out the policy measures. Increase PhD degrees awarded from 700 to 1 100 degrees a year (total for all disciplines) by 2010. Double the number of assistant female professors at Swiss universities by 2006 to 14% of faculty. Fill all primary and secondary schools with teachers who are trained in mathematics and science by 2005 (as stipulated by the “No Child Left Behind” Law).
France
Germany Ireland Canada
Japan Korea Netherlands
Norway Switzerland United States
Source: OECD STI Outlook 2004 Questionnaire; European Commission (2003) DG-Research Communication on the 3% Target.
© OECD 2004
147
OECD Science, Technology and Industry Outlook 2004
graduates in Japan, in particular, is expected to increase as the government plans to boost funding for basic research. Japan’s University Council predicted in 1998 that demand for Master’s students would exceed supply by 2010 (Yamamoto, 2003). Ireland, whose stock of skilled labour has been key to attracting R&D-related foreign direct investment (FDI), is predicting shortages of engineering, biomedical and chemical graduates as early as 2005 (Forfás, 2003). The US National Science Foundation (NSF) projects that some 2.2 million new jobs in science and engineering will be created over 2000-10, especially in computer-related occupations, and that employment in science and engineering will increase three times faster than the overall rate of employment. Furthermore, the US National Academies estimate that the number of people working in the biotechnology industry will rise from around 200 000 to over 1 million by 2015 (NAS, 2001). Demand will be augmented by demographic changes, in particular the ageing of the science and engineering workforce. Countries such as Australia and Italy worry about replacing the large numbers of “baby boomer” faculty that will retire in the coming years. Some 70% of full professors and 35% of all science staff at Italian universities are over 50 years old. A recent Dutch study found that by 2008, holding 1998 demand constant and based on retirement rates and current enrolment trends, some 12% of research positions in universities and public research organisations would go unfilled because of shortages (Van Dijk and Webbink, 2000). Will supply meet demand? Meeting the demand for scientific talent is high on the agenda of all OECD governments, and concerns about falling enrolments and waning interest in science among young people dominate the discussion in many countries. In the United Kingdom, a recent government report bemoaned a 16% drop in enrolments in chemistry and a 7% drop in enrolments in physics and engineering between 1995 and 2000 (HM Treasury, 2002). The US National Science Board recently sounded the alarm over US dependence on foreign graduate students and falling enrolments in science and engineering among US-born students (National Science Board, 2004a). Such concerns are not new. Already in 1945, Vannevar Bush, the Director of the US Office of Scientific Research and Development, warned that “with mounting demands for scientists both for teaching and for research, [America] will enter the post-war period with a serious deficit in our trained scientific personnel”. The launching of Sputnik in 1957 and the space race between the Soviet Union and the United States amplified these concerns and led to the expansion in the supply of scientists and engineers, not only in these two countries but also in Western Europe and Japan. Concerns about shortages of scientists and engineers resurfaced many times in the ensuing decades. There are several interpretations of the term “shortage”. The first, in standard economic theory, is defined as occurring when demand for labour exceeds the supply of labour available at a given wage. The second type of shortage could be defined as a shrinking of national supply, that is that the number of new science and technology graduates falls and is insufficient to replace those exiting the workforce (e.g. as a result of retirement, emigration or death). Another type of shortage could be defined as resulting from lower than expected production to meet an expected or desired level of demand (Butz et al., 2003). However, most labour economists debunk claims of future shortages of scientists, pointing out that the market will resolve them, as an increase in demand will result in a rise in wages for fewer scientists and this, in turn, will increase incentives for more students to pursue scientific subjects and so raise supply again. This logic may apply less to academic positions, where public universities or governments are the main employers and where public R&D spending is the main determinant of demand. Here, salaries may not adjust easily to a drop in supply or to competition from other sectors such as IT.
148
Shortages should lead to a drop in the unemployment rate for scientists. Unemployment rates for recent university graduates have historically been low across OECD countries and ranged between 2% and 5% in 2000. In the United States, the unemployment rate of PhDs in science and engineering during the recent economic boom was even lower, at 1.2% for graduates who had been out of school for three years, according to the US National Science Foundation. But these overall figures do not show where particular types of scientist are working. In fact, the NSF found that some 4.2% of science and © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
engineering PhDs were working outside their field of training, chiefly for financial reasons, a change in professional interests or lack of opportunities in their field. In other words, while few scientists are out of work, a proportion do not find jobs in occupations that are closely related to their studies. This would weaken the claim of a widespread shortage of science and engineering graduates, but may signal another problem: mismatches between supply and demand. Perhaps the central issue behind concerns about shortages of scientists in OECD countries is the realisation that the growth of OECD economies depends on investments in knowledge, including an ample supply of scientists and engineers, allied with a perception that young people are either less interested in science than before and/or less academically equipped to pursue research careers. Data on graduates and enrolments are one way to assess whether young people are less interested in science than before and whether there is a risk of shortages of graduates on the horizon. Production of science and engineering graduates is expanding, but slowly Over the past two decades the massive expansion of post-secondary education across OECD has led to large numbers of young people with degrees from tertiary education institutions. Public and private expenditures on tertiary education account for 5.9% of GDP in the OECD area and have been rising, but vary widely among countries, from 7% of GDP in the United States and 7.1% in Korea compared to 6.4% of GDP in Sweden and 4.6% of GDP in Japan in 2000/2001 (OECD, 2003b). Meanwhile, higher education has also become more internationalised, with institutions actively recruiting foreign students, establishing campuses overseas and creating joint degree programmes with foreign universities. Private and nontraditional educational institutions have also increased their role as purveyors of higher education, especially in areas like information technologies, language and business skills. The share of tertiary graduates with degrees in science and engineering fields have declined marginally in recent years. In 2001, more than one-fifth of tertiary graduates in OECD countries were granted in science and engineering fields, but the proportion varies widely. In Japan, for example, 25.8% of all university degrees were granted in science and engineering in 2001; the figure for the EU25 is slightly lower, at about 23.6% (Figure 5.2). In the United States, by comparison, only 16.2% of university degrees were in science and engineering. These figures represent slight drops relative to 1998 even if the actual numbers of science graduates has increased. In 1998, the shares of science and engineering graduates were 26.0% in Japan, 24.7% in the EU25, and 16.2% in the United States. Across the OECD, the share declined from 22% to 21.8%. Nevertheless, the total numbers of science and engineering graduates (at all levels of university education) increased between 1998 and 2001, at an average annual rate of 3.2% in the EU, 2.3% in Canada, 1.8% in Japan, and 1.5% in the United States. However, significant differences exist between science graduates and engineering graduates. The number of science graduates expanded significantly in the United States, the United Kingdom and in France, while remaining relatively flat in Japan and Canada and falling in Germany and Italy (Figure 5.3a). The number of engineering graduates, in contrast, fell slightly in France, Germany, United Kingdom and United States, but grew in Italy, Japan and, to a lesser extent, Canada (Figure 5.3b). It is worth recalling that the distribution of science and engineering graduates is heavily influenced by a country’s pattern of economic development and technological specialisation. Countries such as Korea, Japan, Germany and Sweden produce a very large number of engineering graduates in comparison to science graduates. Southern European countries, with the exception of France, also produce more engineering graduates than science graduates. The United States has a more balanced production of engineering and science graduates, reflecting its highly diversified technological base and its strong science base. The supply of PhD graduates is of particular interest insofar as most university teaching and research faculty positions – as well as a significant number of research jobs in science-based industries – require PhD level training. Within the OECD area, EU countries produce more PhDs as a share of the population (186 per million) than the United States (159 per million) and Japan (96 per million). In terms of the absolute number of PhDs in science and engineering, the EU (30 189) outranks the United States (16 287). Within the EU, Sweden, Germany, France, United Kingdom and Finland produced more science and engineering PhDs as a share of total university graduates in 2000 than other EU countries (Figure 5.4). © OECD 2004
149
OECD Science, Technology and Industry Outlook 2004
Figure 5.2. Science and engineering degrees as percentage of new degrees, 2001 Science
Engineering 29.5
Korea Germany Luxembourg3 Sweden France Switzerland United Kingdom Finland Austria Ireland Slovak Republic Japan Czech Republic Spain Italy Mexico Belgium EU1 OECD2 Turkey Canada3 New Zealand Australia Iceland United States Netherlands Denmark Norway Poland Hungary
25.7 33.7 36.4 18.0 35.0 26.1 24.3 41.8 32.4 12.8 26.5 35.6 36.6 32.6 28.5 33.4 30.7 34.9 36.1 41.0 33.2 38.5 34.9 17.5
Percentage of S&E degrees awarded to women
30.2 24.7 35.5 28.7 0
5
10
15
20
25
30
35
40
45 %
1. 15 European countries before the 1st May 2004 to the exception of Luxembourg, Greece and Portugal, and four new members (Czech Republic, Hungary, Poland and Slovak Republic). 2. Average of the available countries. 3. 2000 instead of 2001. Source: OECD, Education database, July 2004.
Trends in PhD production vary considerably across OECD countries. Between 1998 and 2001, the number of science and engineering PhDs rose in Germany, Japan, Korea, but was stable in Austria, Australia and Canada. The number of doctorates in the physical sciences fell in Germany but increased in the United Kingdom and France, while the number of PhDs in the life sciences rose in Germany and the United Kingdom but fell in France. In the United States, there has been a slight rise in the number of science and engineering PhD graduates (4% in 2001), but a breakdown by academic field reveals significant variation. The number of PhDs in the physical sciences stagnated or fell during the 1990s, while it increased substantially in the natural and biological sciences, as well as in engineering. The current increase in public funding for R&D in the United States, especially in the higher education sector, could further accelerate the rise in the overall number of science and engineering PhDs graduates observed in 2001.
150
Data on university enrolments show similar patterns. In 2002 the share of students enrolled in university science and engineering programmes ranged from 20% to 30% on average (Figure 5.5a). Between 1998 and 2002, the majority of OECD countries for which harmonised data are available © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Figure 5.3. Number of science and engineering graduates in G7 countries, 1998-2001 5.3a. Number of science graduates, 1998-2001 5.3b. Number of engineering graduates, 1998-2001 United States Japan
United Kingdom Italy
France Canada
180 000
180 000 Science
Engineering
160 000
160 000
140 000
140 000
120 000
120 000
100 000
100 000
80 000
80 000
60 000
60 000
40 000
40 000
20 000
20 000
0
Germany
1998
1999
2000
0
2001
1998
1999
2000
2001
Note: Data concern science and engineering graduates at all postsecondary education levels (i.e. ISCED levels 5 and 6). Source: OECD Education database, July 2004.
Figure 5.4. Graduate rates at PhD levels, 2001 PhD-level graduates as a share of the population at the typical age of graduation PhDs in science and engineering
All PhDs
39.2
Sweden Switzerland Germany Finland United Kingdom Austria France United States Australia Netherlands Norway Denmark Belgium Portugal (2000) Ireland Spain New Zealand Canada (2000) Korea Czech Republic Slovak Republic Japan Hungary Italy Turkey
34.5 35.0 48.3 39.5 37.1 42.7 44.9 41.2 31.5 34.4 42.3 31.9
42.9 40.7
39.8 22.8 50.8 38.4 0
Source: OECD Education database, 2004.
© OECD 2004
Percentage of PhDs awarded to women
23.7 34.7
0.5
1.0
1.5
2.0
2.5
3.0
3.5 %
151
OECD Science, Technology and Industry Outlook 2004
Figure 5.5. Tertiary enrolment in science and engineering fields 5.5a. Enrolment in science an engineering as a % of total enrolment, 2002 Science
Engineering 22.0
Korea Finland Czech Republic Greece Mexico United Kingdom Ireland Spain Slovak Republic Sweden Portugal Austria Israel Switzerland Turkey Belgium Italy Australia Japan New Zealand Poland Denmark Iceland Hungary Norway Canada Netherlands
26.0 25.2 36.2 30.6 31.8 36.8 33.0 30.6 34.8 33.3 26.9 31.9 21.7 30.4 28.6 33.5 30.6 12.7 39.7 28.7 32.0 34.9 24.4 29.8 34.0
Women enrolled in S&E studies, as a % of total enrolment
15.9 0
10
20
30
40
50 %
Source: OECD Education database, 2004.
showed faster growth in science and technology enrolments than in overall enrolments (Figure 5.5b). This was not the case in Japan, Italy or many eastern European countries (Czech Republic, Hungary, Poland, Slovak Republic) that are in the midst of shifting to more R&D-intensive market economies. These data suggest that future supplies of scientists and engineers may increase, but great caution must be used in inferring graduation rates from enrolment data (Box 5.2). Differences persist by field and level of study National data show stark differences in the production of scientists and engineers by level of tertiary education and across scientific fields. In France, for example, national data show that between 1999 and 2001, the number of science graduates fell by 8.5% at the first degree level (licence) and by 5% at the second degree level (maîtrise). In contrast, the number of graduates of advanced research programmes (Diplôme d’Études Approfondies and Doctorat) increased slightly. A recent European Commission report on student enrolment in science and engineering programmes found that trends in enrolment in science and engineering vary sharply by individual field and level of study in France, Germany and the United Kingdom (European Commission, 2004):
152
• In France, the number of new entrants into the first-level university programmes fell by 5% in the physical sciences and by 10% in the life sciences between 2001 and 2003. The number of students enrolled in second-level programmes fell by 10% in the physical sciences and by 2% in the life © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Figure 5.5. Tertiary enrolment in science and engineering fields (cont.) 5.5b. Average annual growth rate of new students, 1998-2002 (%) S&T enrolment
Total enrolment
Denmark Iceland Portugal (1998-2000) Poland Czech Republic Israel Finland Australia Ireland Turkey Slovak Republic (1999-2002) United Kingdom (1999-2002) New Zealand Korea Norway Sweden (1999-2002) Switzerland (1999-2002) Canada (1998-2001) Belgium (2000-2002) Hungary Spain Japan Austria Italy -5
0
5
10
15
20
25 %
Source: OECD Education database, 2004.
sciences, but rose by 12% in engineering programmes. At the PhD level, enrolments increased by 8% in physical sciences and by 38% in life sciences and by 19% in engineering. • In Germany, enrolments in physics and chemistry fell at all levels between 1993 and 2002, but an improvement was observed for physics graduates. • In the United Kingdom, the overall student population grew by 18.8% between the 1996/97 academic year and 2001/02 academic year, but without major increases in science and engineering enrolments. Enrolments in chemistry and physics fell from 4.2% of all students enrolled in 1996/97 to 3.2% in 2001/02. The number of students enrolled in the life sciences increased by 15.7%, while the number enrolled in the physical sciences fell by 10.2%. At the same time, enrolments increased by 61% in computer science but were more or less stable in mathematics and engineering. The data on enrolment for these three countries show that there has been a slight decrease in enrolment at lower levels of tertiary education and in some fields of science. In contrast, enrolments in engineering programmes and in graduate level science and engineering programmes have continued to increase. Thus, while the supply of science graduates at all levels has increased, a decline in the number of science graduates at lower levels of tertiary education suggests that the pool of PhD students may become smaller in the future. However, this may not be the case if the fall is compensated by a rise in enrolment of foreign graduate students. Furthermore, part of the observed declines in enrolment may be related to attrition rates, as students who drop out of tertiary education do so in the early stages. In general, the contrast between a drop in enrolments at lower levels of tertiary education and a © OECD 2004
153
OECD Science, Technology and Industry Outlook 2004
Box 5.2. Interpreting enrolment data Interpreting trends in enrolments and their underlying causes must be done with great care. Historically, data on enrolments and graduates show that supply follows changes in demand, albeit with a lag. Nevertheless, there is not a direct relationship between undergraduate and graduate enrolments, or between them and graduate rates. In some OECD countries, enrolment in a given field of study, notably at the lower levels of tertiary education, is only partly correlated with the field of study at the time of graduation. In some countries, it is relatively commonplace to change field of study in the first years of tertiary study. In others, where selection into tertiary education is highly competitive and the curriculum rigid it is more likely that a student who enrols in a mathematics, science or engineering programme will receive a degree in the same or related field. This is especially true at higher levels of tertiary education, such as the PhD level, where accumulated investment in a specialised field increases switching costs. It is important to recall that the different levels of tertiary education have different missions and reflect a division of labour. In general, universities and vocational schools aim to provide the largest number of well-trained students for the local and national labour market. Graduate schools, in contrast, tend to produce advanced graduates in a variety of fields, including future teachers and professors. Graduate schools also recruit from a larger pool of candidates both nationally and internationally. Indeed, some graduate programmes compete at international level for the best students. Funding systems and incentives for undergraduate and graduate study also differ, and this has an impact on enrolments at different levels of tertiary education. Students enrolled in tertiary education programmes may drop out (attrition) or take temporary leave, further diminishing the predictive value of enrolment data. Demographic trends influence the trends in enrolments, but the effects may be countered by public policies and labour market conditions. For example, in some countries where the total youth population has fallen, such as Norway, enrolments in tertiary education have nevertheless increased, in large part owing to greater participation by women. Most importantly, business cycles and the job market for graduates exert a strong influence on the level and field of enrolment, especially at the initial tertiary level, although with a time lag. This means that in the short term, it is possible to observe a drop in enrolments at one level of tertiary education and a continued increase at another.
continued rise at a higher level illustrates the time-lagged influence of business cycles on the choices of younger students. Data for the United States reveal similar differences in the supply of scientists and engineers by level of degree and field of study. At the undergraduate level, the number of science and engineering graduates increased steadily from 323 000 in 1989 to almost 400 000 in 2000. Gains have been strongest in the biological and agricultural sciences, followed by computer sciences, psychology and social sciences. The number of bachelor degree graduates in engineering has fallen since the 1990s, and that of graduates in the physical sciences and mathematics has stagnated or declined in recent years, perhaps because of movement into other fields (e.g. computer sciences) (Figure 5.6a). At the PhD level, degrees awarded in all science and engineering fields increased during the beginning of the 1990s, but began to tail off towards the end of the decade. Degrees in engineering dropped most noticeably after 1997, following more than a decade of significant growth. Reductions in the physical sciences were also pronounced, while those in the social sciences and biological and agricultural sciences declined to a lesser degree (Figure 5.6b).
154
In the longer term, US graduation rates may benefit from growing enrolments. Enrolments in undergraduate engineering programmes increased after 1999 to around 421 000 in 2002 (NSF, 2004). Data on undergraduate science enrolments are not available (owing in part to the structure of the US higher education system and the possibility that students may change their field of study during their course of study), but the NSF reports that at least 30% of first-year university students intend to major in science and engineering – a figure far above current graduation rates. Historically, fewer than half of first-year students who intend to major in science and engineering actually complete their © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Figure 5.6. Number of US degrees awarded in science and engineering fields a. Bachelor’s degrees Social sciences
Biological/agricultural sciences
Psychology
Computer sciences
Physical/geosciences
Mathematics
Engineering
140 000 120 000 100 000 80 000 60 000 40 000 20 000 0
1989
1991
1993
1995
1996
1997
1998
2000
b. Doctoral degrees Social behavioral sciences
Biological/agricultural sciences
Engineering
Physical/geosciences
Mathematics
Computer sciences
9 000 8 000 7 000 6 000 5 000 4 000 3 000 2 000 1 000 0
1989
1991
1993
1995
1997
1999
2001
Source: NSB (2004b).
degrees within five years. At the graduate level, the number of students enrolled in US science and engineering programmes grew rapidly after 1999 to 455 000 in 2002, more than compensating for the declines of the mid-1990s which were especially pronounced in the social sciences and the physical sciences (Table 5.2). New graduate enrolments (first-time graduate students) also rose sharply, from 75 000 in 1999 to 87 000 in 2002, possibly as a result of the economic downturn in the United States and the end of the dot.com era, which had lured many students away from graduate studies, especially in high-technology fields. These enrolments could push up US PhD production in future years.
© OECD 2004
155
OECD Science, Technology and Industry Outlook 2004
Table 5.2. US graduate student enrolment in science and engineering, 1992-2002 Graduate students
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
430 517 290 408 83 102 207 306 140 109
435 723 293 905 79 280 214 625 141 818
431 142 292 979 78 038 214 941 138 163
422 466 287 171 74 364 212 807 135 295
415 181 284 039 73 448 210 591 131 142
407 630 280 669 73 600 207 069 126 961
404 856 278 943 74 373 204 570 125 913
411 182 283 893 75 447 208 446 127 289
413 536 291 355 78 332 213 023 122 181
429 242 304 021 82 411 221 610 125 221
455 355 325 699 86 921 238 778 129 656
Men Women
280 305 150 212
279 185 156 538
272 031 159 111
262 256 160 210
253 510 161 671
245 619 162 011
241 429 163 427
242 786 168 396
243 057 170 479
251 812 177 430
266 521 188 834
Post-docs
23 883
24 665
25 787
26 160
26 569
27 264
27 876
28 980
30 224
30 194
32 075
All graduate students Full time First time Other Part time
Source: National Science Foundation/Division of Science Resources Statistics, Survey of Graduate Students and Post-doctorates in Science and Engineering, 2002.
Comparing tertiary enrolment data and international mathematics and science tests While tertiary enrolment data provide insight into the near-term trends in the future supply of science and technology workers, international benchmarking studies such as the OECD PISA (Programme for International Student Assessment) survey or the TIMSS (Third International Math and Science Study), can provide an indication of countries’ longer-term potential to produce science and engineering graduates. According the 2001 PISA Assessment of Reading, Mathematical and Scientific Literacy, Japan, Korea, New Zealand, Finland and Australia ranked highest in mathematical literacy. In scientific literacy, Korea, Japan, Finland, the United Kingdom and Canada ranked highest. Among the larger EU countries, France ranked 10th in mathematics and 12th in scientific literacy while Germany ranked 20th in both mathematical and scientific literacy (OECD, 2003). In general, there is a positive but imperfect relationship between the ranking of countries whose students score high in mathematics and science and their ranking in the production of science and engineering graduates and researchers. Finland, for example, has the highest number of researchers per 10 000 workers in the OECD area, and ranks second in the share of science and engineering enrolments in tertiary education, fourth in the share of PhDs in science and engineering and seventh in terms of the share of university graduates with degrees in science and engineering. Finnish students performed well on both the science and technology literacy PISA assessments. Japan, however, ranks first in mathematical literacy among OECD countries and third in terms of researchers per 10 000 in the workforce but nineteenth in share of science and engineering enrolments and twelfth in terms of the percentage of science and engineering graduates. Differences in ranking most likely reflect differences in student interest and performance at different levels and stages of their higher education system, although, as noted above, the relationship between entrants into tertiary education and numbers of graduates and science and technology workers is not direct. Nevertheless, the OECD countries whose youth score high in international mathematics and science tests are among those with the largest numbers of science and engineering graduates and PhDs relative to other graduates and with relatively large supplies of researchers. Meeting demand through immigration
156
One way in which governments seek to increase the pool of graduates and science and technology professionals is to attract foreign talent. International mobility widens the pool of scientific talent, helping firms and institutions to meet demand, especially in specialised areas, and improves the diffusion of knowledge between institutions and across borders. While economic factors play a role in decisions to migrate, factors such as strong support for research and an entrepreneurial climate of close co-operation between public research and industry are also important, perhaps more so for young researchers. In fact, surveys indicate that much of the international migration of scientists and engineers © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Box 5.3. Supply and demand for ICT workers There have been recurrent concerns about shortages of workers in information and communication technologies. Since the mid-1990s and with growing business demand for IT professionals, many OECD countries expanded the number of degree programmes in information technology. Between 1998 and 2002, the number of students enrolled in computing as a share of all students enrolled in science and technology programmes at tertiary level nearly doubled in Australia, Finland, Iceland, Ireland and Norway (Figure 5.7). Thus, and despite the fact that non-tertiary education institutions increasingly provide ITrelated training, enrolments in computing account for a larger share of science and engineering enrolments at tertiary level than in the past. National data for a number of countries, including the United States, show however that undergraduate and graduate enrolments in computer science programmes has tapered off since 2000, partly in response to a drop in demand for IT-related workers following the internet bubble. The current downturn in demand for IT specialists has dampened recruitment of foreign IT talent in a number of OECD countries (e.g. the United States, Germany). Data on holders of temporary visas for hightechnology workers (with universities among the top recruiters) show a drop in petitions since the 2001 downturn in the US economy and greater scrutiny in the aftermath of 11 September 2001. The US government has recently lowered the number of H-1B visas from 195 000 to its former level of 65 000. While IT-related workers accounted for just over half of the approved H-1B petitions in FY 2001, their share fell to around 38% in FY 2002 (OECD, 2004a).
Figure 5.7. Share of new students enrolled in computing, 1998-2002 As a percentage of total science and technology enrolment at tertiary level 2002
1998
Norway Iceland Australia Ireland United Kingdom (1999-2002) Spain Canada (1998-2001) Austria Hungary Portugal (1998-2000) New Zealand Finland Sweden (1999-2002) Switzerland (1999-2002) Slovak Republic (1999-2002) Denmark Belgium (2000-2002) Czech Republic Korea Italy Turkey 0
5
10
15
20
25
30
35
40
45 %
Note: OECD harmonised enrolment data are not available for France, Germany and the United States. Source: OECD Education database, 2004.
157
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
is highly localised around knowledge-intensive clusters and centres of excellence. For young researchers, mobility is often a means of obtaining world-class training (e.g. at post-doctorate level) that may not be available locally. The international mobility of students, scholars and other highly skilled workers has increased over the past decade, driven in part by the globalisation of higher education and changes to the immigration legislation of OECD countries that favour skilled migrants. In 2000 there were 1.5 million foreign students enrolled in higher education institutions in OECD countries compared to half that figure just two decades earlier (OECD, 2003a). The United States, United Kingdom, Australia and Canada together host more than half of all foreign students in the OECD area. Among the main sending countries are China, Korea, India, and Japan. EU countries attract more students from within Europe (54% of foreign students in Europe are European). The share of foreigners in the student population is higher at the graduate level than at the first university level (bachelor degree). In absolute terms, the United States receives more foreign PhD-level students than other OECD countries. In relative terms, however, Switzerland, the United Kingdom and Belgium have a greater share of foreigners among their PhD-level students (Figure 5.8). The number of foreign PhDs in science and engineering more than doubled between 1985 and 1996 in the United States. Most recent foreign PhDs in the United States, however, are on temporary visas, a trend that increased in the 1990s. The United States also receives a significant number of non-student, nonimmigrant scholars (around 86 015 in 2001-02, representing an average annual growth rate of 4.6% since 1993-94). As with most highly skilled migration flows to the United States, the majority of the scholars are from Asia. Around 18% are from China; but around half come from other OECD countries including Japan and Korea. For most OECD countries, nationals who are scholars in the United States represent only 2% to 4% of the country’s university researcher population. This share is higher, however, for certain sending countries such as Russia and Korea. While the United Kingdom sends students and scholars to the United States, it is also a receiving country. According to the Higher Education Statistics Agency, the number of foreign academics in the United Kingdom reached 3 185 in 2001-02, up 21% from 1995-96 (HESA, 2004).
Figure 5.8. Foreign PhD students as a percentage of total PhD enrolment, 2001 Switzerland United Kingdom Belgium United States Australia Sweden Denmark (1999) Canada (2000) Norway Austria Iceland Spain New Zealand Czech Republic Portugal (2000) Finland Turkey (1999) Slovak Republic Korea Mexico Italy
36.2 37.7 28.0 40.5 32.8 55.7 35.2 37.4 39.7 43.9 38.8 34.1 47.2 35.5 23.5 17.6 Percentage of women 32.7 38.1 0
158
5
10
15
20
25
30
35
40
45
Source: OECD, Education database, 2004.
© OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
Recent US data show a slight drop in the number of first-time foreign PhD students and foreign scholars on temporary visas in the country, although the number of foreign PhD graduates has continued to rise (NSF, 2004). The drop in first-time foreign PhD students has been attributed in part to stricter immigration rules, as well as growing competition from other OECD countries. Indeed, the United Kingdom reported a 21% rise in number of students from non-EU countries over the 2001-02 and 2002-03 year (from 152 625 students to 184 685). Australia also experienced a significant rise in international student enrolment in higher education, from 86 269 in 2001 to 136 252 in 2003. Since 1994, the number of foreign students enrolled in Australia’s higher education system has more than tripled, but only 539 of these were enrolled in PhD degree programmes in the natural sciences, engineering and information technology in 2003 (OSS, 2003; Mervis, 2004). Furthermore, data on the percentage of foreign PhDs in the United States who plan to remain in the country two years after graduation reveal that the stay rate has continued to rise, from 49% in 1987 to 71% in 2001. Stay rates of foreign students differ, however: over 50% of foreign students from France and the United Kingdom and 70% of those from China had plans to stay in the United States in 2001 (NSF, 2004). However, while Chinese students have a high stay rate, data from the Chinese Ministry of Science and Technology reveal that a growing number of overseas Chinese students are returning, contributing to China’s economic and scientific development. Still the numbers of returning students are far below the number of students going abroad (Figure 5.9). The United States continues to attract a large number of foreign science and engineering students at the graduate level, despite growing competition from other OECD countries and the recent decrease in new first-time foreign graduate students and scholars. Although there are concerns that as sending countries develop their own opportunities for research and innovation, the number of students going abroad will fall or those returning will increase, receiving countries in the OECD area will not necessarily suffer. The development of global research and innovation networks between returning foreign researchers and their former host countries can offer opportunities for both sending and receiving countries. Some research shows that foreign PhDs that leave the United States, for example, return at a later date for further research or business purposes (Regets, 2004). Several OECD countries in Europe and elsewhere are also expanding their efforts to retain national and foreign talent as well as foster the return migration of expatriate researchers. For example, the
Figure 5.9. Outward and return migration of Chinese students, 1991-2001 Overseas Chinese students
Chinese students returned
90 000
75 000
60 000
45 000
30 000
15 000
0 1991
1992
1993
1994
1995
1996
1997
Source: Gao Changlin, data from MOST, China Science and Technology Indicators 2002.
© OECD 2004
1998
1999
2000
2001
159
OECD Science, Technology and Industry Outlook 2004
Box 5.4. Supply of science and technology graduates in non-OECD countries Non-OECD countries account for a growing share of the world’s supply of university graduates. For example, the number of university graduates in China in 2000 (739 000) was equivalent to 13% of the total number of graduates in the OECD area. The Chinese Ministry of Science and Technology (MOST) reports that more than half of university graduates receive degrees in science and engineering. The number of graduates from India’s universities is equivalent to around 12% of the OECD total while the number of Russian university graduates is equivalent to 11% the OECD total. While many students from non-OECD countries continue to receive a large part of their advanced higher education in OECD countries – around 84 000 Chinese students were studying abroad in 2001 – more and more of them are receiving university degrees, including at the PhD level, in their home countries. For example, while OECD countries produced 147 000 PhDs in 2000, China, Brazil, India, Russia and Thailand collectively produced 87 115, equivalent to around 60% of the OECD total. Despite the success of non-member economies in increasing the supply of science and technology graduates, they too face a number of policy challenges. In Russia, the policy focus is on encouraging graduates to pursue careers in research and teaching in order to offset the reduction in researcher employment and the rapid ageing of the research workforce. Like OECD countries, India also reports declining interest in science among youth, as evidenced by a declining in enrolments in science and engineering. China, which ranks third worldwide in the number of researchers, is currently revising curricula to improve the quality of higher education under the University Teaching Quality and Teaching Reform Project. Although over 50% of tertiary graduates in China receive degrees in science and engineering, there has been a gradual increase in the share of graduates in areas such as business, law and entrepreneurship. The Chinese Ministry of Personnel has espoused a policy of encouraging highly skilled overseas Chinese to return to China, and their numbers rose on average by 13% a year in the 1990s. Related to this goal, the Ministry is supporting the construction of university laboratories and the development of science parks to provide venture opportunities for returning Chinese as well as employment opportunities for young graduates. Source: OECD; Chinese Ministry of Science and Technology, 2004.
Canadian Foundation for Innovation (CFI), which funds research infrastructure at universities and research hospitals, recently announced a CAD 23.8 million investment by the New Opportunities Fund and the Infrastructure Operating Fund for some 124 projects involving 140 researchers at 40 institutions and across a wide spectrum of frontline research.
160
The French government has launched a regional development plan, “Attractiveness of Regions” (Attractivité du territoire) that will provide funding to help institutions recruit high-quality foreign researchers to France as well as to facilitate the return migration of French post-doctorates (Commissariat général du Plan, 2004). In Spain, the government’s Ramon Cayal programme is providing 2 000 temporary research positions (with five-year contracts) in public research centres and universities, in addition to regular procedures for tenure-track jobs, in order to increase science and technology capabilities in public labs and universities. The programme also aims to offer stable jobs to excellent researchers returning from abroad and to increase their employability and improve their academic career opportunities. Meanwhile, the UK is expected to enact an entitlement that will allow foreign students in science, technology, engineering and mathematics to work in the United Kingdom for 12 months. New scholarships (Dorothy Hodgkin Postgraduate Awards) will be granted to over 100 PhD students from India, China, Hong Kong (China), Russia and other developing countries for study in the United Kingdom. The German government plans to increase the share of foreign students from 8.5% to 10%, but also to increase the share of German students having studied abroad from 14% to 20% by 2010. © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
What can governments do to foster domestic development of HRST? For most OECD countries, recruiting foreign talent is neither sufficient to meet long-term demand for trained scientists and researchers in business and universities nor politically or economically sustainable. One of the lessons from OECD countries such as Finland that have succeeded in increasing the supply of science and technology graduates at all levels is that policies should focus on the entire supply pipeline, from primary and secondary schooling to university education and PhD training, and should involve industry to leverage competencies and resources (Arajarvi, 2004, Academy of Finland, 2003). Over the past few years, OECD countries have implemented a range of initiatives to stimulate the domestic supply of graduates and improve the attractiveness of research careers:2 • Raise interest in and awareness of science, especially among youth via science fairs, science days and science years (e.g. Jahr der Physik in Germany in 2000), demonstration projects at schools, and the creation and renovation of science museums. Australia has established a nation-wide touring outreach programme for secondary students, Smart Moves, which aims to motivate young people’s interest in science and entrepreneurship. In Germany, the research competition for students, Jugend forscht, as well as the International Mathematical, Physics, Chemical and Biological Olympiads, are used to encourage young people to pursue studies in mathematics and science. Ireland has implemented a programme, known as Discover Engineering and Science, to raise the general awareness of the physical sciences and encourage more students to study the subjects at second and third level and to pursue careers in this area (www.science.ie). • Improve teacher training. At the primary and secondary level, OECD countries like Finland, the United States and the United Kingdom have implemented measures to improve the quality of science and mathematics teachers, ranging from the recruitment of Master’s and PhD graduates for secondary-school teaching to raising salary levels and incentives for teachers. In the United States, where some 56% of students studying the physical sciences and 27% of students in mathematics at secondary schools are taught by teachers without formal qualifications in the field, the Math and Science Partnership (MSP) programme, funded at USD 260 million in 2003, links primary and secondary school teachers with scientists and mathematicians at higher education institutions. Norway launched new education programmes in 2003 to provide training for teachers in mathematics and science, as has Ireland. • Revise curricula. Universities in OECD countries have also reviewed undergraduate curricula and reformed PhD training in order to make programmes more responsive to student needs and demands from industry. Some have created interdisciplinary programmes, linking biologists with computer scientists, for example, in order to meet demand for skills in bioinformatics. Universities are also partnering with industry to train PhDs and post-doctorates to improve the match between researcher skills and industry demands. Other countries have shortened degree programmes in a bid to reduce dropout rates. Universities in the EU, as well as in Switzerland, have also moved to harmonise degrees along the bachelor-master system up to doctorate level to improve recognition of diplomas and foster mobility between member states. • Recruit women and other under-represented populations. Most OECD countries, including Canada, Germany, Korea, the Netherlands, the United Kingdom and the United States have measures to improve participation of women in science and engineering (Box 5.5). Yet it is not just a question of encouraging women to study science; firms and higher education institutions can do more to recruit and retain women in research. Measures are also being implemented to increase the participation of national minorities in science education, especially in the United Kingdom, the United States and the Netherlands. • Increase funding for PhD students and post-docs. Science Foundation Ireland, the Irish Research Council for the Humanities and Social Sciences and the Irish Research Council for Science, Engineering 2. For a more detailed summary of recent policy initiatives in the area of human resources in science and technology, readers should refer to Chapter 2 in this publication.
© OECD 2004
161
OECD Science, Technology and Industry Outlook 2004
Box 5.5. Women in science and technology OECD countries have long sought to increase the participation of women in science and engineering education and careers not only to improve social equity in higher education and the workplace but also to increase the overall supply of science and engineering graduates. The share of women among university graduates now exceeds that of men in several countries; however women account for only 30% of university degrees in science and engineering and 27% of all PhDs. In 2002, the share of women enrolled in science and engineering studies ranged from a low of 12.7% in Japan to 39.7% in New Zealand. Participation by women in PhD studies varies greatly by country, ranging from 22.8% of PhD graduates in Japan in 2001 compared to 42.7% in France, 45% in the United States, 50.8% in Italy. Women also tend to have lower rates of participation in international student mobility, in particular at graduate level. In 2002, the percentage of women among foreign PhDs enrolled in the Slovak Republic was 18% compared to 36% in Switzerland; 41% in Australia and 55.7% in Denmark. The share of women among foreigners with science and engineering PhDs residing in the United States in 1999 was 17.7% for nationals from the United Kingdom and 22.5% for nationals from Germany. Although women account for close to half of the workers in science and technology occupations (broadly defined), their share among researchers is quite small in many countries. Women researchers account for 19.4% of researchers in the higher education sector in Japan; 26.6% in Switzerland; 43.3% in Sweden and 32.3% in France. Fewer women than men also report being interested in science according to EU and US public opinion surveys (Eurobarometer, 2001; NSF, 2004). OECD countries are taking a variety of steps to improve the representation of women among science and technology graduates and researchers. Measures range from grants to support positions for women at universities to preferential policies towards equally qualified women candidates. Recent research suggests that efforts to close the gender gap in science must begin at the earliest levels of schooling. On the employment side, equal opportunity policies, flexible working hours and parental leave are also important for encouraging women to pursue research careers in the public and private sectors.
and Technology have introduced several programmes to fund post-graduate researchers in third-level institutions. The Japanese Ministry of Education, Culture, Sports, Science and Technology (MEXT) is increasing the amount of competitive research funding while expanding opportunities for postdoctoral fellows and others to participate in research projects supported with competitive funds, as well as promoting various support programmes for bright doctoral students and post-doctoral fellows (e.g. Japan Society for the Promotion of Science). In France, the Ministry for Research has increased funding for the training programme “Young Men and Women Researchers” (Jeunes chercheuses et jeunes chercheurs) by 17% over the last year in order to encourage graduates to remain in research. The above measures focus largely on the supply side, but demand-side policies are also important for avoiding a drop in graduates and increasing supply. Business framework conditions that encourage firms, including SMEs, to invest in R&D and innovation help broaden the demand for science and technology graduates. As the service economy continues to grow in OECD countries, incentives for innovation and R&D activities in the service sector widen job opportunities for science and technology graduates; this in turn contributes to overall economic competitiveness. Diversifying the demand for science and technology graduates is especially important in countries where the public research sector is the main employer of researchers. By diversifying the demand for science and technology graduates across economic sectors, countries can limit the risk of a sudden drop in enrolments in response to a temporary or cyclical reduction in public or business R&D spending. Governments should also focus on demand-side policies for HRST to improve the match between supply and demand and avoid skill mismatches or worse, a “brain loss” or “brain drain” whereby graduates, unable to find appropriate jobs take lower-level jobs or are forced to emigrate: 162
• Foster mobility of young researchers. Disincentives and barriers to the mobility of graduates and young researchers can prevent labour markets from clearing and aggravate shortages or skill © OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
mismatches. The EU, through programmes such as the Marie Curie fellowships, is making it easier for researchers to move across borders, but barriers remain (e.g. language, as well as issues related to moving a family or finding work for spouses or affordable housing). OECD countries such as France and Japan have reformed employment regulations in the public sector to allow researchers to work in industry for a limited period while retaining their employment status. Proposals are also afoot in Italy to allow university staff to carry out remunerative activities outside the university. • Increase the attractiveness of public research employment. Several OECD governments are increasing access to and number of public research jobs. The French government plans to create additional contract-based positions in public labs for three to five years and some 1 000 new posts for university researchers by 2005, in line with its objective to raise total R&D funding to 3% of GDP. The United Kingdom is increasing financial support for PhDs and post-docs following a recent government review. • Make employment more flexible. This is one way to help firms and universities attract and retain young people in research while being responsive to changes in research funding and priorities. The Italian government is currently considering reforms to public research employment that would provide new PhDs with renewable five-year contracts after which they would compete for permanent professorships. A key challenge for governments and research institutions is achieving flexibility in employment while promoting attractive career progression. • Improve the provision of information regarding job opportunities for young graduates, especially in the business sector. Given that there is a significant time lag between changes in the labour market and the response of higher education systems, there is also a strong argument for governments and education institutions to improve the provision of information about the labour market for students in science and technology. This can also be a means to make potential PhD science and engineering graduates aware of careers outside academia. Conclusion and outlook Recent trends in business R&D spending as well as in the higher education sector suggest that demand for science and engineering trained personnel will continue to grow. The transition to knowledge-based economies will require increasing numbers of scientists, engineers and professionals, including researchers. As efforts are made to bolster R&D spending throughout the OECD area, demand may expand further, whether or not specific targets are achieved. Demographic changes will result in the retirement of many current science and technology workers, creating a need for even more new scientists and engineers to enter the workforce. Most OECD countries are taking this challenge seriously and have or are implementing a range of policies to increase the supply of new science and engineering graduates and to improve the attractiveness of scientific studies and of research careers. The ability of supplies of new graduates to meet demand will vary considerably across countries and fields of science and technology. Available statistics do not show dramatic reductions in science and engineering graduates across the OECD area; they show instead that the overall number of tertiarylevel science and engineering graduates continued to expand at the turn of the century in the EU, Canada, Japan, Korea and the United States. The larger EU economies such as France and the United Kingdom experienced positive growth in the number of science and engineering graduates at the tertiary level overall, but they have witnessed recent declines in enrolments in specific scientific fields (physics and chemistry) and at lower levels of tertiary education. Germany, however, has experienced a drop in science and engineering graduates and has suffered a drop in enrolments in fields like physics and chemistry. The situation is somewhat more positive in the Nordic countries, which have in general seen solid growth in the number and share of science and engineering graduates. Enrolments in science and engineering have also continued to rise, especially in Denmark and Iceland where they have grown faster than total university enrolments. Among the new EU members in Central and Eastern Europe, the situation is somewhat mixed. The number of graduates in science and engineering increased in Poland and the Czech Republic but fell in Hungary. Meanwhile enrolments in science and engineering have © OECD 2004
163
OECD Science, Technology and Industry Outlook 2004
grown more slowly than total enrolment in all three countries. In Japan and Korea, the number of science and engineering graduates increased over the period, but in both countries, enrolments in science and engineering grew less rapidly than total enrolments. The growth in US science and engineering graduates was concentrated among science graduates; the number of engineering graduates actually slipped a little. US graduate enrolments have recently recovered after declining at the end of the 1990s. The longer-term outlook for supply and demand will depend on a variety of factors: an upturn in economic growth and investment in R&D might reduce the risk of prolonged drop in enrolments and graduates and the risk of shortages on the labour market. It might also create more opportunities for researchers in the business sector, especially in the EU. On the other hand, a sustained decline in business R&D or public research funding might discourage prospective students from seeking careers in research. Much will depend on the causes of the decline in enrolments and graduate rates and the ability of market and policies to respond. Governments play a key role in ensuring that young people and firms have incentives to invest in science and engineering education. Supply-side policies should focus on the entire educational pipeline from primary to university education. OECD data show that the leading countries with the largest number of science and engineering graduates and PhDs relative to other graduates and a greater supply of researchers are among those that score highest in international youth mathematics and science tests. This would tend to suggest there is a positive association between early success in these subjects and the supply of science and engineering graduates. At the same time, success on the labour market is an important and positive signal for young people considering scientific studies. Demand-side policies such as those that stimulate demand for young researchers or make public research careers more attractive and rewarding are needed to ensure that young people continue to invest in science and engineering education. Finally, most of the world’s investment in R&D remains concentrated in OECD countries, but a growing share of the supply of science and engineering graduates is being generated in non-OECD countries (e.g. China, Singapore, Chinese Taipei, India and Brazil). While the higher education and research systems in OECD countries will continue to provide science and technology graduates from non-OECD countries with opportunities for further training and employment, in the longer term, a greater capacity for R&D in terms of institutions, human resources and finance in other parts of the world will put pressure on OECD countries to raise the quantity and quality of their science and technology workforce.
164
© OECD 2004
Ensuring the Supply of Human Resources in Science and Technology
REFERENCES
Academy of Finland (2003), PhDs in Finland: Employment, Placement and Demand, Publications of the Academy of Finland, Helsinki. Arajarvi, M. (2004), “Enhancing Public Understanding and Attractiveness of Science among Youth: Lessons from the LUMA Programme in Finland”, in Proceedings of the 2003 Joint OECD-CNR Conference on Fostering the Development of Human Resources for Science and Technology, CNR Press, Rome. Australian Education International (AEI) (2003), Student Enrolment and Visa Statistics, available at: www.aei.dest.gov.au. Brainard L. and Litan R. (2004), “Offshoring, Service Jobs: Bane or Boon and What to Do?”, The Brookings Institution Policy Brief, No. 132, Washington DC. Commissariat général du Plan (2004), “Attractivité pour les étudiants étrangers et potentiel de la recherche en France”, Les quatre pages de Saraswati, No. 2, june. Butz, W. et al. (2003), “Is There a Shortage of Scientists and Engineers?”, Rand Corporation Working Paper, Santa Monica, California. Eurobarometer (2001), Europeans, Science and Technology, Public Opinion Analysis, European Commission, Brussels. European Commission (2003), Key Figures in Science and Technology, Brussels. European Commission (2004), “Draft Report on Increasing Human Resources for Science and Technology”, presented at the EC conference, Europe Needs More Scientists, Brussels, 2 April. Forfás (2003), Responding to Ireland’s Skill Needs: Fourth Report of the Expert Group on Future Skill Needs, October, Dublin, available at: www.skillsireland.ie/press/reports/pdf/egfsn0310_4th_skills_report.pdf. HESA (2004), Higher Education Statistics Agency, available at: www.hesa.ac.uk. HM Treasury (2002), SET for Success: The Supply of People with Science, Technology, Engineering and Mathematics Skills, Government of the United Kingdom HMSO, London. Mervis, J. (2004), “Is the US Brain Gain Faltering?”, Science, Vol. 304, Issue 5675, 1278-1282, 28 May. MEXT (2003), White Paper on Science and Technology, Ministry of Education, Culture, Sports, Science and Technology, Tokyo. NAS (2001), Building the Workforce for the Information Economy,National Academies Press, Washington DC. National Science Board (2004a), The Science and Engineering Workforce: Realizing America’s Potential May, Arlington, Virginia. National Science Board (2004b), Science and Engineering Indicators 2004, National Science Foundation, Arlington, Virginia. Observa (2004) “The ‘Crisis’ of Science Vocations and its Causes”, preliminary report prepared for the Italian Association of Science Deans, Vicenza. OECD (2003a), Science, Technology and Industry Scoreboard, Paris. OECD (2003b), Education at a Glance, Paris. OECD (2003c), Literacy Skills for the World of Tomorrow – Further Results from PISA 2000, Paris. OECD (2004a), Trends in International Migration: Sopemi Report 2003, Paris. OECD (2004b), Information Technology Outlook, Paris. Regets, M. (2004), International Migration of the Highly Skilled, NSF Publications (forthcoming). Arlington, Virginia. Smalley, R.E. (2003), “Nanotechnology, the S&T Workforce, Energy and Prosperity”, presentation made at the meeting of the US President’s Council of Advisors on Science and Technology (PCAST). Washington DC, 3 March. Van Dijk M. and D. Webbink (2000), Shortages of Scientists, CPB Report. Vol. 4. The Hague. Yamamoto, S. (2003), “Mismatches in Supply and Demand for S&T Graduates at PhD Level”, in Proceedings of the 2003 Joint OECD-CNR Conference on Fostering the Development of Human Resources for Science and Technology, CNR Press, Rome.
© OECD 2004
165
Chapter 6
MULTINATIONAL ENTERPRISES AND PRODUCTIVITY GROWTH: INSIGHT AT THE FIRM LEVEL
Multinational enterprises (MNEs) account for a large and growing share of employment and production in OECD countries – particularly in the manufacturing sector. Recent developments in the kinds of data accessible to economists have provided more powerful tools for investigating the effects of MNEs on OECD economies. This chapter reviews a selection of recent work that uses these new data sources to examine the contribution MNEs make to productivity growth in their home countries and abroad. It draws extensively on papers presented at an OECD workshop on this topic and draws some implications for current issues confronting policy makers, such as outsourcing, the formation of globally competitive firms and the desire to improve regional performance by attracting overseas activities back home.
167
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Introduction Multinational enterprises (MNEs) have played a significant role in economic growth and development for years, if not for centuries. Recently, as concerns about their effects and those of their foreign affiliates on both their home and host economies have mounted, the role they play has taken centre stage in general public debate (O’Rourke and Williamson, 2000). In home countries, the establishment of foreign affiliates by domestic companies is often interpreted as an outsourcing of jobs and production that results in domestic losses; in host countries, the establishment of foreign-owned plants is sometimes viewed as raising dependence on foreign technology and contributing to outflows of knowledge and economic benefits. Public debate on these issues can be emotional and political in nature, and often relies on anecdotes relating to a small number of firms. The broader economic effects of MNEs on home and host economies are in fact not well understood and have not been sufficiently analysed. This is to a large degree attributable to a paucity of data, which has limited the ability to analyse MNEs rigorously. A better understanding of the contribution of various types of MNEs to productivity growth is important because many countries provide incentives to attract and retain foreign affiliates of MNEs on the assumption that they boost productivity, directly and indirectly, through transfer of technology, introduction of advanced management practices and increased competition. Likewise, some governments help industries to consolidate and restructure so as to create globally competitive MNEs with domestically based parents. For their part, firms may threaten to relocate activities abroad to gain improvements in various elements of the business environment, such as labour markets, corporate tax rates or regulations. Implicit in government policy is the belief that the parent and/or affiliates of MNEs are important to economic growth and productivity. Many analyses support this view, but some recent work indicates the limits of these benefits. MNEs can lower productivity if they hire highly skilled workers away from domestic plants (Aitken and Harrison, 1999) or target foreign direct investment (FDI) to weak domestic industries in order to capture their markets, which does little to boost aggregate productivity growth (Keller and Yeaple, 2003). Recent developments in the kinds of data accessible to economists have provided more powerful tools for further investigating the effects of MNEs on OECD economies. The availability of firm-level data on the activities of MNEs, as opposed to the investment flows associated with them, has made it possible to measure better the contributions of MNEs to employment, innovation and productivity growth and compare these with those of with uni-national firms. This chapter reviews a selection of recent work that uses these new data sources to examine the contribution MNEs make to productivity growth in their home countries and abroad. It draws extensively on papers presented at an OECD workshop on this topic and draws some implications for current issues confronting policy makers, such as outsourcing, the formation of globally competitive firms and the desire to improve regional performance by attracting overseas activities back home.1 In doing so, the chapter illustrates the value of these new data for a deeper analysis of important economic questions. The changing role of MNEs in OECD economies
168
As aggregate statistics show, MNEs account for a large and growing share of employment and production in OECD countries – particularly in the manufacturing sector (OECD, 2001a). In 2001, the share of manufacturing output under the control of foreign affiliates of MNEs ranged from just under 3% in Japan to more than 70% in Hungary and Ireland, with most countries falling between 20% and 50% (Figure 6.1a). MNEs accounted for close to 50% of manufacturing employment in Ireland and Hungary © OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
Figure 6.1. Contribution of foreign affiliates to turnover and employment in manufacturing, 2001 a. Share of foreign affiliates b. Share of foreign affiliates in manufacturing turnover in manufacturing employment Ireland Hungary Luxembourg3 Canada2 Czech Republic1 Belgium4 France United Kingdom3 Poland Sweden2 Norway Spain Austria Netherlands2 United States Italy3 Finland1 Portugal Turkey Denmark3 Germany Japan 80 %
60
40
20
0
Ireland Hungary Luxembourg3 France Czech Republic1 Sweden2 Norway Australia2 Poland United Kingdom3 Belgium4 Netherlands2 Austria Finland1 Spain Italy3 United States Denmark3 Portugal Turkey Germany 0
10
20
30
40
50 %
1. 2002. 2. 2000. 3. 1999. 4. 1997. Source: OECD AFA Database, July 2004.
in 2001 and between 15% and 30% in most other OECD economies, except Germany where the share was less than 6% (Figure 6.1b). In general, the role of MNEs is growing. Between 1995 and 2001, the shares of foreign affiliates in manufacturing turnover rose in all countries for which data are available except Germany and the Netherlands (Figure 6.2). Turnover under foreign control grew more quickly than that under domestic control, in many cases by a factor of three or more. Manufacturing employment in foreign affiliates also rose in all countries except Austria, Germany, Luxembourg and the Netherlands during this time; it fell in domestically controlled firms in all countries except Norway, Sweden and Ireland. In general, employment growth in foreign affiliates reflects not job creation in new, foreign-owned plants, but changes in the classification of jobs owing to acquisitions and changes in ownership. Labour productivity in foreign affiliates has also increased, with gains clustering between 5% and 10% a year in most OECD countries between 1995 and 2001. MNEs also play a growing role in the service sector, but their presence is not as large as in manufacturing. The share of service sector turnover under foreign control is considerably lower than in manufacturing, ranging from less than 1% in Japan to 34% in Hungary, with most of the larger OECD economies posting shares of 17% or less in 2001 (Figure 6.3a). Only in Norway, Italy and Finland did the share of foreign affiliates in services exceed that in manufacturing. The penetration of foreign affiliates in service sector employment is also lower than in manufacturing; their share of employment reached 19% in Belgium in 2002 but remains below 10% in most of the larger OECD economies for which data are available (Figure 6.3b). © OECD 2004
169
OECD Science, Technology and Industry Outlook 2004
Figure 6.2. Growth in turnover and employment foreign affiliates in manufacturing, 1995-2001 Average annual growth rate Turnover, % 30 Czech Republic5 25
Poland4
20
Finland Ireland Hungary
15
United Kingdom1
Sweden2 Japan Norway
France
10 United States
Luxembourg1
Italy1
5
Turkey
Austria Portugal3
0 Netherlands2 Germany
-5
-10
-10
-5
0
5
10
15
20 25 Employment, %
1. 1995-1999. 2. 1995-2000. 3. 1996-2001. 4. 1997-2001. 5. 1997-2002. Source: OECD AFA Database, July 2004.
Foreign affiliates account for a growing share of business R&D. Although R&D remains less internationalised than production, total R&D expenditures of foreign affiliates increased between 1991 and 2001 by more than 50% in the OECD area. In 2001, foreign affiliates accounted for 15% to 20% of total manufacturing R&D in France, Germany and the United States; between 30% and 40% in Canada, the Netherlands, Spain, Sweden and the United Kingdom; and more than 70% in Hungary and Ireland (Figure 6.4). Not surprisingly, R&D investments by foreign affiliates are highly sector-specific, with the ICT, chemicals (including pharmaceuticals) and transport sectors accounting for the vast majority. While patterns of R&D investment by foreign affiliates correspond to patterns of manufacturing investment, the location of business R&D is influenced not only by the need to tailor products to local markets but also by a desire to tap into local sources of scientific and technical knowledge. Nevertheless, the R&D intensity (R&D as a share of turnover) of foreign affiliates is below that of firms indigenous to the host country in all countries except Hungary and Ireland, and by a wide margin in most cases (OECD, 2003). Firm-level insight into the contribution of MNEs to productivity growth
170
While aggregate statistics highlight the significant – and growing – role of MNEs in OECD economies, they provide insufficient insight into their contribution to productivity growth. This requires the ability to break productivity growth down into its constituent parts and compare the performance of MNEs to unaffiliated domestic firms and ideally to compare foreign affiliates operating in a country with © OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
Figure 6.3. Contribution of foreign affiliates to turnover and employment in services, 2001 a. Share of foreign affiliates in turnover b. Share of foreign affiliates in employment Hungary Hungary Belgium (2002) Czech Rep. (2002) Poland1 (2002) Belgium (2002) Czech Rep. (2002) Poland1 (2002) Sweden3 (2000) Ireland2 (1997) Sweden3 (2000) Ireland2 (1997) Norway (1997) Finland3 Austria4 Finland3 Luxembourg3 (1998) Netherlands5 (2000) Austria4 Spain3 (2002) Italy United Kingdom5 (1999) Netherlands5 (2000) Denmark (1999) Spain3 (2002) France (1998) Portugal5 (2000) Italy Denmark (1999) Portugal5 (2000) Luxembourg3 (1998) France (1998) United States1, 6 (1997) Germany5 United States1, 6 (1997) Norway (1997) United Kingdom5 (1999) Germany5 Japan3, 7 (2000) Japan3, 7 (2000) 35 30 %
25
20
15
10
5
0
0
5
10
15
20 %
1. Excluding banks (ISIC 651). 2. Excluding hotels and restaurants (ISIC 55), finance and insurance (ISIC 65 to 67) and other services (ISIC 80 to 93). 3. Excluding finance and insurance (ISIC 65 to 67). 4. Excluding financial intermediation (ISIC 65) for turnover. 5. Excluding finance and insurance (ISIC 65 to 67) and other services (ISIC 80 to 93). 6. Based on data by industry of sales. 7. Excluding real estate (ISIC 70). Source: OECD FATS Database, July 2004.
domestically based MNEs (i.e. parents with affiliates abroad). In turn, this requires two fundamental improvements in the data used to analyse the relative contribution of MNEs to productivity growth: • Firm-level micro-data that allow researchers to differentiate foreign affiliates operating in a country and parents of MNEs based in that country from unaffiliated (uni-national) domestic firms. This level of detail makes it possible to use various statistical techniques that otherwise cannot be applied. • Activities data that show the economic activity associated with MNEs, including value added, output, investment, employment and R&D.2 As compared to better-known data on FDI, which take a balance-of-payments approach and thus represent financial flows, activities data are more akin to structural business statistics and can be linked with other firm-level surveys. The growing access of researchers to firm-level micro-data on the activities of MNEs provides the basis for previously unattainable empirical insight into the relative contribution of MNEs to productivity growth. Such work brings analytical rigour to poorly understood, politicised subjects such as globalisation and new modes of production such as outsourcing, as well as to efforts to develop regional research areas. While the data and techniques used in recent research differ, limiting the degree to which the findings are comparable, the similarity of results supports the formation of some stylised facts that are important for understanding the role of MNEs in OECD economies. This recent empirical work3 provides insight in three areas: i) the impact of MNEs on productivity, broadly and relative to other forms of corporate organisation; ii) the role of MNEs in technology transfer, which in turn leads to productivity gains; and iii) the role of MNEs as a catalyst for enterprise dynamics (e.g. firm entry, exit, mergers, acquisitions) that generate improvements in productivity. Key conclusions of this work are summarised below. © OECD 2004
171
OECD Science, Technology and Industry Outlook 2004
Figure 6.4. Share of foreign affiliates in manufacturing R&D Percentage of total business R&D % 80 70 60 50 40 30 20 10
Ja pa n
Po lan d
Tu rk ey 2
Fr an ce Ne th er lan ds Un ite d St at es Fin lan d
Ge rm an y
Ki ng do m3
Ca na da
Un ite d
Sw ed en
Sp ain
Re pu bl ic 1 Po rtu ga l
Ire lan d
Cz ec h
Hu ng ar
y4
0
1. 2002. 2. 2000. 3. 1999. 4. 1997. Source: OECD AFA Database, July 2004.
Productivity Research that differentiates between the relative performance of MNEs and uni-national (or unaffiliated) domestic firms finds that MNEs outperform domestic firms in terms of productivity growth. These result hold even when taking into account a number of so-called fixed effects, such as age of the firm or the industry in which the firm operates. Recent research from the US Federal Reserve Board (Corrado et al., 2003), for example, broke down aggregate productivity growth over time by MNEs and non-MNEs, by form of organisation (e.g. corporate vs. non-corporate) and by sector. This technique made possible a breakdown of US productivity performance over the 1990s – a period of significant interest both because of the rise in (non-farm private business) average annual labour productivity growth (Table 6.1) and because other work has attributed a large portion of this increase to investments in information and communication technologies (ICTs) (Sichel and Oliner, 2000). The latter finding spurred interest in whether or not a new economy, driven by new technologies and new business models, was emerging in the United States (OECD, 2000, 2001b). This research, which compares MNEs in the United States (US parents and foreign affiliates in the United States) to wholly domestically oriented firms, confirms the importance of ICTs as well as the role of complementary factors such as firm organisation. The results indicate that the improvement in US productivity in the second half of the 1990s was not a phenomenon restricted to US firms and was not solely the result of small, innovative high-technology start-ups; in fact, both foreign affiliates and parents of US-based multinationals made important contributions to US productivity over the period. The research found that: 172
• MNEs account for about 30% of US non-farm private business gross product, a share that has remained relatively unchanged since 1977. This overall stability, however, masks the fact that the share for © OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
Table 6.1. Labour productivity growth of US non-farm private businesses, by sector Average annual rate of change (%)
Non-farm private business Non-financial corporations MNEs Parents Affiliates of foreign companies Domestically oriented Financial corporations Non-farm non-corporate businesses
1977-2000
1977-89
1989-95
1995-2000
1.6 1.5 3.2 3.3 2.5 0.7 1.2 1.6
1.0 1.1 2.6 2.8 1.0 0.4 –0.6 1.1
1.4 1.6 2.2 2.4 1.8 1.2 2.1 0.7
3.0 2.6 5.7 5.4 7.0 0.7 4.6 3.9
Source: Corrado et al. (2003).
US parents declined from 27% to 23% over the period, while the share of foreign affiliates increased from 4.7% to 6.4%. Furthermore, since 1997 the sectoral composition of MNE activity in the United States has shifted from manufacturing to services, particularly to wholesale and retail trade, and transportation, communication and public utilities services. 4 The share of gross product attributed to manufacturing declined from 60.5% to 48.5% of total MNE activity during this time period. • MNEs in the United States had consistently better labour productivity performance than aggregate non-farm private businesses. From 1995 to 2000, MNEs averaged 2.7 points higher labour productivity (Table 6.1). When compared to domestically oriented firms (non-farm, non-financial corporations), the difference is even more striking: productivity growth of MNEs outpaced that of unaffiliated firms by 5 percentage points during the second half of the 1990s. Affiliates of foreign firms saw average productivity growth of 7% a year over the second half of the 1990s – the best of any organisational form – more than three times higher than in previous periods (1977-89 and 1989-95). • MNEs accounted for nearly all of the pick-up in US non-financial corporate labour productivity in the late 1990s. When the aggregate, non-financial corporate productivity growth results are broken down into the shares attributable to different organisational forms and thus reflect their relative weights in the US economy, almost 90% is attributed to MNEs. US-based parents of MNEs accounted for more than two-thirds of this total. • ICT manufacturing and services account for most of the pick-up in MNE productivity growth between the early and late 1990s. Productivity growth rates for MNEs increased by 1.4 percentage points between the first and second half of the 1990s. MNEs engaged in manufacturing accounted for just less than half of this growth, and nearly all of the increase in manufacturing (0.5 of 0.6 percentage points) was due to the manufacture of ICT equipment (Table 6.2). This contribution was surpassed by that from MNEs whose primary activity was in non-manufacturing industries, which accounted for 0.8 of the 1.4 point increase in the average rate of MNE productivity growth between the early and late 1990s. Domestically oriented, uni-nationals, in contrast, saw their productivity growth rates decline from the first to the second half of the 1990s.5 Complementary work in the United Kingdom illustrates that these trends are not limited to the United States. Work comparing the relative productivity performance of three types of firms – US-owned affiliates operating in the United Kingdom, UK-owned MNEs, and foreign affiliates of firms headquartered in third countries – found that the performance of US affiliates operating in the United Kingdom was superior to that of UK-owned MNEs and to affiliates of all other foreign, non-US affiliates combined (Criscuolo and Martin, 2004). UK firms that were not part of an MNE came a distant fourth in © OECD 2004
173
OECD Science, Technology and Industry Outlook 2004
Table 6.2. Labour productivity growth in US non-financial corporations, by sector and industry Percentage points, annual rate 1977-2000
1977-89
1989-95
1995-2000
1.5
1.1
1.6
2.6
Non-financial corporations
Contributions to growth
MNEs Manufacturing IT equipment Other manufacturing Non-manufacturing Domestically oriented
1.2 0.8 0.5 0.4 0.4 0.4
0.9 0.6 0.4 0.3 0.2 0.3
0.8 0.7 0.4 0.3 0.1 0.8
2.2 1.3 0.9 0.5 0.9 0.5
Source: Corrado et al. (2003).
relative productivity growth. These findings hold even when controlling for capital intensity, material usage, industry, size and age effects. The UK analysis indicates that the superior productivity performance of US MNEs (as seen in the US study) was not simply a matter of home country advantage. Nor was it due to the ability of US parents to exert a positive influence on a foreign affiliate through shared assets emanating from the broader enterprise (e.g. R&D), or to inherent advantages of being global (e.g. cheaper options in hedging against exchange risks). The productivity performance of US MNEs was driven by a greater ability to acquire more productive plants. US firms acquired affiliates that were on average 10% more productive than affiliates acquired by other MNEs. Unanswered questions include whether or not the superior choices of US MNEs resulted from greater cash reserves and/or access to better financial markets which allowed them to out bid rivals for these affiliates. Other national analyses find further evidence that MNEs exert considerable influence on productivity growth and domestic employment. Work on Belgium (De Backer and Sleuwaegen, 2003) found that foreign affiliates operating in Belgium had marginally higher labour productivity than Belgian MNEs, and that both types of MNEs outperformed uni-national, Belgian firms by about 50% (Table 6.3). Possible reasons for the difference include better access of MNEs to technology, larger scale economies and overall greater efficiency. Research in Japan analysed the relative performance of Japanese-based MNEs (parents) in the manufacturing sector (Matsuura, 2003) versus other firms in Japan. This work confirmed that even after controlling for firm characteristics like firm age, R&D intensity, size and the industry in which the firm operates, MNEs achieved labour productivity levels that are 5% to 10% higher than those of firms that lack a foreign affiliate. Contrary to the belief that the MNE productivity premium may have been due to the outsourcing of jobs to
Table 6.3. Differences in labour productivity in Belgium by type of firm Millions of BEF per worker
1990 1991 1992 1993 1994 1995 174
Foreign subsidiaries
Belgian firms
Of which: Belgian MNEs
Belgian uni-nationals
2 350 2 246 2 464 2 374 2 628 2 707
1 739 1 643 1 742 1 696 1 793 1 808
2 230 2 205 2 245 1 978 2 314 2 527
1 608 1 628 1 654 1 646 1 701 1 741
Source: De Backer and Sleuwaegen (2003).
© OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
low-cost foreign affiliates, the study found that MNEs actually had a higher rate of employment increase at home than non-MNEs. Technology Technology is a key driver of productivity growth, and MNEs play a significant role in research and technology development. MNEs tend to be active in technology-intensive industries that require R&D to remain competitive, and they undertake R&D to tailor their products to local markets. Increasingly, firms have sought to undertake R&D abroad to tap into skilled human capital and to absorb research undertaken in the host country. As a result, MNEs are increasingly seen as conduits for the transfer of technology both into the host country and back to the home country. It is widely believed that MNEs make an indirect contribution to host country productivity growth through their production and use of technology that spills over to other businesses in the host country, stimulating their productivity. Previous empirical work has not successfully linked MNE spillovers to local productivity (Mohnen, 2001) perhaps because little is known about the nature and type of technology transferred or produced locally. More recent firm-level analysis sheds additional light on these phenomena. Firm-level analyses provides additional insight into the role of MNEs in technology diffusion. New studies indicate that successful technology transfer from foreign affiliates to other local firms requires careful attention to inter-firm linkages and cultural differences. A study using Belgian data,6 for example, found that foreign affiliates are indeed more likely to be active innovators and that nearly two-thirds cite international links as a crucial source of their innovation activities. Nevertheless, the researchers found that access to this channel did not necessarily result in a transfer or spillover of the technology obtained to other local firms. Rather, MNEs tried to limit this leakage through various strategies, including minimising the mobility of personnel by paying higher wages and engaging in FDI or alliances rather than licensing the technology to a local firm. While limited to Belgium and based on an early version of Europe’s Community Innovation Survey (CIS), this work suggests that policies that target MNEs in the hope of transferring technology to the local economy need to pay attention to co-operation between foreign subsidiaries and local firms and to capacity building in local firms, so that the country becomes more attractive in terms of exchange of technology and know-how. Other Belgian research (De Backer and Sleuwaegen, 2003) suggests that the greater the “cultural distance” between a foreign affiliate and its host country, the more likely the affiliate is to transfer technology from the parent to compensate for this disadvantage and make them competitive with local firms. This implies that firms from more distant countries would be most interesting to host countries because of the potential technology spillovers to domestic firms. Sectoral differences also come into play in determining technological spillovers from MNEs. Analysis based on micro-data (Keller and Yeaple, 2003) of the impact of technology spillovers from foreign affiliates on US productivity growth estimated that 14% of US productivity growth between 1987 and 1996 was attributable to technology spillovers emanating from foreign affiliates in the United States. While imports also generated positive technology spillovers, these were found to be weaker than those found for FDI. Not surprisingly, the analysis found that high-technology firms were more likely to generate spillovers than low-technology industries. The results are substantially higher than previous estimates and suggest that this activity is “… large enough to matter substantially in economic terms, that is for productivity growth and welfare” (Keller and Yeaple, 2003, p. 26). The main reason for the difference from previous work is the classification of foreign affiliates in the industries in which they operate in the United States, rather than according to the main activity of the parent enterprise. While the host country is expected to benefit from spillovers from MNEs conducting R&D on their soil, the MNE’s home country can also benefit when new ideas acquired and developed by foreign affiliates are repatriated. There has been less empirical work to date on this reverse flow, but recent firm-level research (Griffith et al., 2004) has looked at the impact of foreign affiliates of UK MNEs based in the United States on UK productivity. It concludes that UK MNEs whose affiliates in the United States were engaged in inventive activities (producing patents) prior to the upsurge in US R&D spending during the 1990s achieved superior productivity. The impact was most pronounced in those industries in which R&D grew faster in the United States than in the United Kingdom and in which the technology © OECD 2004
175
OECD Science, Technology and Industry Outlook 2004
gap between US and UK firms was largest. More generally, the study found that “… total factor productivity in British manufacturing would have been 5 per cent lower in the absence of the growth of US R&D stock in the 1990s” (Griffith et al., 2004, p. 4). From these results, the researchers draw the policy implication that the United Kingdom benefits from R&D labs established in the United States that act as listening posts for new ideas which are then transferred back to the United Kingdom and lead to productivity gains. This suggests that policies aimed at encouraging US-based foreign R&D activity to relocate back to the parent firm’s home country may be counterproductive and reduce the ability of domestic firms to benefit from foreign spillovers. Enterprise dynamics MNEs can also influence productivity growth by contributing to enterprise dynamics in the host country. Competition and the churning of businesses reward efficient firms and force out inefficient ones, boosting overall productivity. This can manifest itself in a number of ways, including through the creation of new firms (foreign affiliates), takeover of existing firms (mergers and acquisitions) and closure of inefficient firms. Previous OECD analysis has demonstrated that entry and exit of firms is an important driver of productivity growth, as new firms often use a more efficient mix of labour and capital than existing firms and obsolete firms exit industry sectors (OECD 2001b). Firm-level research focused on Canada (Baldwin and Gu, 2002) highlights the importance of MNEs in contributing to productivity growth in this way. A study of the contribution of enterprise dynamics to manufacturing labour productivity growth over three time periods (1973-79, 1979-88 and 1988-97) found the impact of plant entry and exit on productivity growth to be significant but decreasing over time: plant turnover contributed a quarter of productivity growth in 1973-79, 20% in 1979-88, and 15-20% in 1988-97. Breaking down the results by type of ownership revealed that almost all of the impact of plant turnover on productivity growth was due to the entry and exit of plants controlled by multi-plant firms (large firms). These multi-plant firms accounted for 85% of total Canadian productivity growth during the 1973-79 period and 90% of the growth in 1979-88 and 1988-97. Foreign-owned plants were particularly important. While accounting for a relatively small share of all plants (6% of entrants, 8% of exits), foreign-controlled plants accounted for 20% to 28% of employment and 40% of output associated
Figure 6.5. Relative productivity of foreign-controlled to domestically controlled plants Ratio of productivity of foreign-controlled to domestically controlled plants 1973-79
1979-88
1988-97
3.0
2.5
2.0
1.5
1.0
0.5
0 Entry
176
Exit
Continuing firms
Source: Baldwin and Gu (2002).
© OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
with plant turnover. As a consequence, foreign-controlled plants accounted for 60% of the contribution to productivity growth attributable to enterprise dynamics between 1988 and 1997. Moreover, their productivity increased relative to that of domestic entrants over the period (Figure 6.5). The productivity of foreign-owned plants was 1.6 times that of domestic entrants in the 1970s, a figure that had increased to 2.6 times by the 1990s. As a result, about 12%, or 0.35 percentage points, of the annual average growth in labour productivity was due to the opening and closing of plants by foreigncontrolled firms. These results indicate that while the overall impact of enterprise dynamics on Canadian labour productivity may have weakened, the decline is attributable to domestic plants. Entry and exit of foreign-controlled plants have exerted a growing influence on productivity growth over time. The authors attribute this effect to trade liberalisation adjustments that have been taking place over a quarter of a century and have led to the entry of foreign-controlled plants that are relatively more productive than both the previous cohort of foreign-controlled plants and domestically controlled plants. The entry of a MNE into a domestic economy can contribute to performance not only through its direct contribution to overall productivity gains, but also through indirect effects. The presence of a foreign affiliate, for example, can create business opportunities for other new entrants that supply the foreign affiliate, as well as for other new entrants that benefit from the overall increase in income and spending resulting from the affiliate. The additional supply can also lower prices in the final goods market, encouraging further domestic entry. Work on the Irish economy (Breathnach and Ströbl, 2003)suggests that the influx of foreign affiliates in Irish manufacturing has increased the population of domestic entrants by 30%. A 1% increase in the number of foreign affiliates increased total entry by 6.1%. These results may be influenced by the structure of the Irish economy, which did not contain significant domestic competition in many of the high-technology sectors that have attracted considerable foreign investment. If domestic competition had been higher, foreign entry could have displaced some domestic production. Nevertheless, the results provide some measure of the contribution of MNEs to domestic entry in emerging markets. Conclusions and implications Recent empirical work that makes use of firm-level data and data on the activities of MNEs underscores their importance to OECD economies. A few of the stylised facts that emerge include: • MNEs are important contributors to productivity growth. Both MNE parents based in a specific country and affiliates operating in host countries are responsible for a large and growing share of all productivity growth. Their contribution consistently outpaces that of uni-national or unaffiliated domestic firms. Nevertheless, the variance observed across countries in the impact of MNEs on productivity gains relative to those registered by domestic firms without any foreign affiliates is large because of different concepts of productivity, different time periods and different effects (e.g. impact of entry versus contribution of technology spillovers). • MNEs are important conduits for technology. Technological know-how can spill over to host countries, but such spillovers are far from automatic and their importance varies, depending on the nature of the firms involved and the sectors in which they operate. Spillovers can move in both directions, helping not only domestic firms that benefit from foreign affiliates, but also the foreign affiliates who absorb know-how from the host country and transfer it back to the home country of the parent. • MNEs contribute to productivity growth by stimulating enterprise dynamics. Through the creation of new businesses, the takeover of existing firms and the shutting down of companies, they contribute to competition and the winnowing out of inefficient and low-productivity firms. The importance of MNEs in this productivity-improving churning process appears to be growing over time. These results have clear implications for current issues confronting policy makers: concerns about the benefits of foreign affiliates accruing mostly to the parent country; outsourcing as the source of local © OECD 2004
177
OECD Science, Technology and Industry Outlook 2004
job losses and reductions in productivity; and the notion of attracting affiliates of MNEs operating aboard back home so as to build a regional research area. As illustrated, foreign affiliates can have a significant positive impact on their host countries. A large share of the US gain in productivity in the second half of the 1990s was attributable not to domestic US firms or US parents of MNEs but to foreign affiliates operating in the United States. Similarly, in Canada, foreign-controlled plants accounted for most of the productivity growth attributable to enterprise dynamics between 1988 and 1997. In Ireland they contributed to the creation of domestic firms. While R&D spillovers may not be automatic, as was the case in Belgium, close attention to patterns of co-operation and efforts to build local technological capacity can improve them. At the same time, foreign affiliates can generate benefits for their home countries, thereby compensating for some of the apparent disadvantages of outsourcing. Some of the current debate about outsourcing is fuelled by concerns that, unlike previous episodes in which outsourced work was low-wage or dangerous, the current phase is characterised by the transfer of professional work, such as software development, and of strategic activities like R&D. As recent analyses show, such outsourcing not only results in an outward movement of activity from the home country, but also generates benefits as knowledge from abroad flows into the home country. This is readily apparent from the work on the United Kingdom which highlights the benefits to the parent firm (and the UK economy) of their R&D affiliates abroad. In this sense, efforts to attract back or repatriate foreign affiliates, especially those seen as strategic (e.g. R&D laboratories) so as to bolster national or regional performance may not be an effective way to strengthen domestic economies. Foreign affiliates play an important role in acquiring and transmitting foreign knowledge that can be sent back to the parent enterprise and other affiliates in the group. By appropriating results of R&D conducted by others abroad, foreign affiliates may contribute more to
Box 6.1. Improving statistics on MNEs A problem inherent in efforts to understand the behaviour of MNEs is the fact that statistical agencies are nationally bound while MNEs operate in a number of countries. As a consequence, it is difficult to have a complete overview of an MNE’s operations. Potential solutions to this problem have been discussed at various international statistical meetings, such as the 2003 meeting of the Conference of European Statisticians in June 2003. At that meeting, proposals included the broader adoption of a US-style approach to measuring foreign affiliates, whereby inward as well as outward investments are measured and questions are asked about relationships between affiliates (vertical vs. horizontal links), intra-firm trade and the distribution of assets (Lynch and Clayton, 2003). While adopting this approach would certainly improve the overall level and quality of MNE data, it would be an expensive undertaking and confidentiality restrictions might limit the compilation of the micro-data, making it impossible to observe the worldwide affairs of an individual enterprise. Another proposal (Barnabe, 2003) concerns a pilot project in which a few MNEs would agree to have multiple national statistical offices send information to the national statistical office in which the MNE is headquartered. The experiment would allow statistical agencies to refine their data collection efforts to better match the realities of MNE accounting systems, and align their surveys on the information systems that these firms use. While potentially saving national statistical offices money, the system could also reduce the reporting burden on MNEs, although it would require willingness on their part to allow international sharing of confidential micro-data. A more modest but important step would be further harmonisation of existing data and methods and promoting the greater adoption of the activities approach to measuring multinational enterprises. Recent efforts by a working group under the auspices of the OECD in collaboration with Eurostat and other international organisations have resulted in the production of a handbook that provides guidance to compilers of statistics and recommends the creation of a common core set of reference indicators (see Handbook on Economic Globalisation Indicators, OECD, forthcoming). 178
© OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
national or regional performance than if they were located in their home country. Such affiliates are located abroad to tap into knowledge created in foreign centres of excellence. Breaking links to such centres may undermine MNEs’ overall innovation activities. A more effective strategy may be to build up local centres of excellence that can attract affiliates of foreign MNEs and encourage domestic firms to maintain a local R&D presence. The way to entice companies to invest in R&D in a particular region is to make the local area a strong supplier of knowledge or other critical resources.7 As with any new work, firm-level analysis of MNEs provides additional insight but raises many new questions. One area meriting further research is why the productivity performance of MNEs is superior to that of uni-national or unaffiliated firms. The evidence on the relevant factors is mixed and is not measured in a standard manner. Another issue concerns ownership – affiliates of US MNEs in the United Kingdom appear to perform better than the affiliates of firms from other countries. Is this true in other countries? If so, why? Furthermore, additional research is needed on the role of MNEs in the service sector. Much of the research to date looks exclusively at the manufacturing sector. Given the large share of services in all OECD economies, the productivity of service sector firms must increase if there is to be aggregate improvement. Lastly, there is growing interest in better understanding of the use of offshore outsourcing by MNEs as a means to improve their worldwide productivity. This requires an overall micro-level view of the firm which is difficult to achieve with current data. Additional efforts to improve firm-level statistics on MNEs will be needed to make progress in this area (Box 6.1).
179
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
NOTES 1. The OECD Workshop on Multinational Enterprises and Productivity Growth was held in Paris on 5 November 2003 and included contributions from researchers from Belgium, Canada, Japan, the Netherlands, Spain, the United Kingdom and the United States. 2. OECD working groups in co-operation with Eurostat have been engaged in developing MNE activity data since 1992 and have developed two databases, one for manufacturing and another for services that compile this type of data on a sectoral basis. 3. This chapter is largely based on the OECD Workshop mentioned in note 1. 4. From this base, labour productivity growth rates for non-financial corporations were calculated for the period1977-2000 and then broken down into sub-periods as well as by corporate status. 5. These findings confirm earlier work (Oliner and Sichel, 2001), which showed that ICT-producing sectors and service industries that made use of ICT were the main engines of productivity improvement in the United States during the 1990s. The new work reviewed here reveals that these gains were predominately achieved by MNEs. 6. This work linked MNE micro-data to results from the Community Innovation Survey. See Veugelers and Cassiman, 2002). 7. As Griffith et al. (2004) indicate, this phenomenon means that methods that aim to aggressively induce European firms to relocate their foreign R&D labs back in Europe so as to help achieve the target of 3% R&D intensity as set out in the Barcelona Objective could be counterproductive for improving economic performance.
180
© OECD 2004
Multinational Enterprises and Productivity Growth: Insight at the Firm Level
REFERENCES
Aitken, B. and A. Harrison (1999), “Do Domestic Firms Benefit from Foreign Investment? Evidence from Venezuela,”American Economic Review, 89, pp. 605-618. Baldwin, J. and W. Gu (2002), “Plant Turnover and Productivity Growth in Canadian Manufacturing”, STI Working Paper 2002/2, OECD, Paris, www.oecd.org/sti/working-papers. Barnabe, R. (2003), “Seeing the Whole Elephant: A Proposed Experiment on Measuring the Activities of Multinational Enterprises”, CES/2003/13. Available at: www.unece.org/stats/documents/2003.06.ces.htm. Breathnach, M. and E. Ströbl (2003), “Multinationals and Indigenous Plant Start-ups in Irish Manufacturing”, DSTI/EAS/IND/SWP/AH(2003)7. Corrado, C., P. Lengermann and L. Slifman (2003), “The Contribution of MNCs to US Productivity Growth”, DSTI/EAS/IND/SWP/AH(2003)2. Criscuolo, C. and R. Martin (2003), “Multinationals and US Productivity Leadership: Evidence from Great Britain”, STI Working Paper 2004/5, OECD, Paris, www.oecd.org/sti/working-papers. De Backer, K. and L. Sleuwaegen, “A Closer Look at the Productivity Advantage of Foreign Affiliates”, DSTI/EAS/IND/SWP/AH(2003)4. Griffith, R., R. Harrison and J. Van Reenen (2004), “How Special is the Special Relationship? Using the Impact of US R&D Spillovers on UK Firms as a Test of Technology Sourcing”, 9 May, mimeo. Keller W. and S. Yeaple (2003), “Multinational Enterprises, International Trade, and Productivity Growth: Firm-level Evidence from the United States”, NBER Working Paper 9504, www.nber.org/papers/w9504. Lynch, R. and T. Clayton (2003), “Globalisation – New Needs for Statistical Measurement”, CES/2003/17 forthcoming in Statistical Journal of the United Nations. Available at: www.unece.org/stats/documents/2003.06.ces.htm. Matsuura, T. (2003), “The Effects of FDI on Employment and Productivity: Evidence from Japanese Micro data”, DSTI/EAS/IND/SWP/AH(2003)6. Mohnen, P., (2001), “International R&D Spillovers and Economic Growth”, in M. Pohjola (ed.) Information Technology, Productivity and Economic Growth, Oxford University Press, Oxford. O’Rourke, K.H. and J.G. Williamson (2000), “When Did Globalization Begin”, National Bureau of Economic Research, Working Paper 7632, Cambridge, Massachusetts, April. Also available at www.nber.org/papers/w7632. OECD (2000), A New Economy? The Changing Role of Innovation and Information Technologies, OECD, Paris. OECD (2001a), Measuring Globalisation, Vols. 1 and 2, OECD, Paris. OECD (2001b), The New Economy: Beyond the Hype, OECD, Paris. OECD (2003), Science, Technology and Industry Scoreboard 2003, OECD, Paris. Oliner, S.D. and D.E. Sichel (2000), “The Resurgence of Growth in the Late 1990s: Is Information Technology the Story?”, Journal of Economic Perspectives, Fall, 14, pp. 3-22. Veugelers, R. and B. Cassiman (2002), “Foreign Subsidiaries as Channel of International Technology Diffusion: Some Direct Firm-level Evidence from Belgium”, CEPR Discussion Paper 2337, Revised version November, forthcoming in The European Economic Review.
© OECD 2004
181
Statistical Annex
MAIN OECD DATABASES USED Databases maintained by the Directorate for Science, Technology and Industry (DSTI)
Industrial structure and performance STAN: The database for Industrial Analysis includes annual measures of output, labour input, investment and international trade which allow users to construct a wide range of indicators focused on areas such as productivity growth, competitiveness and general structural change. The industry list provides sufficient details to enable users to highlight high-technology sectors and is compatible with those used in related OECD databases. STAN is primarily based on member countries’ annual National Accounts by activity tables and uses data from other sources, such as national industrial surveys/censuses, to estimate any missing detail. Since many of the data points in STAN are estimated, they do not represent the official member country submissions. The latest version of STAN is based on the International Standard Industrial Classification (ISIC) Rev. 3 and covers all activities (including services). Further details on STAN are available on the Internet at: www.oecd.org/sti/stan. Publication: STAN is available on line on SourceOECD (www.sourceoecd.org), updated on a “rolling” basis (i.e. new tables are posted as soon as they are ready) to maximise timeliness. In May 2004, a CDROM was published providing a snapshot of the STAN industrial database together with related databases covering R&D Expenditure and Bilateral Trade by industry (ANBERD and BTD) as well as a set of derived indicators (http://oecdpublications.gfi-nb.com/cgi-bin/ OECDBookShop.storefront/EN/product/922004063C3).
Science and technology R&D and TBP: The R&D database contains the full results of the OECD surveys on R&D expenditure and personnel from the 1960s. The TBP database presents information on the technology balance of payments. These databases serve, inter alia, as the raw material for both the ANBERD and MSTI databases. Publication: OECD (2004), Research and Development Statistics: 2003 Edition. Annual on CD-ROM (a printed edition is also available every two years). MSTI: The Main Science and Technology Indicators database provides a selection of the most frequently used annual data on the scientific and technological performance of OECD member countries and eight non-member economies (Argentina, China, Israel, Romania, Russian Federation, Singapore, Slovenia, Chinese Taipei). The indicators, expressed in the form of ratios, percentages, growth rates, cover resources devoted to R&D, patent families, technology balance of payments and international trade in highly R&D-intensive industries. Publication: OECD (2004), Main Science and Technology Indicators 2004/1. Biannual. Also available on CD-ROM. ANBERD: The Analytical Business Enterprise Research and Development database is an estimated database constructed with a view to creating a consistent data set that overcomes the problems of international comparability and time discontinuity associated with the official business enterprise R&D data provided to the OECD by its member countries. ANBERD contains R&D expenditures for the period 1987-2001, by industry (ISIC Rev. 3), for 19 OECD countries. Publication: OECD (forthcoming), Research and Development Expenditure in Industry, 1987-2002. Annual. Also available on line and on the CD-Rom STAN Structural Analysis databases (http://oecdpublications.gfi-nb.com/cgi-bin/ OECDBookShop.storefront/EN/product/922004063C3). Patent database: This database contains patents filed at the largest national patent offices – European Patent Office (EPO); US Patent and Trademark Office (USPTO); Japanese Patent Office (JPO) – and other national or regional offices. Each patent is referenced by: patent numbers and dates (publication, application and priority); names and countries of residence of the applicants and of the inventors; and technological categories, using the national patent classification as well as the International Patent Classification (IPC). The compiled indicators mainly refer to single patent counts in a selected patent office, as well as counts of “triadic” patent families (patents filed at the EPO, the USPTO and the JPO to protect a single invention). The series are published on a regular basis in OECD, Main Science and Technology Indicators.
© OECD 2004
183
OECD Science, Technology and Industry Outlook 2004
Globalisation and international trade AFA: The Activities of Foreign Affiliates database presents detailed data on the performance of foreign affiliates in the manufacturing industry of OECD countries (inward and outward investment). The data indicate the increasing importance of foreign affiliates in the economies of host countries, particularly in production, employment, value added, research and development, exports, wages and salaries. AFA contains 18 variables broken down by partner country and by industrial sector (based on ISIC Rev. 3) for 22 OECD countries. Publication: OECD, Measuring Globalisation: The Role of Multinationals in OECD Economies, 2001 Edition. Vol. I: Manufacturing. Biennial. Also available on line on SourceOECD (www.sourceoecd.org). FATS: This database gives detailed data on the activities of foreign affiliates in the service sector of OECD countries (inward and outward investment). The data indicate the increasing importance of foreign affiliates in the economies of host countries and of affiliates of national firms implanted abroad. FATS contains five variables (production, employment, value added, imports and exports) broken down by country of origin (inward investments) or implantation (outward investments) and by industrial sector (based on ISIC Rev. 3) for 19 OECD countries. Publication: OECD, Measuring Globalisation: The Role of Multinationals in OECD Economies, 2001 Edition. Vol. II: Services. Biennial. Soon available on line. Bilateral Trade (BTD): This database for industrial analysis includes detailed trade flows by manufacturing industry between a set of OECD declaring countries and a selection of partner countries and geographical regions. Data are presented in thousands of USD at current prices, and cover the period 1988-2001. The data have been derived from the OECD database International Trade by Commodities Statistics (ITCS – formerly Foreign Trade Statistics or FTS). Imports and exports are grouped according to the country of origin and the country of destination of the goods. The data have been converted from product classification schemes to an activity classification scheme based on ISIC Rev.3, that matches the classification currently used for the OECD’s STAN, Input-Output tables and ANBERD databases. Publication: OECD, Bilateral Trade Database, 2002. Also available on CD-ROM with STAN and ANBERD databases (http://oecdpublications.gfi-nb.com/cgi-bin/OECDBookShop.storefront/EN/product/922004063C3).
Information and communication technology (ICT) Telecommunications: This database is produced in association with the biennial Communications Outlook. It provides time-series data covering all OECD countries for the period 1980-2001. It contains both telecommunication and economic indicators. Publication: OECD (2003), Telecommunications Database 2003. Only available on diskette and CD-ROM. ICT: Work is under way to develop a database on ICT supply and ICT usage statistics. Statistics on employment, value added, production, wages and salaries, number of enterprises, R&D, imports and exports for the ICT sector are been collected following the OECD ICT sector definition based on ISIC Rev. 3. Publication: OECD (2002), Measuring the Information Economy, 2002. Freely available as a Web book with “clickable” access to the data used in charts and figures at: www.oecd.org/sti/measuring-infoeconomy.
184
© OECD 2004
Statistical Annex
Current country coverage of main DSTI databases used in this publication Industry
Australia Austria Belgium Canada Czech Republic Denmark Finland France Germany Greece Hungary Iceland Ireland Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland Portugal Slovak Republic Spain Sweden Switzerland Turkey United Kingdom United States
Science and technology
STAN
R&D
TBP
MSTI
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓
✓ ✓
Globalisation
ANBERD
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Patents
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
ICT
AFA
FATS
BTD
✓
✓ ✓ ✓
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
✓ ✓
✓
✓ ✓ ✓ ✓ ✓
✓ ✓ ✓ ✓ ✓
✓ ✓ ✓
✓ ✓ ✓
✓ ✓ ✓
✓
✓ ✓ ✓ ✓ ✓ ✓
✓ ✓ ✓
✓ ✓ ✓
✓ ✓ ✓
✓
✓
Telecom.
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Other OECD databases ADB: Analytical DataBase (Economics Department). ANA: Annual National Accounts (Statistics Directorate). Education database (Directorate for Education). ITCS: International Trade in Commodities Statistics (Statistics Directorate). International Direct Investment (Directorate for Financial, Fiscal and Enterprise Affairs). LFS: Labour Force Statistics (Statistics Directorate). SSIS: Structural Statistics for Industry and Services (Statistics Directorate). Services: Value Added and Employment (Statistics Directorate). Further details on OECD statistics are available on the Internet at: www.oecd.org/statistics/.
185
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
STANDARD STATISTICAL NOTES USED IN THIS PUBLICATION FOR SCIENCE AND TECHNOLOGY INDICATORS a) b) c) d) e) f) g)
Break in series with previous year. Estimate. Defence excluded (all or mostly). Including R&D in the social sciences and humanities. Excluding R&D in the social sciences and humanities. Federal or central government only. Excludes data for the R&D content of general payment to the higher education sector for combined education and research. h) Excludes most or all capital expenditure. i) Total intramural R&D expenditure instead of current intramural R&D expenditure. j) Overestimated or based on overestimated data. k) Underestimated or based on underestimated data. l) Included elsewhere. m) Includes other classes. n) Provisional. o) At current exchange rate and not at current purchasing power parities. p) Unrevised breakdown not adding to the revised total. q) Does not correspond exactly to the OECD recommendations. r) Including extramural R&D expenditure.
186
© OECD 2004
STANDARD INDUSTRY AGGREGATION BY TECHNOLOGY LEVEL (based on ISIC Revision3)
The high-technology industries (HT) are defined as the sum of: • Pharmaceuticals (2423), • Office and computing machinery (30), • Radio, TV and communication equipment (32), • Medical, precision and optical equipment (33), • Aircraft and spacecraft (353). The medium-high-technology industries (MHT) are defined as the sum of: • Chemicals excluding pharmaceuticals (24 excl. 2423), • Machinery and equipment (29), • Electrical machinery and apparatus (31), • Motor vehicles and trailers (34), • Railroad and transport equipment (352+359). The medium-low-technology industries (MLT) are defined as the sum of: • Coke, refined petroleum products and nuclear fuel (23), • Rubber and plastic products (25), • Other non-metallic mineral products (26), • Basic metals (27), • Fabricated metal products except machinery and equipment (28), • Building and repairing of ships and boats (351). The low-technology industries (LT) are defined as the sum of: • Food products, beverages and tobacco (15-16), • Textiles, textile products, leather and footwear (17-19), • Wood, pulp, paper, paper products, printing and publishing (20-22), • Manufacturing n.e.c. and recycling (36-37).
187
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
ANNEX TABLES
Table 1. Breakdown of GDP per capita into its components, 1990-2003 United States = 100 Effect of labour force participation (%) GDP per capita (US=100)
Total effect
(1)
Working-age population1 to total population
(2)
(3)
Unemployment
(4)
1990
2003
1990
2003
1990
2003
Australia
73
78
-1
1
-10
Austria
82
79
-
-
-10
Belgium
78
76
-26
-30
Canada
83
83
-3
Czech Republic
48
43
1
Denmark
79
80
-11
2
Labour force to working-age population
Working hours
(5)
GDP per person employed (US=100)
(6)
1990
2003
1990
2003
1990
-10
9
11
-1
0
-9
14
14
1
0
-10
-12
-6
1
-1
3
-12
-10
14
15
2
-7
-3
7
3
-14
-10
-12
17
16
GDP per hour worked (US=100)
(7)
(8)=(1)-(2)
2003
1990
2003
1990
2003
1
1
75
77
73
77
-
-13
77
74
-
87
-2
-9
-17
95
89
104
106
-2
-1
-2
-2
83
79
86
81
1
-1
-
3
47
44
-
41
-1
0
-17
-19
73
75
90
93
Finland
78
73
-1
-9
-10
-10
12
9
2
-2
-5
-6
74
77
79
82
France
79
77
-25
-30
-12
-13
0
5
-3
-3
-10
-19
94
88
104
106
Germany
96
70
-14
-19
-9
-9
8
10
1
-2
-14
-18
95
72
110
90
Greece
49
54
-12
-10
-9
-10
-5
-1
-1
-2
3
4
64
67
61
63
Hungary3
35
39
-3
-9
-5
-4
1
-5
1
0
-
-
38
48
-
-
Iceland
87
80
10
12
-15
-12
23
21
3
2
0
0
77
69
77
68
Ireland
56
90
-21
-13
-13
-11
-5
5
-6
1
4
-8
80
94
77
102
Italy
75
70
-31
-29
-9
-9
-9
-6
-4
-3
-9
-12
97
88
106
100
Japan
81
74
12
3
-7
-8
9
12
3
0
7
0
76
71
69
71
Korea
32
47
-4
-1
-3
-3
-2
1
1
1
-
-
36
48
-
-
Luxembourg
108
137
-14
-13
-10
-18
-9
2
6
4
-
-
122
150
-
-
Mexico
27
26
-47
-35
-32
-27
-17
-10
2
2
-
1
74
61
-
60
Netherlands
77
80
-46
-37
-8
-9
-12
1
0
3
-26
-31
97
86
123
117
New Zealand
60
62
-7
1
-2
0
-3
0
-2
1
-1
0
66
61
67
61
Norway
78
96
-21
-27
-13
-16
13
20
0
1
-22
-32
77
92
99
123
Poland
26
31
-4
-7
-4
-2
-
-2
-
-6
-
3
-
41
-
38
Portugal
46
49
-2
-3
-7
-6
4
7
0
0
1
-4
49
48
48
53
Slovak Republic4
28
35
-5
-6
-4
-3
1
2
-3
-5
-
0
33
41
-
41
2
Spain
57
62
-24
-10
-9
-8
-10
3
-5
-4
0
0
81
72
81
72
Sweden
81
75
-6
-13
-14
-13
19
12
3
1
-14
-13
74
75
87
88
Switzerland
107
82
8
3
-11
-10
27
23
5
1
-12
-11
86
68
98
80
Turkey
20
18
-8
-10
-5
-3
-2
-6
-1
-1
-
-
28
29
-
-
United Kingdom
71
78
-4
-5
-11
-12
11
12
0
1
-3
-6
72
77
75
83
United States
100
100
0
0
0
0
0
0
0
0
0
0
100
100
100
100
Total OECD
69
81
-28
-9
-10
2
-3
2
1
-1
-17
-13
81
77
97
90
EU-254
65
69
-11
-4
-9
-6
1
4
-4
-2
-
-
76
73
-
-
EU-15
76
75
-20
-15
-10
-7
1
6
-1
-2
-10
-12
86
78
96
90
1. 15-64 years.
2. 2002 instead of 2003.
3. 1991 instead of 1990.
4. 1994 instead of 1990.
Source: OECD, GDP from National Accounts database; other data from OECD Economic Outlook 75, 2004. Complementary estimates for hours worked from OECD Employment Outlook , 2004.
StatLink: http://dx.doi.org/10.1787/515628628843
188
© OECD 2004
Statistical Annex
Table 2. Income and productivity levels in the OECD, 1950-2002 GDP per capita (US=100) 1950
1973
1980
1990
2000
GDP per hour worked (US=100) 2003
1950
1973
1980
1990
2000
2003
Australia1
77
76
75
73
74
78
72
69
72
73
77
77
Austria
42
73
81
82
79
79
-
-
-
-
90
87
Belgium
60
76
81
78
73
76
59
85
102
104
108
106
Canada
81
86
91
83
80
83
85
86
88
86
84
81
Czech Republic
50
57
58
48
39
43
-
-
-
-
37
41
Denmark
80
91
87
79
79
80
60
81
89
90
95
93
Finland
46
69
74
78
72
73
35
60
64
79
84
82
France
55
78
82
79
73
77
46
77
88
104
103
106
Germany
42
74
78
96
70
70
39
76
88
110
92
90
Greece
24
56
57
49
47
54
-
-
-
61
60
63
39
51
43
35
33
39
-
-
-
-
-
-
Iceland
-
72
87
87
79
80
-
59
74
77
69
68
Ireland
38
43
49
56
79
90
-
46
58
77
96
102
Italy
41
70
78
75
70
70
43
83
97
106
108
100
Japan
20
67
71
81
73
-
15
47
55
69
72
72
Korea
9
15
20
32
43
47
7
10
16
-
-
-
2
Hungary
-
98
92
108
137
137
-
-
-
-
-
-
Mexico
Luxembourg
27
31
35
27
26
26
31
42
-
-
63
60
Netherlands
67
83
84
77
76
-
59
92
106
123
116
117
New Zealand
94
79
68
60
58
62
-
81
71
67
63
61
Norway
63
74
91
78
101
96
57
79
101
99
133
123
Poland
29
36
35
26
29
31
-
-
-
-
35
38
Portugal
22
44
43
46
48
49
19
40
-
48
53
53
Slovak Republic
38
43
44
-
30
35
-
-
-
-
35
41
Spain
28
57
56
57
57
62
25
56
69
81
75
72
Sweden
69
78
78
81
75
75
58
79
83
87
90
88
100
114
106
107
84
82
86
96
101
98
86
80
Switzerland Turkey
15
17
17
20
19
18
-
-
-
-
-
-
United Kingdom
72
72
69
71
71
78
61
64
70
75
81
83
100
100
100
100
100
100
100
100
100
100
100
100
United States
1. 2002 instead of 2003. 2. 1991 instead of 1990.
Source : Previous annex; OECD Science, Technology and Industry Scoreboard, 2003. StatLink: http://dx.doi.org/10.1787/482201516226
189
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 3. Gross R&D expenditures, 1981-2003 Millions constant USD (1995 PPPs)
1981
1991
1995
Australia1, 2
2 362
5 141
Austria
1 457
2 488
b
3 350
b
Belgium3
2 605
Canada
5 843
Czech Republic
a
-
2 324
945
1 773
Finland
904
a
1 938
France
17 870
a
27 961
Germany
27 895
41 987
Greece4
205
Hungary
-
981
29
68
Iceland Ireland
a
7 914
c,q
2 821
a
a
c,q
2001
7 107 b
3 855
2002
b
4 019
4 098
3 762
5 110
5 488
-
15 373
16 529
16 072
1 257
a
2003
b,n
11 250
2 159
484
b,n
4 131
16 065
1 760
1 771
1 800
-
3 272
3 471
-
2 218
4 162
4 221
4 374
28 461
30 646
a
31 994
31 923
n
-
47 838
b
48 518
48 934
b
48 426
39 412
b
671
a
1 056
684
c
908
c
207
b
237
1 184
b
93 b
487
822
r
13 880
a
11 892
b,j
74 412
b,j
75 659
b,j
90 184
e
12 919
e
17 374
13 975
1 106
-
1 116
c
1 249
c
-
238
b
-
1 253 14 830 93 007
-
-
-
-
94 172
-
38 752
Korea
-
7 563
Luxembourg
-
-
-
318
-
-
-
Mexico
-
-
1 935
3 037
3 194
-
-
4 304
6 076
6 650
7 649
7 670
-
-
-
524
605
712
873
937
1 512
1 765
a
2 055
2 296
2 358
-
-
1 881
a
2 407
2 244
271
780
751
1 371
1 512
b
326
k
Netherlands New Zealand4 Norway4 Poland Portugal5, 1 Slovak Republic Spain Sweden4
-
868
1 754
4 944
b,c,q
405
c
5 010
b
340
k
6 998
20 858
a
-
k
7 314
b
-
8 090
-
4 883
3 233
4 739 1 538
1 284
2 627
-
-
-
19 201
a
21 673
22 498
24 816
25 530
26 207
-
United States
114 530
h
176 578
h
184 079
h
243 271
h
246 187
h
245 430
h,n
248 064
Total OECD
254 691
b
414 522
a,b
438 558
a,b
553 399
b
569 275
b
574 708
b,n
-
138 328
b
166 859
b
172 704
b
175 929
b,n
-
160 547
b
166 123
b
169 525
b,n
-
Switzerland Turkey
United Kingdom
-
EU-25
-
EU-15
88 551
China
-
4 971
b
132 558
a,b
13 824
k c
Israel
-
1 937
Russian Federation
-
23 032
9 503
5 255
133 421
-
18 022
k
45 002
a
52 399
2 630
c
5 613
c
5 937
7 475
10 537
k
-
b
7 715
k
e
a,k
6 294
a,k
346
e
3 234 1, 2
k
2 472 1 279
19 721
-
-
-
-
65 485 c,n
12 277
5 516 13 651
b
-
Japan
e
b,n
-
b
b
b,n
n
2 854
b
251
Italy
6 570
9 373
Denmark4
2000
b,h,n
c,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability:
190
1. 1992 instead of 1991.
3. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1999 instead of 2000.
Source: OECD, MSTI database, May 2004.
5. 1982 instead of 1981.
StatLink: http://dx.doi.org/10.1787/367403882784
© OECD 2004
Statistical Annex
Table 4. GERD intensity, 1981-2003 As a percentage of GDP
1981
1991
1995
Australia1, 2
0.94
1.52
Austria
1.13
1.47
b
1.62
b
Belgium
3
1.56
Canada
a
1.24
Czech Republic
-
2.02
1.06
1.64
Finland
1.18
a
2.04
France
1.93
a
2.37
Germany
2.43
2.52
4
0.17
Hungary
-
1.06
0.64
1.17
Greece
Iceland
1.66
1.60
Denmark4
a
2000
c,q
1.56
1.54 a,b
a
0.36 c,q
1.86
2.17
1.91
1.01
1.30
1.30
-
2.52
-
3.40
3.41
3.46
2.18
a
2.23
2.20
n
-
2.49
b
2.51
2.52
b
2.50
2.25
b
0.49
a
0.67
0.73
a,c
0.80
c
2.75
b
3.06
1.15
b
1.57 1.28
b
a
1.00
Japan
2.12
j
2.76
j
2.69
j
2.99
e
2.50
e
2.65
Korea
-
1.92
Luxembourg
-
-
-
Mexico
-
-
0.31
Slovak Republic Spain Sweden4 1, 2
Switzerland Turkey
1.79
1.97
1.99
-
0.98
0.96
1.18
1.64
1.70
-
-
-
2.13
0.41
0.84
c,q
a
-
0.95
c
1.02
c
-
3.09
b
-
1.11 3.07 e
2.92
-
-
-
-
3.12 e
2.91
e
-
-
-
-
0.37
0.39
-
-
-
-
1.90
1.89
1.02
1.18
a
1.65
0.65
a
0.66
0.57
a
0.93
a
-
-
1.60
1.67
-
0.64
0.59
b
-
0.80
b
0.85
0.93
b
-
c
0.65
k
0.64
0.58
k
0.81
a
0.94
3.35
a,k
3.65
a,k
2.72
2.12
b
2.59
2.67
2.57
k
0.95 k
4.27
1.03 k
-
-
-
-
-
-
0.53
0.38
0.64
-
-
-
United Kingdom
2.38
a
2.07
1.95
1.84
1.86
1.88
-
United States
2.34
h
2.72
h
2.51
h
2.72
h
2.74
h
2.67
h,n
2.62
Total OECD
1.93
b
2.22
a,b
2.09
a,b
2.24
b
2.28
b
2.26
b,n
-
1.72
b
1.80
b
1.83
b
1.83
b,n
-
1.88
b
1.92
b
1.93
b,n
-
EU-25
-
EU-15
1.67
China
-
b
1.90
a,b
1.80
0.74
k
0.60
k
1.00
a
1.07
c
2.74
c
4.72
c
5.04
Israel
-
2.50
Russian Federation
-
1.43
0.85
1.05
1.16
1.23 c,n
4.72
b
-
1.71
2.22
-
k
1.07
0.65
1.15
b,n
-
b
b
b,n
-
2.28
0.93
0.61
1.87
2.31
b
0.30
n
2.40
1.23
Portugal
1.94
1.33
r
5, 1
b,n
2.19
0.88
Poland
1.93
2.03
a
2003
b,n
2.04
Italy
Norway4
1.92
1.92
0.68
New Zealand4
b
1.72
Ireland
Netherlands
2002
1.72
1.84 a
2001
b,h,n
c,n
1.24
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1999 instead of 2000.
Source: OECD, MSTI database, May 2004.
© OECD 2004
5. 1982 instead of 1981.
StatLink: http://dx.doi.org/10.1787/036108151783
191
OECD Science, Technology and Industry Outlook 2004
Table 5. GERD by source of funds, 1981-2003 As a percentage of total national R&D expenditures Business enterprise 1981 Australia1, 2, 3 Austria
20.2
1991 p
50.2
1995
44.0
2001
47.8
50.3
b
64.8
b
45.3
b
Government 2002
46.3
-
39.9
b,n
40.3
Belgium4
64.8
67.1
64.3
-
Canada
40.8
38.2
45.7
48.3
45.3
-
-
63.1
52.5
53.7
45.2
61.5
-
Czech Republic
a
42.5
a
Finland
54.5
a
56.3
France
40.9
a
42.5
Denmark
Germany Greece
56.9 21.4
Hungary
51.4
61.7 a
a
59.5 48.4
a
21.8 c,q,s
s
70.8
69.5
54.2
-
60.0
b
25.5
a
29.7
b
38.4
c,s
34.8
c,s
65.7
65.6
-
53.5
65.1
b
39.7
43.4
a
53.4
a
41.8
40.9 48.8 35.9
a
a
53.6
c,s
a
53.0
-
24.9
16.4
k
20.9
-
-
-
-
-
-
Japan
67.7
77.4
Korea
-
-
76.3
72.5
e
72.2
Luxembourg3
-
-
-
91.0
-
73.9 e
34.0
34.0
b
32.1
-
b
-
-
b,p
22.6
k
18.5
b
18.2
b
19.0
25.0
e
25.4
e
-
-
7.7
-
-
-
-
-
-
-
17.6
29.8
-
-
-
-
66.2
59.1
-
46.3
47.8
46.0
51.8
-
-
47.2
48.6
42.2
36.2
-
-
-
27.4
33.7
37.1
-
-
-
61.8
52.3
46.4
-
-
Norway
40.1
44.5
49.9
a
51.7
-
-
57.2
49.5
44.0
a
39.8
-
-
Poland
-
-
36.0
a
30.8
31.0
-
-
-
60.2
a
64.8
61.1
-
30.0
20.2
19.5
31.5
-
-
61.9
59.4
65.3
a
61.0
-
-
-
68.3
-
-
31.7
37.8
c
41.3
44.1
-
Spain
42.8
48.1
44.5
48.9
-
56.0
45.7
43.6
a
39.9
39.1
-
Sweden
54.9
a
61.9
65.5
-
-
42.3
a
34.0
28.8
a
-
-
75.1
b
b
28.4
26.9
23.2
-
-
-
70.1
62.4
50.6
-
-
-
32.8
28.5
26.9
-
Netherlands New Zealand
Portugal5, 1 Slovak Republic
Switzerland1, 2, 3 Turkey3
-
c,q
60.4
c
56.1
a
j
47.2 a
71.9
67.4
67.5
69.1
-
28.5
32.9
42.9
-
48.2
47.3
53.6
j
-
24.9
-
-
-
46.7
-
48.1
a,b
35.0
47.8
h
38.9
h
35.4
h
27.8
h
30.2
h,n
44.1
b
35.7
a,b
34.0
a,b
28.9
b
29.9
b,n
39.4
b
34.7
b
-
-
34.1
b
-
-
33.4
s
-
-
24.7
c
-
-
58.4
-
42.1
a
49.6
United States
49.4
h
57.2
h
60.2
h
67.3
h
64.4
h,n
63.1
Total OECD
51.7
b
58.7
a,b
59.4
a,b
63.6
b
62.3
b,n
-
51.9
b
55.4
b
-
-
-
56.0
b
-
-
46.7
57.6
s
-
-
-
-
69.6
c,n
-
-
-
36.9
33.1
-
-
-
-
-
EU-15
48.7
China3
-
-
Israel3
-
43.5
Russian Federation
-
-
b
52.0
a,b
52.2
c
47.7
c
33.6
33.6
21.0
-
United Kingdom
EU-25
c,q
a
h,n
b
41.1
a,b
39.1
c
35.9
-
61.5
c
57.2
b
c,s
-
-
b,n
-
58.6
b,n
-
-
-
46.9
49.6
b,n
-
31.5
c,s
k
40.4
-
31.4
53.1
r
b,n
26.1
36.9
53.9
47.2
41.7
j
s
b
-
a
-
42.1
a
57.3
2003
-
b
-
44.4
33.3
37.9
22.5
j
b
30.5
25.5
b
r
40.9
35.1
27.9
50.1
b,n
28.0
56.5
c,q,s
41.1
39.6
-
Italy
57.7
-
21.4 b
41.9 a
2002
45.7
43.6
-
c,s
b
32.3
69.7
72.3
Mexico
-
85.6
b
73.0
-
-
60.6
72.3
-
-
37.7
-
35.9
b
40.0
Ireland3
j
23.1
31.3
-
24.5
b
47.3
78.6
5.7
66.0
46.5
45.7
33.4 n
a
2001
45.8 b
50.6
44.3
b
46.9
50.2 b
n
p
1995
-
Iceland
b,p
40.8
72.8 b,n
1991
-
56.0
46.2
1981
b,n
29.7
-
34.6
2003
31.2
h,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
2. 1996 instead of 1995.
4. 1983 instead of 1981.
Source: OECD, MSTI database, May 2004.
5. 1982 instead of 1981.
StatLink: http://dx.doi.org/10.1787/442056514762
192
© OECD 2004
Statistical Annex
Table 5. GERD by source of funds, 1981-2003 (cont'd) As a percentage of total national R&D expenditures Other national sources 1981 Australia1, 2, 3
2.1
Austria
0.4
Belgium4
0.8
Canada
4.8
Czech Republic
1991 p
a
3.9
2001
4.4
0.3
b
0.4
1.0
b
2.3
6.7
b
6.9
b
-
0.3
b,n
2.5 b
8.4
-
1.3
1.7
2.0
a
4.6
4.3
2.6
Finland
1.1
a
1.5
1.0
France
0.7
a
0.7
0.4
0.5
Greece
-
0.7
Hungary
-
0.1
Iceland
4.4
1.7
Ireland3
1.1
2.2
Italy
0.0
r
Japan
7.3
b,k
a
1.7 a
c,q,s
b
6.1
b,n
10.0
1.0 b,n
a
3.8
1.8
2.1
3.3
3.0
b
7.5
11.8
-
11.6
12.9
12.0
18.7
-
3.3
2.2
11.0
7.8
1.2
1.2
-
1.0
a
4.5
2.5
1.7
-
5.0
a
2.0
c,s
0.4
c,s
0.4
0.4
1.6 2.6
b
b e
4.7
2.1
Luxembourg3
-
-
-
-
-
-
-
9.5
9.8
1.8
2.6
1.1
a
9.9
a
1.0 -
19.9
-
1.8
-
-
4.3
4.1
-
-
4.8
-
2.7
r b,k
a
8.0 2.0
-
c,s
8.0 a
c,q,s
1.8
b
18.2
a
4.9
c,s
4.4
9.4
b
8.5
6.1
a
5.3
0.1
b,k
0.1
c,s
8.9 -
b,k
b
10.4
-
-
0.1
2.0
-
-
-
0.0
0.5
e
0.4
-
-
-
-
1.3
-
-
0.4
e
-
-
-
-
-
6.7
1.3
-
-
-
-
5.2
1.9
9.3
11.0
-
-
-
-
8.2
10.1
-
-
-
2.5
3.9
1.4
1.3
1.2
a
1.4
-
-
1.4
4.6
4.9
a
7.1
-
-
Poland
-
-
2.1
a
2.0
3.2
-
-
-
1.7
a
2.4
4.8
-
4.8
5.4
3.3
-
3.3
15.0
11.9
a
5.1
c
Portugal5, 1 Slovak Republic
-
2.4
-
0.1
c
0.8
Spain
0.1
l
0.6
5.2
a
5.3
Sweden
1.4
a
2.7
2.2
a
3.8
Switzerland1, 2, 3
-
Turkey3
2.3
-
2.5
j
3.4
-
0.3
j
-
-
-
1.6
5.2
-
1.1
5.6
6.7
-
-
1.5
1.5
3.4
-
-
-
1.9
3.1
1.3
2.7
5.3
United Kingdom
3.0
a
3.5
4.5
5.8
United States
2.8
h
3.9
h
4.4
h
5.0
h
5.4
h,n
Total OECD
2.9
b
3.5
a,b
4.0
a,b
4.6
b
4.8
b,n
-
-
-
-
1.9
b
2.2
b
-
-
-
-
6.7
1.8
b
2.2
b
-
-
3.5
-
-
-
-
c
2.8
-
-
-
6.5
0.4
-
-
-
EU-25
-
-
EU-15
1.1
China3
-
-
Israel3
-
13.1
Russian Federation
-
-
b
1.3
a,b
c
12.0
-
0.3
0.5
c,n
-
-
-
5.9
-
6.9
a
5.7
h,n
a
-
b
6.6
a
-
Norway
New Zealand
1.9
j
7.7 a
4.9
b
2.1
j
6.8
3.4 4.3
-
-
-
-
-
-
0.2
2.0
1.2
-
-
11.9
14.5
18.4
20.5
-
-
-
-
-
-
5.6
a,b
6.9
c
4.4
b
-
4.6
c
-
-
7.6
b
-
-
7.8
b
-
-
2.7
s
-
-
2.8
c,n
-
-
8.0
-
8.6
b
c,s
-
e
0.4
2.4
-
b
n
-
b
11.7
-
-
9.2
n
-
2.5
b,n
-
3.1
2.5 b
18.5
-
7.2
21.4
b,n
2.7 s
18.3 b,p
18.5
7.6
-
1.3
0.4
b
-
0.3
-
8.1
-
-
1.3
b,n
2003
-
7.1
4.4
b
-
b
9.4
b
2002
3.0
-
-
Mexico
-
p
2.5
2.1
Korea
Netherlands
1.0 b,n
2001
-
0.5
b,k
9.4
0.3
1995
-
2.5
6.7
b,n
1991
-
b
b,p
0.3
1981
1.5 s
a
b,k
b
0.3
1.9
2003
-
b
3.7
Abroad 2002
4.8
Denmark
Germany
-
1995
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
2. 1996 instead of 1995.
4. 1983 instead of 1981.
5. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
193
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 6. GERD by two main sources of funds, as a percentage of GDP, 1981-2003 Industry 1981
1991
1995
Government
2001
2002
2003
1981
1991
Australia 1, 2, 3
0.19
Austria
0.57
Belgium 4
1.01
Canada
0.51
0.61
0.79
0.98
0.86
-
-
0.64
0.68
0.70
0.84
0.83
1.48
-
-
0.57
1.15
1.36
2.41
2.40
-
0.51
a
1.12
1.21
-
1.03
a
Czech Republic Denmark
0.45
Finland
0.64
France
0.79
Germany
p
a
a
0.70
1.05
b
1.15
1.55
0.04
0.08
-
0.59
Iceland
0.04
0.29
Ireland3
0.26
Hungary
0.79 b
1.01
1.38
Greece
0.67 0.74
Italy
0.44
r
Japan
1.44
j
a
m,q,s
a,b
0.71
-
0.77
b,n
1.40
1.35 0.12
0.19
0.28
a,s
0.33
0.54
0.56
b
0.54
a
0.42
2.14
j
1.95
0.92
s
1.66
0.76
b
j
Korea
-
-
1.91
2.12
Luxembourg 3
-
-
-
1.56
-
Mexico
-
0.10
0.05
0.12
0.83
0.94
Netherlands New Zealand Norway
-
0.27
0.32
0.47
0.73
0.85
-
-
0.23
Poland Portugal
5, 1
0.09
0.12
-
1.46
Slovak Republic Spain
0.18
Sweden 1, 2, 3
0.91
0.11 q
0.40
1.22
a,k
1.59
b
1.69
k
a
a
0.56
0.83
b
1.63
b
0.40
0.63
0.73
b
0.62
b
0.62
-
0.59
c,k,q
0.33
c,k,q
0.57
1.01
-
-
0.54
0.82
-
-
0.38
-
0.42
r
-
0.53
b
0.26
b
0.29
0.61
a
0.53
0.45
b
0.56
1.04 b,p
0.26 -
b
-
-
-
-
-
0.84
-
-
-
0.61
0.50
0.55
0.83
-
-
0.67
0.81
0.75
0.20
0.18
-
-
-
0.39
0.18
0.36
0.36
0.31
-
-
0.68
0.36
a
0.45
2.20
k
3.07
k
-
0.36
0.37
0.52
-
0.35
c
0.26
0.35
a
0.38
0.96
a,k
0.90
k
0.25
b
-
k
-
0.93
-
0.53
0.74
0.72
-
-
-
0.37
0.88
-
1.15
a,b
0.72
1.12
h
1.06
h
0.89
h
0.76
h
0.81
h,n
0.82
0.85
b
0.79
a,b
0.71
a,b
0.66
b
0.68
b,n
-
0.68
b
0.63
b
-
-
0.65
b
-
-
0.33
s
-
-
1.17
c
-
-
0.73
-
h,n
1.65
Total OECD
1.00
b
1.30
a,b
1.24
a,b
1.45
b
1.41
b,n
-
0.89
b
1.01
b
-
-
-
0.94
1.07
b
-
-
0.78
-
0.58
s
-
-
-
n
0.39
0.41
a
b
1.72
0.29
a
a,k
h
-
-
0.94
1.85
-
-
-
h
3.29
-
0.64
-
1.51
1.31
-
0.23
h
1.09
a
-
1.56
b,h,n
0.38
0.68
0.50
h
-
c,q
-
-
0.95
-
-
-
0.84
-
-
-
-
k
b
0.78
a,b
-
-
-
-
0.92
0.41
-
-
-
0.40
-
k
-
-
0.60
-
-
-
0.24
0.32
-
-
-
0.64
0.53
0.50
-
0.70 -
c
0.98 0.52
c
0.67
b
c,s
e
-
0.27
0.80
0.74
0.23
b,n
b
b
0.20
b
-
0.57
0.21
a
0.90
0.60
b,n
-
b
-
a
0.64
0.57
-
0.98
b,n
b
0.78 -
c,s
-
1.16
Russian Federation
0.51
-
United States
Israel
a,c,s
0.13
0.88
-
0.31
0.39
-
0.94
-
0.80
-
1.03
3
-
0.79
-
1.00
China3
0.82
0.85
-
United Kingdom
a,b
0.97
-
-
0.99
0.87
0.73
0.28
b
s
0.67
0.90
f,q
0.64
0.80
0.26
b,n
0.55
0.48
0.13
0.81
c,m,q
b
-
0.15
EU-15
0.21
0.79
0.73
a
2003
-
-
-
-
a
0.47
-
2.10
1.77
-
a
a
1.16 0.90
0.42
1.80
EU-25
0.83
-
1.75
Turkey3
0.65
0.14
e
b,n
b
-
s
-
0.79
0.51
a
a,b
2002
0.70
0.74
-
0.30
0.76 b
-
Switzerland
0.76 0.68
0.53 0.52
b,n
p
2001
e
0.44 a
0.69 b,n
-
2.31 e
b,j,q
n
-
2.24
0.79 -
s
1.41 b,p
b,n
-
1.65 a
0.78
1995
b,h,n
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
2. 1996 instead of 1995.
4. 1983 instead of 1981.
Source: OECD, MSTI database, May 2004.
5. 1982 instead of 1981.
StatLink: http://dx.doi.org/10.1787/846033432367
194
© OECD 2004
Statistical Annex
Table 7. R&D expenditures by sector of performance, 1981-2003 As a percentage of total national R&D expenditures Business enterprise 1981 Australia1, 2, 3
25.0
Austria4
55.9
b
1991
1995
2001
44.2
48.2
47.5
-
-
63.6
Belgium5
70.6
Canada
48.1
49.7
-
69.4
Czech Republic Denmark
a
49.7
Finland
54.7
France
58.9
a
69.0
Greece
22.5
Hungary
b
c,q
57.0 61.5 69.4
a
c,q,s
1995
2001
-
-
28.6
26.2
26.3
26.8
-
-
32.8
-
-
29.7
-
73.7
55.2
60.2
61.1
68.7
69.3
c,q
71.1
61.0
26.1
1991
59.6
63.2
a
1981
71.3
57.4 a
2003
58.1 65.1
58.5 a
Germany
66.5
Higher education 2002
63.2
69.9 a
66.3
b
29.5
a
32.7
b
43.4
c,s
40.1
c,s
69.9
n
69.4
b
-
69.1
b
22.6
22.2
a
22.1
16.4
a
15.1
17.1
16.2 a
a
15.6
24.5
18.8
23.1
19.5
18.1
19.2
18.9
19.5
n
-
16.4
16.9
b
17.1
c,q
16.7 a
44.3
a
44.9
b
24.8
c,s
25.7
c,s
a
-
26.0
29.4
-
-
16.0
23.2
b
20.4
-
-
17.9
r
21.5
a
25.5
-
17.6
b,k
12.1
b,k
14.5
-
-
-
8.2
10.4
e
10.4
-
-
-
-
0.3
-
-
-
56.4
r
55.8
a
53.4
Japan
66.0
b,j
75.4
b,j
Korea
-
-
73.7
76.2
e
74.9
Luxembourg3
-
-
-
92.6
-
-
74.4 e
c,q,s
27.5
18.8 b
b,k
22.4
b
c,s
16.1
b
-
-
-
32.6
-
-
14.5
13.9
e
-
-
-
20.8
30.3
-
-
-
-
45.8
30.4
-
49.7
52.1
58.3
-
-
23.2
29.7
28.8
27.0
-
-
-
26.8
27.0
36.5
-
-
-
28.6
30.7
30.3
-
-
Norway
52.9
54.6
56.7
a
59.7
57.4
-
29.0
26.7
26.0
a
25.7
26.8
-
Poland
-
-
38.7
a
35.8
21.4
-
-
-
26.3
a
32.7
33.5
31.2
21.7
20.9
a
31.8
34.4
b
-
20.6
43.0
37.1
a
36.7
35.6
-
74.6
53.9
c
67.3
64.3
j
-
-
3.9
5.9
c
9.0
45.5
56.0
48.2
54.6
a
-
23.0
22.2
68.5
74.3
-
30.0
a,j
27.4
b
25.0
New Zealand
Portugal6, 1 Slovak Republic Spain Sweden Switzerland
1, 2, 3
63.7
a,j
74.2
b
Turkey3
-
c,q
a
j
52.4 a
77.6
-
23.6
33.4
-
-
-
-
65.0
66.8
a
67.0
-
13.6
a
16.7
13.2
h
14.5
h
b
16.3
a,b
19.9
United States
71.2
h
72.5
h
71.8
h
73.0
h
70.2
h,n
68.9
Total OECD
66.2
b
68.8
a,b
67.2
a,b
69.3
b
68.0
b,n
-
16.0
61.6
b
64.0
b
63.6
b,n
-
-
b
64.4
b,n
-
17.6
-
-
China
-
b
71.1
21.1
-
67.1
62.3
24.3
73.9
a
EU-15
19.4
j
70.7
63.0
-
b
70.1
-
63.4
a,b
62.1
b
64.7
39.8
k,s
43.7
k,s
60.4
c
58.7
c
Israel
-
55.7
Russian Federation
-
77.5
68.5
75.3
61.2 c,n
70.3
73.0 69.9
c,n
h,n
18.8 8.6
-
-
26.6
-
-
5.7
9.1
b j
-
29.8
-
j
-
-
22.9
-
-
-
69.0
60.4
-
-
-
19.2
21.8
22.6
-
21.9
a,h,j
15.2
h
14.5
h
15.9
h,n
b,n
16.8
17.5
a,b
17.4
b
18.1
20.8
b
21.5
b
-
-
a,b
20.8
a,b
21.4
b
-
-
j,s
12.1
j,s
c,e
25.6
c,e
a,b
j
30.9
32.0
-
United Kingdom
EU-25
c,q
a
h
5.4
9.8 16.1 5.2
10.1 c,e,n
17.5 5.4
b
-
25.2
53.3
Netherlands
n
-
-
Italy
33.8
18.2
b
34.9
b
70.0
Mexico
26.7
15.7
8.5
n
57.2
b
73.7
-
c,q
32.8
20.3
63.6
70.3
1.6
19.2 29.3
-
43.6
49.1
-
23.9 26.8
14.5
Ireland
b,j
-
b
-
21.8
b
26.2 30.6
-
-
9.6
69.7
a
26.7
-
c,s
Iceland
b
19.2 n
-
2003
35.5
41.4
58.9
53.7
-
62.2
-
31.9
n
2002
h,n
-
c,e,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/458542005788
195
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 7. R&D expenditures by sector of performance, 1981-2003 (cont'd) As a percentage of total national R&D expenditures Government
Australia1, 2, 3
1981
1991
1995
2001
Private non-profit 2002 -
2003
1981
1991
1995
2001
45.1
28.1
23.5
22.9
-
-
1.3
1.6
2.1
2.7
Austria4
9.0
-
-
6.4
-
-
2.3
-
-
0.3
Belgium5
5.6
3.5
6.0
-
Canada
a
24.4
Czech Republic
6.1 18.7
-
29.0
Denmark
22.7
17.7
Finland
22.6
a
France
23.6
a
Germany
13.4
Greece
63.1
Hungary Iceland Ireland
b
20.2
24.5
60.7
44.5
Italy
25.7
r
Japan
12.0
b,k
Korea
-
26.5
a
a
c,q,s
11.7
23.7
23.0
11.7
7.0
16.7
10.2
10.4
16.5 m
13.7
25.5
a
22.1
b
-
25.6
c,s
25.9
c,s
11.6
9.0
22.7
a
21.1
b,k
10.4
20.1
b,k
17.0
7.9
-
7.1
20.8
18.3
18.1
14.2
Norway
42.2
17.7
18.8
17.3
a
-
-
35.0
a
43.6
22.1
27.0
-
21.5
Poland Portugal
6, 1
Slovak Republic Spain
31.6
c,q
40.2
-
0.6
a
0.7
1.1
a
0.8
13.8
b,m
0.5
0.5
a
b
0.6
0.6
0.6
1.3
1.4
1.4
-
-
-
-
0.7
32.9
-
-
-
-
24.5
b
-
3.7
4.4
-
1.1
1.7
0.8
b,k
4.8
b,k
4.4 -
1.1
e
1.3
e
-
-
-
2.8
2.3
1.0
0.6
-
-
-
-
-
-
-
-
-
-
14.6
15.8
-
0.5
-
-
-
-
-
31.3
44.9
-
-
-
0.1
20.8
19.8
b
-
4.6
13.2
15.0
26.6
c
-
-
-
-
23.7
a
c
15.9
a,m
1.1
0.1
0.2
Switzerland1, 2, 3
5.9
b
3.7
f
2.5
f
1.3
a,f
-
-
3.2
a,h
1.2
2.5
-
2.1
-
0.5
China
-
a
-
a
a
a
0.2
0.3
10.8
10.2
0.0
0.0
-
0.8
0.2
-
0.1
-
-
-
-
1.9
-
b
-
7.4
6.2
-
-
-
-
-
-
-
-
-
14.5
a
14.6
9.9
a
8.9
-
2.9
a
1.8
1.3
1.5
1.5
-
9.8
f
9.4
7.9
f
8.8
3.1
h
3.3
h
b
2.6
a,b
7.9
12.4
a,b
b
-
2.3
-
-
-
18.8
-
0.2
0.3
EU-15
-
-
-
b
-
b
0.4
-
-
2.2
-
-
15.2
2.3
-
15.4
EU-25
-
-
f
Total OECD
-
-
-
2.8
f
-
-
-
a,f
12.5
-
-
3.7
United States
b
f
a,b
10.5
b
11.0
b,n
-
2.6
b
13.6
b
13.7
b,n
-
-
b
13.0
b,n
-
1.4
-
-
-
-
-
-
-
16.2
b
13.1
49.6
j,s
42.1
j,s
29.7
c
10.8
Russian Federation
-
16.8
f,n
16.8 a,b
-
9.1
12.5
16.9
Israel
f,n
9.9 26.1
c
5.2
28.7 c,n
24.3
5.8 24.5
c,n
b
3.6
h
4.7
h
5.1
h,n
5.3
2.7
a,b
2.8
b
2.9
b,n
-
0.9
b
0.9
b
0.8
b,n
-
a,b
0.9
b
0.9
b
0.8
b,n
-
6.9
c
5.8
c
3.4
c,n
3.8
0.0
h
0.0
0.9
-
-
0.2
-
0.2
n
n
-
f
20.6
0.4
b,k
1.2
4.1
United Kingdom
b
-
a,f
a
a
3.2 b
6.1
-
18.6
-
Sweden Turkey3
21.3
-
0.6
-
33.2
c
0.3
0.7
-
39.1
44.6
0.5
-
e
0.2
1.1
-
13.4
n
0.1
-
-
0.2
-
-
33.0
-
0.2
1.2
4.5
-
1.1
0.7
-
-
-
1.4
1.0
c,s
-
-
0.9
-
-
b
-
-
e
1.2
-
2003
-
9.5
12.4
a
0.8
9.5
-
-
b
11.2
4.6 n
18.4
Mexico
New Zealand
b,m
13.7
Luxembourg3
Netherlands
17.0
b,m
b
a
n
15.5
37.5
-
10.9
17.0
b
8.1
c,q
21.0
40.1
-
39.3
c,q
22.7 14.4
a
14.4
n
2002
h,n
c,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
196
© OECD 2004
Statistical Annex
Table 8. GERD by sector of performance, 1981-2003 As a percentage of GDP Business enterprise 1981 1, 2, 3
Australia
0.2
4
Austria
Belgium
b
0.6 5
1.1
Canada
0.7
0.8
0.7
-
-
1.1
1.2
1.6
-
1.0
1.2
1.1
0.8
0.8
1.6
1.7
1.1
-
1.4
Finland
0.6
France
1.1
a
Germany
1.7 0.0
Hungary
b
c, q
1.0 a
Iceland
2001
0.8
0.5
Greece
1995
0.6
Czech Republic Denmark
a,a
1.2 1.5 1.7
a
0.4
0.1
0.3
0.7
c, q
1.1 a
a,a
0.1
-
c, q, s
1.4
2.4
1.4
1.4
2002
b, n
a
b
0.1
a
0.2
b
0.3
a, c, s
0.4
c, s
0.5
0.6
b
0.9
0.3
Italy
0.5
r
0.7
a
0.5
Japan
1.4
b, j
2.1
b, j
1.9
1.8
1.8 b
0.8
2003
b
1981
1991
1995
2002
-
-
0.3
0.4
0.4
0.4
-
0.4
-
-
0.5
0.4
0.4
-
0.5
0.6
0.6
0.2
0.2
0.5
0.5
0.6
0.4
0.6
0.7
0.4
0.4
n
1.0
a
0.4
0.3
0.5
-
-
0.0
-
0.3
-
0.3 0.3
a
n
-
1.7
b
1.7
b
b
c,q
0.4 a
1.4
-
0.3 b, n
0.4
0.5 0.4 0.4
a
-
0.0
0.4
c, s
-
-
0.2
1.8
b
-
0.2
0.3
a
a
0.1 c,q,s
0.1
b
0.2
a
0.3
b
0.2
a,c,s
0.2
c,s
0.4
0.2
b
0.3
-
0.1
0.5
-
-
0.2
r
0.3
a
0.3
b, j
2.3
2.3
-
0.4
b,j,k
0.3
b,j,k
0.4
e
2.2
-
-
-
0.2
2.2
e
c,q
b,n
0.4
-
e
2001
-
2.4
1.5
Ireland
Korea
Higher education
1991
0.4
0.6 b
0.3
b
2003
-
-
-
n
0.7
a
-
0.4
n
-
0.4
b
0.4
-
c,s
-
0.5
b
-
-
-
0.4
-
-
b,j,k
0.4
0.4
-
e
0.3
e
0.3
e
-
-
1.8
Luxembourg
-
-
-
1.6
-
-
-
-
-
0.0
-
-
Mexico
-
-
0.1
0.1
-
-
-
-
0.1
0.1
-
-
1.0
1.0
1.0
-
-
0.4
0.6
0.6
-
-
-
0.3
0.3
Netherlands New Zealand Norway
0.3
0.3
0.6
0.9
1.0
a
0.3
a
0.2
6, 1
-
a
0.3
c,c
0.4
0.4
a
0.5
2.5
a, k
3.3
-
0.3
0.4
0.4
a
0.4
0.4
0.1
b
-
-
-
0.2
a
0.2
0.2
b
-
1.0
0.3
-
0.1
0.6
a
-
0.1
0.2
-
-
0.7
a,j,k
0.7
1.9
-
-
0.4
b
0.6
0.6
0.1
0.2
-
-
-
0.4
0.3
1.3
1.2
a
1.3
-
0.3
a
0.3
0.4
0.3
h
0.4
h
0.4
h
0.4
h
0.4
h,n
0.4
0.3
b
0.4
a,b
0.4
a,b
0.4
b
0.4
b,n
-
0.4
b
0.4
b
-
-
b
-
-
1.9
1.6
b
1.8
1.9
0.1
j, k
k
United Kingdom
1.5
a
1.4
United States
1.7
h
2.0
h
1.8
h
2.0
h
1.9
h, n
1.8
Total OECD
1.3
b
1.5
a, b
1.4
a, b
1.6
b
1.5
b, n
-
1.1
b
1.2
b
1.2
b, n
-
-
b
1.2
b, n
-
0.3
-
c, n
3.4
c, n
-
-
EU-15
1.0
b
1.2
a, b
1.1
b
1.2
China
-
0.3
k, s
0.3
k, s
0.6
Israel
-
1.4
c
1.6
c
3.8
-
0.6
1
Russian Federation
-
0.1
a, j, k
-
-
-
1.4
EU-25
-
-
Sweden
-
a
j, k
0.5
Turkey
0.4
b
0.2 1, 2, 3
0.5
0.3
Spain
3
a
0.4
1.6
k
a
1.0
0.1
0.1
-
c, q
0.4
0.5
0.1
Slovak Republic
Switzerland
1.1
-
Poland Portugal
a
0.6
0.8
0.8
0.9
b, h, n
c,q
j,k
a,b
0.2
a
0.3
0.3
b
-
0.1
c
0.1
j,k
0.1
j,k
-
0.3
a
0.3
b
0.3
-
0.7
a,h,j,k
0.8
j,k
-
-
0.6
-
-
0.4
-
-
0.4
0.4
-
0.4
a,b
0.4
a,b
0.4
-
0.1
j,k,s
0.1
j,k,s
0.1
-
0.7
c,e
0.7
c,e
0.8
0.0
h
0.0
0.1
0.1 c,e,n
0.8 0.1
b
-
0.3
3
b,n
-
h,n
c,e,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/500804062506
197
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 8. GERD by sector of performance, 1981-2003 (cont'd) As a percentage of GDP Government 1981
1991
1995
2001
Australia1, 2, 3
0.4
0.4
0.4
0.4
Austria4
0.1
-
-
0.1
Belgium5
0.1
0.1
Canada
0.3
Czech Republic
a
0.1 0.3
-
0.6
Denmark
0.2
0.3
Finland
0.3
a
France
0.5
a
Germany
0.3
Greece
0.1
Hungary
b
0.4
a
0.5 0.4
a
0.2 c,q
0.3
0.1 c,q,s
1995
2001
2002
2003
-
-
0.0
0.0
0.0
0.0
-
-
-
-
0.0
-
-
0.0
-
-
0.1
-
-
0.1
0.0
0.0
-
-
0.2
0.2
0.0
0.0
0.0
0.3
0.4
0.3
0.4
0.4
b,m
0.3
m
0.3
0.1
a
0.1
b
-
0.2
a,c,s
0.2
c,s
Ireland
0.3
0.1
b
0.1
Italy
0.2
r
0.3
a
0.2
Japan
0.3
b,j,k
0.2
b,j,k
0.3
0.6
0.6 b
0.1
b
a
0.4
b,m
0.3
n
n
0.3
0.5
0.2
b,n
a
0.0
0.0 0.0
n
0.0
-
-
-
-
0.0
0.0
-
-
0.0
0.0
0.0
0.0
0.0
-
-
0.0
a
0.0
0.0
0.0
0.0
0.0
a
0.0
0.0
0.0
0.0
0.0
-
-
-
-
-
-
-
0.0
-
-
0.3
b,m
-
a
a
0.0
b
-
0.3
c,s
-
-
-
-
-
-
b
-
0.0
0.1
0.0
0.1
0.1
-
-
-
-
-
-
-
0.0
0.0
-
-
-
-
b,j,k
0.3
0.3
-
0.1
e
0.4
-
-
0.4
e
b,j,k
b
0.0
b
0.1
b,j,k
0.1
a
0.1
-
0.0
e
0.0
e
0.0
0.1
b,j,k
b
-
e
-
-
0.4
-
-
-
0.1
-
-
-
-
-
-
-
-
-
0.1
0.2
-
-
-
-
0.0
0.0
-
-
0.4
0.4
0.4
0.3
-
-
0.0
0.0
0.0
-
-
-
0.4
0.4
-
Mexico
New Zealand
a
-
-
-
-
-
-
-
-
0.0
-
-
-
-
0.3
b
-
-
-
-
0.0
0.0
b
-
0.2
b
-
0.0
0.1
0.1
0.1
0.1
b
-
0.2
k,c
-
-
-
-
-
0.0
k
0.2
-
-
0.0
0.0
a
0.0
0.0
0.0
a,k
0.2
0.3
0.3
Poland
-
-
0.2
a
0.2
0.1
0.1
0.2
a
0.2
0.4
c
0.2
0.2
a
0.2
k,c
-
0.5
Spain
0.1
0.2
Sweden
0.1
a,f,k
0.1
f,k
0.1
a,f,k
0.1
f,k
-
-
0.0
Switzerland1, 2, 3
0.1
b
0.1
f
0.1
f
0.0
a,f
-
-
-
Turkey3
-
a,k
0.0
k
0.0
a
0.1
0.0
k
0.0
-
-
-
-
-
-
0.0
0.0
-
-
-
-
-
-
-
-
United Kingdom
0.5
a
0.3
a
0.3
0.2
a
0.2
-
0.1
a
0.0
0.0
0.0
0.0
-
United States
0.3
f,h
0.3
f,h
0.2
f,h
0.2
f,h
0.2
f,h,n
0.1
h
0.1
h
0.1
h
0.1
h
0.1
h,n
0.1
Total OECD
0.3
b
0.3
a,b
0.3
a,b
0.2
b
0.2
b,n
0.1
b
0.1
a,b
0.1
a,b
0.1
b
0.1
b,n
-
0.3
b
0.2
b
0.3
b,n
-
-
0.0
b
0.0
b
0.0
b,n
-
b
0.3
b,n
-
0.0
a,b
0.0
b
0.0
b
0.0
b,n
-
-
-
-
c,n
0.3
c,n
-
-
0.2
c
0.2
c
0.2
c,n
0.2
c,n
-
-
-
0.0
h
0.0
EU-25
-
EU-15
0.3
China
-
0.0
a
0.3
Norway
Slovak Republic
0.0
-
0.2
0.4 a
c,q
a
a,m
b
0.3
a,b
0.3
b
0.3
0.4
j,k,s
0.3
j,k,s
0.3
c
0.3
c
0.3
Israel
-
0.3
Russian Federation
-
0.1
0.2
0.4
0.3
0.3
0.2 -
b,f,h,n
b
0.0
-
-
0.0
-
0.0
b,n
n
0.8
0.2 e
b
3
Portugal6, 1
b,n
0.2
-
Netherlands
1991
0.3
0.4
Luxembourg
1981
0.3
0.5 a
2003
0.3
Iceland
Korea
c,q
Private non-profit 2002
h,n
-
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
198
© OECD 2004
Statistical Annex
Table 9. Business R&D expenditures, 1981-2003
Millions constant USD (1995 PPPs) 1981
1985
1995
2001
2002
2003
1981
1985
1991
1995
2001
2002 -
1 067
b
1 896
3 306
3 718
-
-
0.4
0.5
0.7
1.1
0.9
814
949
b
-
-
2 214
-
-
0.5
0.4
-
-
0.6
-
Belgium
1 664
2 020
2 228
2 681
4 042
4 170
n
-
1.0
0.9
0.8
0.9
1.0
1.1
Canada
2 811
3 958
4 660
9 850
8 875
n
8 630
1.7
1.7
1.6
2.2
2.5
2.3
1 066
1 100
-
-
0.6
0.3
0.3
0.3
Australia
591
Austria
1
Czech Republic
b
As a percentage of total OECD
1991
b
6 536 c,q
818
a
b,n
-
-
-
1 613
Denmark
470
671
1 038
1 239
2 248
2 404
-
0.3
0.3
0.4
0.4
0.6
0.6
Finland
494
797
1 105
1 402
3 001
3 056
-
0.3
0.4
0.4
0.5
0.8
0.8
France
10 528
12 974
17 191
Germany
19 239
23 586
29 116
Greece2
46
95
126
Hungary
-
-
406
a
q
17 356
20 217
26 122
33 897
198
361
297
a
b
19 853
n
-
33 934
b
33 464
-
447
443
-
-
-
0.1
0.1
0.1
0.1
-
0.0
0.0
0.0
0.0
0.0
0.0
-
0.1
0.1
0.1
0.2
0.2
-
2.6
2.7
2.7
2.2
1.8
1.8
15
29
139
136
575
873
-
7 278
7 221
6 351
j
37 894
j
56 098
j
53 174
j
8.7
0.1
310 a
5.1
8.6
0.1
6
7 746
5.1
8.9
0.0
160 r
5.9
0.0
3
6 199
6.0 10.2
0.0
109 r
5.7 10.4
-
Ireland
4 461
6.2 11.4
-
Iceland
Italy
b
b
n
7 313
n
Japan
25 562
68 522
70 103
-
15.2
16.7
19.7
18.0
17.4
17.9
Korea
-
-
-
9 525
15 024
15 621
-
-
-
-
3.2
3.8
4.0
Luxembourg3
-
-
-
-
294
-
-
-
-
-
0.1
-
-
Mexico
-
-
543
402
968
-
-
-
-
0.2
0.1
0.2
-
2 292
2 866
3 018
3 466
4 468
1.1
Netherlands New Zealand Norway Poland Portugal4, 2, 5 Slovak Republic Spain
319
4 203 a
-
141
164
495
834
825
1 001
a
1 372
1 354
-
-
-
728
a
863
480
85
95
169
157
a
436
521
-
-
648
219
c
233
210
1 351
2 768
2 058
798 a
3 024
3 344
Switzerland2, 5, 6, 3
2 399
b
3 482
a
b,c,q
2 416 k
4 673
3 830 a,k
n
-
-
Sweden Turkey2
b,j,q
-
4 416
b
b
a
-
1.4
1.3
1.1
1.2
1.1
-
-
-
0.0
0.1
0.1
-
-
0.3
0.4
0.3
0.3
0.3
0.3 0.1
-
-
-
-
0.2
0.2
-
0.0
0.0
0.1
0.1
0.1
0.1
-
-
-
0.2
0.1
0.1
0.1
-
0.5
0.6
1.0
0.8
1.0
1.1
7 376
k
-
-
1.2
1.3
1.2
1.6
1.9
-
3 321
3 513
3 884
-
-
-
1.4
1.5
1.2
1.1
1.0
-
-
324
303
879
-
-
-
-
-
0.1
0.1
0.2
-
United Kingdom
12 089
13 045
14 533
14 615
17 053
a
17 564
-
7.2
5.7
5.1
5.0
4.3
4.5
United States
81 589
h
179 673
h
172 371
h,n
170 945
48.4
49.4
44.9
44.8
45.5
44.1
168 685
b
Total OECD EU-25
-
EU-15
55 136
112 257
h
227 013
b
b
67 794
127 965
h
284 999
a,b
b
132 109
h
294 874
a,b
394 706
b
390 610
b,n
-
100
100
100
100
100
100
85 141
b
110 640
b
111 945
b,n
-
-
-
-
28.9
28.0
28.7
b
107 593
b
109 291
b,n
-
32.7
29.9
29.5
28.1
27.3
28.0
-
-
1.9
2.7
8.0
10.3
c,n
3 916
-
-
0.4
0.5
1.1
1.0
-
-
2.7
1.7
2.2
2.4
84 074
a,b
82 839
China
-
-
5 505
k,s
7 871
k,s
Israel
-
-
1 079
c
1 544
c
Russian Federation 5
-
-
7 532
5 121
31 668 4 470 8 628
40 066 c,n
4 024
b,h,n
-
9 539
-
c,n
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1998 instead of 2001.
2. 1986 instead of 1985.
Source: OECD, MSTI database, May 2004.
3. 2000 instead of 2001.
4. 1982 instead of 1981.
5. 1992 instead of 1991.
6. 1996 instead of 1995.
StatLink: http://dx.doi.org/10.1787/730082336242
199
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 10. BERD intensity, 1981-2003 As a percentage of value added in industry
1981
1985
1995
2000
2001
2002
2003
1.1
-
-
-
2.5
n
1.4
b,n
0.5
b
0.8
1.2
1.0
0.9
1.0
b
-
-
1.6
Belgium
1.5
1.7
1.6
1.8
2.2
2.4
Canada
0.8
1.0
1.1
1.5
1.6
Australia Austria
1
b
1991
0.3
Czech Republic
b
1.4 c,q
b
1.4
-
-
1.8
1.1
1.0
1.1
-
Denmark2
0.9
1.1
1.5
1.7
2.3
2.6
2.8
-
Finland
0.9
1.3
1.8
2.2
3.5
3.6
3.6
France
1.6
1.9
2.1
2.1
2.0
2.1
Germany
2.3
2.7
2.5
2.1
2.5
Greece3, 2
0.0
0.1
0.1
0.2
0.3
a
q
0.9
a
-
b
a
2.5 0.3
b
n
-
2.5
b
2.5
0.6 2.8
b
-
-
0.6
0.5
0.5
0.2
0.4
0.8
2.5
b
2.8
Ireland
0.4
0.5
0.8
1.3
1.1
b
1.1
-
Italy
0.6
r
0.8
0.8
n
Japan
1.7
j
b
Korea
-
r
2.3
j
-
1.0
a
2.6
j
-
Luxembourg
-
-
-
Mexico
-
-
0.1
1.4
1.6
-
-
Netherlands New Zealand2 2
0.7 2.4
0.8 j
3.0
3.1
2.8
2.7
-
-
2.2
-
-
0.2
0.2
-
1.4
1.5
1.6
1.6
1.6
0.4
0.3
0.4
0.9
1.3
1.3
1.5
Poland
-
-
-
0.4
a
0.4 0.6
Spain
0.1
0.1
0.2
0.2
a
-
-
-
0.7
c
0.4
0.6
0.2 2
Sweden
2.2
a
Switzerland3, 5, 6
1.6
b
Turkey United Kingdom
2.9 2.6
a,b
0.5
3.0
k
2.9
b
0.8
2.8
Norway
Slovak Republic
-
2.4
0.1
b,j,q
-
2.2
a
Portugal4, 3, 5
b
1.4 0.3
b
b
0.7
3.8
a,k
4.3
3.1
b
3.1
0.6
a,b
n
-
-
-
1.4
-
0.3
0.2
b
0.4
0.5
b
0.6
0.5
5.2
0.8 k
-
-
a
-
-
-
-
-
-
-
-
-
0.1
0.1
0.3
-
2.1
2.0
2.0
1.8
1.8
1.8
a
2.7
h
2.6
b,h,n
2.2
b
2.1
b,n
-
1.8
b,n
-
0.9
b
-
5.4
b,c,n
1.1
b
United States
2.2
h
Total OECD
1.7
b
EU-25
-
EU-15
1.4
China
-
Israel Russian Federation
-
2.8
h
2.1
b
b
1.7
2.8
h
2.1
a,b
b
-
2.5
h
2.8
h
2.0
a,b
2.2
b
-
-
-
1.7
a,b
1.6
b
1.8
b
1.8
0.3
k,s
0.3
k,s
0.7
a
0.7
2.5
c
5.4
c
1.0
b
0.6
0.7
6.0
1.9
-
b
c,n
1.1
n
-
1.4
0.7 k
b
b
0.1
0.8
0.6
-
2.0
Iceland
Hungary
b,n
2.5
b,h,n
-
5.1
b,c,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability:
200
1. 1998 instead of 2000.
3. 1986 instead of 1985.
5. 1992 instead of 1991.
2. 1999 instead of 2000.
4. 1982 instead of 1981.
6. 1996 instead of 1995.
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/754616431240
© OECD 2004
Statistical Annex
Table 11. Business R&D expenditures by source of funds, 1981-2003 As a percentage of total national R&D expenditures
Industry 1981 Australia
75.5
Austria
88.4
Belgium
91.5
Canada
81.9
1
Czech Republic
b,p
a
1995
2001
2002
2003
1981
92.7
92.9
88.7
-
-
8.4
-
-
64.4
-
-
7.4
89.2
82.7
83.9
n
-
8.3
74.3
75.9
75.9
n
75.9
91.4
b
71.6
n
b,p
a
10.7
1991
1995
2001
2002
2003
3.0
2.4
5.1
-
-
-
-
5.5
-
4.3
5.7
5.9
n
-
3.2
3.2
n
3.2
7.8
b
9.9
6.2 c,q
-
92.2
84.3
84.0
-
-
6.6
12.2
12.1
84.4
a
86.0
76.9
87.4
-
-
12.4
7.9
6.1
3.1
-
-
Finland
94.9
a
93.3
89.1
95.6
95.7
-
4.2
5.5
5.6
3.4
3.2
-
France
68.2
76.1
82.9
12.7
8.4
10.2
6.7
66.2
81.7
Greece
87.0
a
87.5
95.4
74.0
-
87.0
Iceland
53.3
84.5
95.5
Ireland
80.5
89.6
98.2
Italy
86.9
Japan
97.9
Korea
-
Hungary
2
Luxembourg
3, 4
69.4
s
10.1
-
4.6
5.5
-
-
8.2
6.2
b
6.4
s
-
2.3
b
s
6.1
s
1.4
-
-
p
2.7
-
-
16.7
14.9
15.0
7.4 q,s
a
16.2
7.2
-
-
38.3
9.6
3.3
-
-
13.7
3.7
4.9
75.2
78.2
78.0
98.4
98.2
97.8
97.9
-
1.9
1.4
1.6
0.8
1.0
-
96.3
91.2
93.0
-
-
-
3.6
8.1
6.4
-
-
-
-
97.8
-
-
-
-
-
1.6
-
-
r
77.2
a
b,q
p
-
n
78.2
n
8.8
r
13.2
a
b,k,q
-
n
14.4
89.8
-
-
-
0.0
2.8
9.6
-
80.0
80.3
-
-
7.5
7.5
6.6
5.2
-
-
-
87.8
86.4
78.8
-
-
-
7.2
6.9
8.6
-
-
73.0
76.8
82.5
a
81.4
-
-
25.3
15.9
11.9
a
10.3
-
-
67.6
86.5
-
-
-
33.8
a
30.4
11.8
-
-
1.6
9.1
5.1
a
2.1
-
-
-
-
11.4
10.8
c
20.6
21.1
-
4.1
11.3
9.5
9.6
-
-
64.7
a
92.9
80.5
78.6
a
94.4
-
-
88.6
87.7
c
78.3
77.5
c,q
80.4
84.4
84.6
a
88.0
86.8
98.7
b
95.5
92.5
-
99.9
United Kingdom
61.3
69.4
United States
68.4
h
77.4
h
82.2
Total OECD
76.1
b
82.6
a,b
2
Turkey
EU-25
-
EU-15
76.1
2
-
China
2
b
78.9
a,b
-
Israel
-
74.2
Russian Federation
-
-
82.5 a
-
13.6
a
10.3
-
1.3
b
1.7
-
-
-
-
0.0
a
66.0
-
30.0
14.6
90.6
h
90.1
h,n
90.0
31.6
22.6
17.8
9.4
89.2
b
89.2
b,n
-
82.6
b
-
-
-
82.8
b
-
-
19.3
86.4
a,s
-
-
-
90.4
c,n
91.3
92.4
70.5
66.6 h
85.1
a,b
80.5
b
80.5
b
78.6 43.7
9.2
-
c
c,q
-
91.2 91.4
c
84.0
a
41.5
h,n
22.3
b
14.7
f
a,b
b
13.4
a,b
-
-
-
-
25.8
40.9
-
-
-
9.5
a
5.8
2.4
f
2.3
f
1.7
4.3
10.5
8.9
a
-
-
-
-
-
-
-
-
a
6.8
-
9.9
n
b,n
10.0
11.7
a,b
7.2
b
7.1
10.8
b
7.9
b
-
-
10.7
b
7.7
b
-
-
6.8
a,s
-
-
9.6
c
-
-
50.6
-
c
a
21.3 51.1
c
49.0
n
-
76.2
a
b
-
92.8
4, 5, 2
Switzerland
s
16.9
a
73.1
93.6
Sweden
-
75.7
22.3
89.6
Slovak Republic Spain
80.2
b
91.0
24.6 b
100.0
Poland Portugal
s
91.2
b
-
New Zealand Norway
78.3
-
n
-
84.3
Mexico Netherlands
90.7
76.1 q,s
a
a
4.5
c,q
-
Denmark
Germany
-
Government
1991
n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1998 instead of 2001.
3. 1982 instead of 1981.
2. 2000 instead of 2001.
4. 1992 instead of 1991.
Source: OECD, MSTI database, May 2004.
5. 1996 instead of 1995.
StatLink: http://dx.doi.org/10.1787/250760635132
201
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 11. Business R&D expenditures by source of funds, 1981-2003 (cont'd) As a percentage of total national R&D expenditures
Other national sources 1981 b,p
Abroad
1991
1995
2001
2002
2003
1981
0.3
1.7
0.7
-
-
1.6
-
-
0.1
-
-
4.1
0.4
0.1
0.1
n
-
0.2
n
0.0
b,p
1991
1995
2001
2002
2003
4.1 -
3.1
5.6
-
-
-
30.1
-
6.1
11.5
10.3
n
-
n
21.0
Australia
0.3
Austria
0.1
Belgium
0.0
Canada
0.0
0.0
0.0
0.0
0.0
7.4
18.5
19.5
21.0
21.0
-
-
0.2
1.6
1.6
-
-
-
3.2
1.9
2.3
1
Czech Republic
a
a
0.0
b
n
a
0.9
b
-
Denmark
0.5
1.7
1.5
0.3
-
-
2.8
4.4
15.5
9.2
-
-
Finland
0.0
0.1
0.1
0.3
0.1
-
0.9
1.2
5.3
0.7
1.0
-
France
0.1
0.1
0.0
0.0
7.1
11.4
11.1
8.7
2.2
2.4
Germany
0.2
0.3
a
0.1
a
0.2
0.2
Greece
-
-
0.0
0.0
b
Hungary
-
-
-
0.1
s
Iceland
0.0
0.0
0.0
Ireland
0.1
0.2
0.5
Mexico Netherlands New Zealand Norway Poland 3, 4
Portugal
Slovak Republic Spain Sweden 2
Turkey
United Kingdom
1.2
2.6
-
-
20.6
-
2.8
a
16.5 q,s
4.1
0.2
-
-
8.4
5.9
1.2
-
-
-
5.7
6.6
3.8
n
-
0.3
0.3
0.8
0.6
-
-
0.2
0.2
0.1
-
-
-
-
-
-
-
0.3
n
-
4.3
r
a
p
2.4
17.5
b
-
16.9
s
22.6
b
2.4
s
-
-
-
4.5
-
-
8.2
6.6
6.8
0.1
0.5
0.5
-
-
0.0
0.6
-
-
-
0.6
-
n
7.1
0.5
-
-
-
-
0.4
0.0
-
-
-
-
20.7
0.6
-
0.6
0.1
0.1
-
-
8.2
2.4
13.2
14.4
-
-
-
0.2
1.0
0.9
-
-
-
4.9
5.7
11.8
-
-
0.0
0.1
0.1
a
0.0
-
-
1.7
7.2
5.6
a
8.4
-
-
0.2
a
0.2
0.3
-
-
-
1.3
a
1.8
1.4
0.3
a
-
-
-
5.5
10.4
16.1
a
3.6
2.9
c
0.0
0.3
c
1.1
1.2
0.3
0.5
7.8
5.9
-
-
0.0
-
-
-
-
0.0
0.1
0.2
0.1
a
a
0.1
a
-
-
-
1.6
-
2.2
8.1
6.4
a
a,j
a
0.2
0.1
-
-
1.8
1.6
3.7
-
0.2
0.7
0.5
-
-
-
-
2.7
4.4
5.8
-
-
-
1.4
1.4
-
-
-
-
0.1
5.6
1.9
a
0.0
-
8.7
16.0
19.1
24.4
-
-
-
-
-
-
0.0
0.0
United States
0.0
0.0
0.0
0.0
Total OECD
0.1
b
0.1
EU-25
-
EU-15
0.1
China
2
-
-
Israel
2
-
0.0
Russian Federation
-
-
a,b
0.2
n
0.0
n
b
-
a
-
-
-
-
-
-
-
-
-
a
27.2
-
-
-
0.1
a,b
0.2
b
0.2
b,n
-
-
-
-
-
-
0.1
b
0.2
b
0.1
b,n
-
-
-
8.6
b
9.2
b
-
-
a,b
0.1
b
0.1
b
0.1
b,n
-
4.6
a,b
8.8
b
9.3
b
-
-
-
-
-
-
4.0
a,s
-
-
c
0.1
c
0.0
c
-
-
-
0.0
c
0.0
c
0.0
c
-
-
0.1
-
-
-
8.4
-
b
0.0
2.9
-
-
0.0
0.3
b
7.5
-
-
5.1
9.2
n
-
-
a
b
-
25.3
0.1
0.1
9.6
s
a
0.0
0.0 4, 5, 2
Switzerland
b
-
0.1
0.0 2
s
0.2
-
0.0
Japan
Luxembourg
0.1
b
0.1
Italy
Korea
r
p
-
n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1998 instead of 2001.
3. 1982 instead of 1981.
2. 2000 instead of 2001.
4. 1992 instead of 1991.
5. 1996 instead of 1995.
Source: OECD, MSTI database, May 2004.
202
© OECD 2004
Statistical Annex
Table 12. Business R&D expenditures, by two main sources of funds, 1981-2003 As a percentage of GDP
Industry 1981 b,p
1995
0.54
0.81
0.69
-
-
0.02
-
-
0.73
-
-
0.05
1.09
1.32
1.38
n
-
0.08
0.92
0.80
n
0.77
0.66
0.66
Australia
0.18
Austria1
0.56
Belgium
0.92
Canada
0.49
0.57
-
-
Czech Republic
a
Government
1991
0.99
b
2001
0.74 c,q
0.61
c,q
2002
2003
1981
b,n
-
a
0.83
0.81
1.44
-
-
0.07
a
1.08
1.28
2.31
2.31
-
0.03
France
0.78
1.07
1.17
Germany
1.36
1.52
Greece
0.04
0.07
-
0.38
Iceland
Hungary
0.03
0.22
Ireland
0.23
q,s
1.30
1.59
0.11
a
0.17
b
-
0.25
a,s
0.29
s
0.48
0.53
0.87
2.03
-
1.56
Mexico
-
0.09
0.05
0.80
0.88
0.83
-
0.23
0.22
0.45
0.68
0.79
a
0.16
a
0.16
Spain Sweden 4, 5, 2
0.10 1.41
0.18
0.38
1.19
a
1.55
b
1.65
c,q
k
0.03
n
0.03
0.03
0.10
0.10
n
0.06
0.05
-
-
0.08
0.08
-
0.18
0.12
0.15
0.12
0.18
0.00
0.00 r,s
j
a
0.05
a,s
0.02
0.02
0.04
0.01
0.04
0.09
a
0.09
0.03
j
0.03
a
0.00
b
-
0.02
s
0.03
0.03 p
0.11
0.02
0.02
-
0.14
-
-
-
0.01
-
-
0.06
-
-
-
-
0.03
2.03
-
-
-
0.07
0.18
-
-
-
-
-
0.02
0.11
-
-
-
-
0.00
0.88
-
-
0.07
0.07
0.07
-
-
-
0.02
0.02
-
0.16
0.14
0.11
a
0.10
-
-
-
-
0.08
a
0.07
0.02
a
0.78
0.11
b
0.09
a
0.25
-
-
0.00
0.01
0.44
c
0.34
0.29
-
-
0.18
0.33
a
0.41
0.47
-
0.01
0.05
2.16
a,k
3.03
k
-
0.19
a
-
-
0.02
b
a
-
c,q
0.19
k
0.03
f
0.04
-
a
0.01
-
0.09
0.08
0.04
a
0.05
0.05
0.24
a,k
0.19
k
-
-
0.05
f
0.04
f
-
-
-
0.11
0.08
0.19
-
-
-
-
0.00
0.00
0.01
-
-
United Kingdom
0.92
0.96
0.89
0.83
a
0.83
-
0.45
0.20
0.13
0.11
a
0.09
United States
1.14
h
1.53
h
1.48
h
1.81
h
1.68
h,n
1.63
Total OECD
0.97
b
1.26
a,b
1.19
a,b
1.41
b
1.37
b,n
-
0.85
b
0.97
b
-
-
-
a,b
0.90
b
1.03
b
-
-
0.20
0.52
a,s
-
-
-
-
c
1.27
c
3.22
c,n
-
-
-
0.36
0.36
-
-
-
EU-25
-
-
EU-15
0.79
China2
-
-
Israel2
-
1.03
Russian Federation
-
-
b
0.95
-
0.25
0.34
-
c
1.74
a
-
-
0.53
h
0.44
h
0.32
h
0.19
h
0.19
h,n
0.18
0.28
b
0.22
a,b
0.16
a,b
0.11
b
0.11
b,n
-
0.11
b
0.09
b
-
-
a,b
0.12
b
0.10
b
-
-
0.04
a,s
-
-
c
0.34
c
0.34
c
-
-
0.44
-
b
0.16
-
0.30
0.40
n
b
a
1.75
b,h,n
0.08
0.01
1.74
Turkey2
n
0.05
-
Switzerland
-
-
-
0.34
s
0.08
2.27
b
-
0.08
2.21
a
0.11
0.02
0.42
j
b
-
0.43
-
0.43
a
b,n
-
0.08
0.28
r
c,q
0.08
0.33
0.04 n
0.06
-
0.06
-
1.77
-
0.04
c,q
0.74
-
0.08
-
0.02
-
Slovak Republic
n
0.04
-
Portugal3, 4
0.10
-
-
-
0.09
0.02
Luxembourg2
a
0.05
-
Korea
j
b
0.08
-
j
-
1.86
-
-
b
1.37
Poland
j
-
0.06
s
Japan
Norway
2.05
0.04
-
-
0.43
New Zealand
0.40
p
-
0.02
-
0.25
Italy
Netherlands
0.52
a
1.57
a
0.28 b
0.02
1.32
r
b,j,q
1.60
b
2003
0.09
0.61
-
2002
0.08
0.45
a
2001
-
Finland
a
a
1995
0.06
Denmark
0.97
b,p
1991
b,h
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1998 instead of 2001.
3. 1982 instead of 1981.
2. 2000 instead of 2001.
4. 1992 instead of 1991.
Source: OECD, MSTI database, May 2004.
5. 1996 instead of 1995.
StatLink: http://dx.doi.org/10.1787/348312071533
203
© OECD 2004
As a percentage of value added in industry
Australia
Belgium
Czech Republic
Canada
Denmark
Finland
France
Germany
Ireland
Italy
1991
2000
1992
2001
1991
2000
1992
2001
1991
1999
1991
2001
1991
2000
1991
2001
1991
1999
1991
5.2
7.7
3.6
4.1
2.8
2.1
4.4
6.0
5.6
9.4
7.2
6.9
6.5
7.7
2.1
2.2
2.9
2001 2.4
1.4
1.7
0.4
0.4
0.3
0.1
1
1.5
1.5
3.1
2.3
1.0
1.2
0.7
0.7
1.2
1.0
0.3
0.4 0.1
Total manufacturing
(15-37)
2.9
3.3
Food prod., beverages and tobacco
(15-37)
1.0
1.0
1
1.2
3.6
1.1
1.1
2.5
0.4
1
0.5
0.8
1.8
2.6
0.5
1.0
1.1
2.3
1.3
1.0
0.0
0.8
1.1
0.7
0.4
0.4
0.0
1
0.3
0.3
2.4
1.3
0.3
0.3
0.4
0.3
0.2
0.2
0.0
0.1
2.6
1
10.3
17.5
9.3
12.2
9.8
9.4
9.0
10.1
2.6
1.3
4.9
3.5
0.0
0.0
4.9
5.8
5.6
2.4
2.7
0.8
-
-
2.0
1.9
15.7
23.7
13.8
17.6
14.1
13.9
12.6
15.0
2.8
1.2
7.3
4.8
Textiles, textile prod., leather and footwear
(17-19)
0.3
0.8
1
Wood, pulp, paper, paper prod., printing & publishing
(20-22)
0.6
0.8
1
4.4
1
7.3
2.9
5.8
1.6
3.7
0.3
1
12.0
17.8
4.5
6.6
3.4
4.2
1
Chemical, rubber, plastics and fuel prod.
(23-25)
3.8
Coke, refined petroleum prod. and nuclear fuel
(23)
0.9
1.1
1
Chemicals and chemical prod.
(24)
5.7
6.9
1
….Chemicals excluding pharmaceuticals
(24ex2423)
-
-
….Pharmaceuticals
(2423)
-
-
Rubber and plastics prod.
(25)
2.2
1.5
1
10.2
14.0
3.8
4.0
3.6
10.3
-
2.4
2.1
-
2.9
1
4.4
8.1
11.6
7.0
10.7
7.1
11.4
12.1
1.1
0.4
4.4
3.2
18.6
-
11.4
23.9
-
10.3
1
28.2
33.6
20.5
63.7
22.1
26.3
18.3
24.1
10.5
4.5
12.0
7.0
1.1
1
1.0
4.4
4.1
6.0
3.7
5.1
2.2
3.4
1.2
2.6
1.5
1.3
4.3
4.4
0.6
0.8
3.8
Other non-metallic mineral prod.
(26)
1.2
0.8
1
1.7
2.9
0.5
0.2
0.7
0.6
1
2.1
1.2
2.0
1.7
1.7
2.4
1.9
2.2
1.1
1.1
0.2
Basic metals and fabricated metal prod.
(27-28)
2.5
2.2
1
2.2
3.3
1.9
1.1
2.5
1.0
1
1.6
1.0
3.8
3.6
1.7
1.4
1.3
1.5
1.3
1.4
0.8
0.3
Machinery and equipment
(29-33)
9.3
9.6
1
12.6
16.5
13.1
17.7
5.0
2.2
1
8.3
9.5
12.6
19.8
13.5
12.9
8.7
9.4
4.5
6.0
5.2
4.7
0.3
Machinery and equipment, n.e.c.
(29)
3.8
5.1
1
5.4
6.5
1.6
2.1
3.8
2.8
1
5.4
7.1
5.7
7.3
4.2
5.3
5.4
6.3
2.0
3.6
1.6
1.8
Electrical and optical equipment
(30-33)
14.9
13.6
1
18.4
24.7
22.0
30.5
7.2
1.8
1
12.9
12.4
22.8
25.9
19.8
17.5
11.7
13.0
5.1
6.3
9.1
8.5
….Office, accounting and computing machinery
(30)
-
-
-
-
61.4
38.1
-87.5
0.5
1
14.2
13.9
11.1
23.4
16.1
13.4
13.1
22.0
2.3
1.7
43.5
9.8
….Electrical machinery and apparatus, nec
(31)
-
-
-
-
2.2
5.6
2.9
1.2
1
4.8
8.1
9.4
14.6
5.8
6.8
6.1
3.8
3.8
6.4
4.1
2.4
….Radio, television and communication equip.
(32)
-
-
-
-
26.5
36.4
28.5
3.3
1
19.5
13.0
46.5
30.2
25.3
33.2
27.5
45.4
23.5
14.1
18.3
21.0
….Medical, precision and optical instruments
(33)
-
-
-
-
-
-
10.3
1.9
1
16.5
15.6
20.6
11.0
34.9
16.5
12.5
10.9
2.0
4.2
1.7
5.5
10.3
1
2.0
6.4
5.4
4.4
26.1
17.1
16.0
18.0
3.0
3.1
16.4
12.1
Transport equipment
(34-35)
6.2
6.7
1
-
-
0.9
1.4
4.0
10.7
1
-
-
5.7
3.7
13.2
13.8
13.1
18.4
6.9
5.9
15.5
12.1
-
-
15.5
10.7
31.3
8.4
1
3.1
9.9
5.1
4.8
61.3
24.8
32.3
15.7
0.4
1.4
18.0
12.0
0.0
1
2.6
13.2
2.7
2.1
1.1
1.9
4.2
1.5
0.0
3.1
2.3
0.9
18.5
1
-
-
0.9
8.1
112.0
32.5
51.2
20.2
-
-
32.5
24.3
5.4
0.6
17.4
16.9
8.4
6.6
14.7
9.9
0.4
0.0
6.3
4.0
4.9
1.4
1.0
2.8
0.5
2.5
1.3
1.8
0.3
0.9
0.1
0.2
Motor vehicles, trailers and semi-trailers
(34)
5.8
8.1
1
Other transport equipment
(35)
7.4
4.0
1
….Building and repairing of ships and boats ….Aircraft and spacecraft
(351) (353)
-
-
2.7
-
-
-
4.8
-
5.4
23.7
3.8
14.0
6.8
-
(352+359)
-
-
-
-
-
-
-
3.4
1
Manufacturing nec; recycling
(36-37)
-
-
3.0
2.2
-
-
1.3
0.9
1
Electricity, gas and water supply
(40-41)
0.4
0.2
0.1
0.7
1.1
0.7
0.0
0.0
0.1
0.2
2.6
2.0
1.2
1.6
0.3
0.2
-
-
0.7
0.1
Construction
(45)
0.0
0.1
0.3
0.4
0.0
0.1
0.1
0.1
0.2
0.1
0.2
0.6
0.2
0.2
0.1
0.1
-
-
0.0
0.0
Total services5
(50-99)
0.3
0.4
0.2
0.3
0.3
0.4
1.1
0.5
0.4
0.9
0.2
0.5
0.1
0.2
0.1
0.2
0.2
0.4
0.1
0.2
Wholesale and retail trade; restaurants and hotels
(50-55)
-
-
0.1
0.1
-
-
-
0.1
-
-
-
-
-
0.0
-
-
-
0.0
0.0
0.0
Transport and storage and communication
….Railroad equip. and transport equip. n.e.c.
(60-64)
-
-
0.0
0.6
0.4
0.1
0.1
0.1
-
-
0.3
1.6
-
-
-
-
0.5
1.6
0.0
0.0
Transport and storage
(60-63)
-
-
-
-
0.1
0.1
0.1
-
-
-
0.0
0.2
0.1
1.8
-
0.6
0.0
-
0.0
0.0
Post and telecommunications
(64)
-
-
-
-
0.8
0.2
0.0
-
1.5
4.8
1.0
4.7
-
-
-
-
1.1
-
0.2
0.0
(65-74)
-
-
0.6
0.6
0.6
0.9
3.1
1.3
-
1.7
-
-
-
-
-
-
-
0.8
0.3
0.4
(65-67)
-
-
0.5
0.2
0.4
0.2
0.0
0.0
-
0.7
-
-
-
-
-
-
-
0.0
0.0
0.2
Finance, insurance, real estate and business services Financial intermediation Real estate, renting and business activities
(70-74)
-
-
0.6
0.7
0.7
1.2
5.0
1.7
1.2
2.0
-
-
0.3
0.3
-
0.5
-
1.0
0.4
0.5
….Real estate activities
(70)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
….Renting of m&eq and other business activities
(71-74)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
……..….Other business activities
(74)
-
-
-
-
-
-
3.0
-
3.4
1.7
-
0.3
-
0.5
-
-
-
-
-
0.2
Community social and personal services
© OECD 2004
-
-
0.0
0.0
-
-
0.0
0.2
-
-
-
0.1
-
-
-
-
-
0.0
0.0
0.0
High-technology manufactures
16.5
15.5
1
-
-
24.9
29.3
36.3
5.2
1
21.7
23.5
27.2
29.2
35.8
25.9
21.0
22.6
6.2
5.9
15.0
12.7
Medium-high technology manufactures
4.5
5.2
1
-
-
1.6
2.0
4.7
4.8
1
4.8
7.1
7.8
8.4
8.6
8.6
8.8
10.7
1.8
1.1
4.8
3.6
Medium-low technology manufactures
2.3
1.9
1
-
-
2.0
1.0
2.3
0.9
1
1.6
2.4
3.6
3.7
2.4
2.4
1.6
2.0
1.2
1.6
0.9
0.5
0.3
1
1.5
1.0
2.4
1.6
0.6
1.0
0.7
0.8
0.8
0.6
0.1
0.2
4.8
1
9.3
13.3
11.7
18.3
16.7
14.3
11.2
13.0
3.8
3.3
7.5
6.0
Low-technology manufactures High- and medium-high technology manufactures
(75-99)
7.3
7.9
1.3 1
10.0
1.9 14.6
0.6 8.0
0.5 9.6
1.1 5.2
1. Intensity of the previous year.
4. OECD includes previous EU countries and Canada, Japan, and the United States.
2. 1998 instead of 1995.
5. Due to differences in data reporting methodologies, service sector R&D figures are not fully comparable across countries.
3. EU includes the 15 EU Members before 1 May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available).
Source: OECD, STAN Indicators 2004.
StatLink: http://dx.doi.org/10.1787/052066133807
OECD Science, Technology and Industry Outlook 2004
204 Table 13. Intensity in business R&D expenditures by sector, 1991 and 2001 or nearest years available
© OECD 2004
Table 13. Intensity in business R&D expenditures by sector, 1991 and 2001 or nearest years available (cont'd) As a percentage of value added in industry
Korea 1995
Netherlands
2001
1991
2000
Norway 1991
Poland
1998
1994
Spain
2001
1991
Sweden
2001
1991
2001
UK 1991
EU3
US
2001
1991
2000
1992
OECD4
1999
1991
1999
Total manufacturing
(15-37)
5.2
6.0
5.1
5.7
5.1
4.1
1.2
1.0
1.9
1.8
9.8
15.7
5.7
6.6
8.5
8.5
5.3
5.7
83.9
76.8
Food prod., beverages and tobacco
(17-19)
0.9
0.9
1.8
2.4
1.2
1.5
0.1
0.1
1
0.3
0.7
1.6
1.1
1.2
1.5
1.1
1.1
0.9
0.9
1.5
1.3
Textiles, textile prod., leather and footwear
(20-22)
0.6
1.1
0.7
1.0
0.9
1.8
0.5
0.4
1
0.1
0.6
0.9
1.2
0.3
0.5
0.5
0.5
0.4
0.6
0.5
0.4
Wood, pulp, paper, paper prod., printing & publishing
(23-25)
0.6
0.5
0.2
0.3
0.8
0.9
0.1
0.1
1
0.2
0.2
1.7
1.7
0.3
0.1
1.0
1.6
0.4
0.4
1.1
1.3
Chemical, rubber, plastics and fuel prod.
(23)
3.4
2.8
10.7
8.1
11.6
7.5
1.7
1.3
1
2.8
3.0
14.9
23.3
11.4
14.9
10.3
9.1
8.6
9.2
18.1
15.9
Coke, refined petroleum prod. and nuclear fuel
23
1.3
0.7
6.1
2.0
-
-
1.2
0.6
1
1.0
1.0
0.9
3.1
12.7
9.6
8.7
3.1
4.5
4.0
1.7
0.5
Chemicals and chemical prod.
(24)
5.2
5.3
13.9
10.6
-
-
2.3
2.3
1
4.3
4.7
20.8
30.7
15.8
23.1
12.9
12.6
12.5
12.9
14.9
14.0
….Chemicals excluding pharmaceuticals
(24ex2423)
6.1
5.5
12.1
7.2
-
-
-
1.8
1
2.7
2.0
6.9
6.5
8.4
5.6
9.2
8.0
8.9
7.3
8.1
5.9
….Pharmaceuticals
(2423)
2.9
4.8
27.5
25.4
42.7
19.6
-
3.9
1
7.2
10.4
39.5
45.5
32.9
50.0
22.2
20.2
21.9
25.3
6.8
8.1
Rubber and plastics prod. Other non-metallic mineral prod. Basic metals and fabricated metal prod. Machinery and equipment
(25)
2.4
2.6
1.7
1.6
1.3
3.5
1.1
0.5
1
1.1
1.2
2.8
2.3
0.7
0.6
3.4
2.9
1.9
2.6
1.5
1.5
(26)
1.4
1.1
0.4
1.0
1.9
1.6
0.2
0.2
1
0.4
0.4
1.3
1.2
1.2
0.8
2.0
2.2
1.1
1.3
1.0
0.7
0.5
1
0.7
0.7
1.9
2.6
0.9
0.7
1.6
1.6
1.3
1.2
2.9
2.0
2.5
1
5.3
3.6
21.0
38.1
9.1
10.2
13.6
16.5
9.1
9.1
35.9
35.0
(27-28) (29-33)
1.8
1.2
10.7
18.1
1.4 11.6
1.5 17.9
4.7 15.0
3.0
0.7
11.2
2.8
Machinery and equipment, n.e.c.
(29)
5.1
5.3
2.1
9.1
6.9
6.1
2.6
2.5
1
1.8
2.4
9.6
10.0
5.3
8.1
3.9
5.5
4.6
4.9
5.6
5.6
Electrical and optical equipment
(30-33)
12.7
22.8
18.2
25.4
23.6
16.4
3.1
2.4
1
8.1
4.8
35.4
89.1
11.7
11.5
18.4
21.4
13.1
12.8
30.3
29.4
….Office, accounting and computing machinery
(30)
10.1
21.5
31.3
257.7
34.5
20.8
0.3
1.4
1
11.4
4.6
19.1
18.3
13.4
4.2
40.0
30.7
-
15.4
7.9
5.2
….Electrical machinery and apparatus, nec
(31)
5.1
10.5
40.4
7.8
6.8
4.5
2.7
2.1
1
3.0
2.4
12.5
7.6
11.8
10.4
8.4
9.6
-
4.3
5.1
3.9 12.6
….Radio, television and communication equip.
(32)
15.0
29.0
14.0
0.5
71.2
54.1
5.5
5.3
1
16.0
12.6
82.1
-862.9
14.7
18.5
15.9
18.6
-
25.7
11.1
….Medical, precision and optical instruments
(33)
4.0
4.9
-
-
10.1
6.5
1.4
1.0
1
6.7
3.4
3.9
25.8
7.7
8.8
16.9
30.2
-
11.4
6.2
7.8
(34-35)
11.3
6.7
7.4
3.9
2.0
2.5
3.6
3.2
1
4.8
4.7
17.5
24.3
14.3
14.7
25.4
16.2
15.2
15.5
22.4
19.7
Motor vehicles, trailers and semi-trailers
(34)
12.3
7.5
14.7
5.9
4.5
9.2
2.5
2.7
1
3.5
2.8
17.9
25.2
10.4
10.3
22.8
15.4
-
13.6
11.3
12.1
Other transport equipment
(35)
7.0
5.4
3.6
1.4
1.8
1.7
4.5
3.8
1
9.8
13.3
16.4
20.6
18.4
19.3
27.3
17.5
-
21.0
11.0
7.5
….Building and repairing of ships and boats
(351)
4.0
-
-
1.9
1.7
1.5
-
1.6
1
3.1
7.4
5.5
3.1
2.0
6.2
-
-
-
3.5
0.1
0.1
….Aircraft and spacecraft
(353)
49.9
-
-
0.6
1.8
13.5
-
9.0
1
35.9
27.9
25.6
29.7
22.8
21.2
31.7
20.8
-
31.6
10.5
6.8
….Railroad equip. and transport equip. n.e.c.
(352+359)
3.0
-
-
1.7
3.4
0.8
-
4.6
1
1.8
6.5
5.5
11.0
3.9
28.2
-
-
-
8.9
0.4
0.6
Manufacturing nec; recycling
(36-37)
0.6
3.6
-
0.4
-
-
0.2
0.3
1
0.3
0.6
1.5
1.2
0.7
0.5
-
1.3
-
0.9
-
0.6
Electricity, gas and water supply
(40-41)
1.8
0.9
0.1
0.4
0.0
-
0.1
0.2
0.4
0.2
1.5
0.5
1.3
0.6
0.2
0.1
-
-
-
-
Construction
(45)
1.1
0.8
0.1
0.2
0.1
-
0.2
0.1
0.0
0.1
-
0.2
0.1
0.1
-
0.1
-
-
-
-
0.4
0.7
0.9
0.2
0.2
14.4
20.8
Transport equipment
Total services
5
(50-99)
0.5
0.1
0.6
0.7
0.1
0.1
0.1
0.3
0.3
0.6
0.3
Wholesale and retail trade; restaurants and hotels
(50-55)
0.0
2
0.1
-
-
-
0.0
1
0.0
0.0
0.0
0.0
-
0.0
-
-
-
-
-
-
-
Transport and storage and communication
(60-64)
1.5
2
1.0
-
0.4
0.2
0.7
1
0.2
0.3
0.2
0.5
-
0.6
-
1.0
-
-
-
-
-
-
(60-63)
0.0
2
0.0
-
0.1
0.0
0.1
1
-
-
0.0
-
-
0.0
-
0.0
-
0.1
-
-
-
-
Transport and storage
0.3
0.3
-
(64)
4.5
2
2.9
-
0.9
1.0
2.7
1
-
-
0.6
-
-
1.9
1.9
2.5
-
-
-
-
-
(65-74)
0.5
2
1.0
-
0.6
2.0
2.0
1
0.2
0.1
0.4
0.7
-
1.5
-
-
-
-
-
-
-
-
(65-67)
0.0
2
0.0
-
0.4
0.2
0.2
1
0.0
0.0
0.0
0.1
-
1.1
-
-
-
0.5
-
-
-
-
Real estate, renting and business activities
(70-74)
0.7
2
1.6
-
0.7
2.8
2.6
1
0.2
0.1
0.5
1.0
-
1.5
1.0
0.7
-
-
-
-
-
-
….Real estate activities
(70)
-
2
-
-
-
-
-
1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
….Renting of m&eq and other business activities
(71-74)
-
2
-
-
-
-
-
1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
……..….Other business activities
(74)
-
2
-
-
0.4
2.1
1.0
1
-
-
-
-
-
0.1
-
0.4
-
-
-
-
-
-
0.1
2
1
0.1
0.1
0.0
0.0
-
0.0
0.0
0.0
-
-
-
-
-
-
Post and telecommunications Finance, insurance, real estate and business services Financial intermediation
Community social and personal services
(75-99)
0.0
0.2
0.0
-
0.0
High-technology manufactures
12.5
-
13.2
26.1
34.4
24.6
-
3.5
1
11.6
10.3
39.9
81.1
18.9
23.1
23.6
22.5
-
22.0
42.4
40.4 28.1
Medium-high technology manufactures
8.3
-
11.7
7.7
-
-
-
2.3
1
2.8
2.5
11.6
14.5
8.2
8.7
9.7
9.8
-
7.7
30.6
Medium-low technology manufactures
1.8
-
1.8
1.5
-
-
-
0.5
1
0.8
0.9
2.0
2.5
2.3
1.6
2.9
2.1
-
1.7
7.3
4.8
Low-technology manufactures
0.7
1.0
-
1.2
-
-
0.2
0.2
1
0.3
0.5
1.6
1.5
0.7
0.7
-
1.3
-
0.7
-
3.6
2.6
1
4.9
4.2
20.0
32.0
12.1
14.5
16.0
15.6
11.3
11.6
73.2
68.6
High- and medium-high technology manufactures
9.7
11.3
11.9
13.1
-
-
2.9
4. OECD includes previous EU countries and Canada, Japan, and the United States.
2. 1998 instead of 1995.
5. Due to differences in data reporting methodologies, service sector R&D figures are not fully comparable across countries.
3. EU includes the 15 EU Members before 1 May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available).
Source: OECD, STAN Indicators 2004.
205
Statistical Annex
1. Intensity of the previous year.
As a percentage of total R&D expenditures
(ISIC Rev.3)
Australia
Belgium
Canada
Czech Republic
Denmark
Finland
France
Germany
Ireland
Italy
1991
2000
1992
2001
1991
2001
1992
2001
1991
1999
1991
2001
1991
2000
1991
2001
1991
1999
1991
2001
Total business sector
(01-99)
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Total manufacturing
(15-37)
62.8
50.4
84.9
82.9
66.7
69.8
59.3
68.3
69.4
60.4
85.3
84.6
92.1
85.0
95.4
90.9
84.7
74.9
89.8
79.4
Food prod., beverages and tobacco
(15-16)
4.0
3.5
3.0
2.4
1.3
0.7
1.0
0.4
4.6
2.5
6.6
1.4
1.8
2.0
0.8
0.8
12.3
5.6
0.9
1.2
Textiles, textile prod., leather and footwear
(17-19)
0.4
0.7
1.3
2.1
1.0
0.7
6.6
0.7
0.4
0.2
1.0
0.4
0.5
0.6
0.6
0.6
2.3
0.5
0.2
0.6
Wood, pulp, paper, paper prod., printing & publishing
(20-22)
Chemical, rubber, plastics and fuel prod.
1.9
1.4
1.1
1.1
2.3
1.4
0.6
0.1
0.6
0.5
9.4
3.1
0.4
0.3
0.5
0.3
1.0
1.2
0.1
0.4
(23-25)
12.7
9.5
37.5
39.7
11.7
8.4
7.7
7.1
21.5
28.7
17.7
11.5
20.6
22.6
19.8
19.8
20.7
15.1
20.0
15.7
Coke, refined petroleum prod. and nuclear fuel
(23)
0.5
0.3
2.8
1.0
3.0
0.4
1.4
0.1
0.0
0.0
2.2
0.8
2.0
1.3
0.2
0.2
0.0
0.0
1.3
0.7
Chemicals and chemical prod.
(24)
10.1
8.4
32.0
36.8
8.2
7.3
4.1
5.9
20.8
26.5
13.7
8.9
16.5
18.6
18.1
17.7
19.1
13.6
16.9
13.2
….Chemicals excluding pharmaceuticals
(24ex2423)
5.1
1.6
21.7
16.0
3.4
1.8
3.2
3.2
3.0
3.5
8.7
2.9
8.9
6.1
13.4
10.9
6.3
3.1
6.1
5.1
….Pharmaceuticals
(2423)
5.0
6.8
10.3
20.9
4.8
5.6
0.9
2.7
17.8
23.0
4.9
6.0
7.7
12.4
4.7
6.8
12.8
10.5
10.8
8.1
(25)
2.0
0.9
2.8
1.9
0.5
0.6
2.2
1.1
0.7
2.2
1.9
1.7
2.1
2.7
1.5
2.0
1.5
1.5
1.8
1.8
Other non-metallic mineral prod.
Rubber and plastics prod.
(26)
1.3
0.6
1.5
1.7
0.3
0.1
1.0
2.6
1.5
0.6
1.3
0.5
1.1
1.3
1.0
0.9
1.7
0.9
0.5
0.6
Basic metals and fabricated metal prod.
(27-28)
10.0
4.3
5.4
4.8
4.3
2.8
8.0
4.0
2.6
1.1
6.2
3.5
2.9
2.3
2.4
2.3
2.3
1.1
3.3
1.4
(29-33)
20.4
19.9
29.3
25.7
32.3
44.7
19.8
14.2
31.7
23.9
38.5
62.2
33.6
30.3
38.8
31.7
40.9
48.2
34.6
33.7
Machinery and equipment, n.e.c.
(29)
4.2
4.0
5.5
4.5
1.8
2.3
10.0
7.4
12.6
10.0
10.5
7.6
4.3
4.8
11.4
11.2
3.5
2.9
5.8
7.0
Electrical and optical equipment
(30-33)
16.2
15.9
23.8
21.2
30.5
42.4
9.8
6.8
19.2
13.9
28.1
54.5
29.3
25.5
27.3
20.5
37.4
45.3
28.8
26.7
Machinery and equipment
….Office, accounting and computing machinery
(30)
2.1
1.9
0.3
0.3
6.1
4.1
0.2
0.0
1.5
0.8
0.9
0.2
3.5
1.5
3.9
1.9
8.3
5.1
6.8
1.1
….Electrical machinery and apparatus, nec
(31)
2.6
1.4
4.9
2.2
1.0
2.3
3.0
2.4
2.6
2.9
4.9
4.4
3.0
3.5
7.3
3.0
4.4
4.7
5.9
3.4
….Radio, television and communication equip.
(32)
9.4
9.9
16.1
17.5
22.2
33.7
5.0
2.9
7.3
4.0
16.8
47.5
8.1
13.7
10.1
10.7
21.5
30.6
14.7
18.3
….Medical, precision and optical instruments
(33)
2.2
2.7
2.5
1.2
1.2
2.3
1.5
1.4
7.9
6.1
5.4
2.4
14.7
6.8
6.0
4.9
3.3
5.0
1.3
4.0
(34-35)
10.5
9.1
4.2
4.7
13.0
10.6
13.4
38.9
1.3
1.9
3.9
1.4
31.0
24.5
30.8
33.9
3.0
1.6
30.2
25.4
Transport equipment Motor vehicles, trailers and semi-trailers
(34)
6.7
7.9
2.3
2.6
1.4
2.6
7.1
34.8
0.0
0.5
1.5
0.4
11.5
13.8
21.4
29.8
2.7
1.2
18.3
14.0
Other transport equipment
(35)
3.8
1.2
1.9
2.1
11.5
8.0
6.3
4.2
1.3
1.5
2.4
1.0
19.5
10.7
9.4
4.1
0.2
0.4
12.0
11.4
….Building and repairing of ships and boats
(351)
1.9
0.7
0.0
0.0
0.0
0.0
0.0
0.0
0.9
1.5
0.8
0.3
0.1
0.1
0.3
0.1
0.0
0.1
0.4
0.2
….Aircraft and spacecraft
(353)
1.2
0.1
1.4
1.8
11.5
7.8
4.1
2.8
0.0
0.0
0.1
0.3
18.9
10.2
8.2
3.6
0.0
0.4
10.6
10.2
….Railroad equip. and transport equip. n.e.c.
(352+359)
0.6
0.5
0.5
0.3
0.0
0.2
2.2
1.4
0.4
0.0
1.6
0.4
0.5
0.4
1.0
0.5
0.2
0.0
1.0
1.0
Manufacturing nec; recycling
(36-37)
-
-
1.6
0.8
0.6
0.4
1.3
0.3
5.3
0.9
0.5
0.6
0.3
1.1
0.6
0.6
0.4
0.6
0.2
0.3
Electricity, gas and water supply
(40-41)
2.2
0.7
0.2
1.0
4.4
1.5
0.1
0.0
0.3
0.3
4.5
1.4
1.9
2.1
0.4
0.2
-
-
2.0
0.5
Construction
(45)
0.3
0.9
1.4
1.0
0.2
0.4
0.5
1.2
0.8
0.2
1.1
1.2
0.8
0.6
0.3
0.2
-
-
0.0
0.2
Total services3
(50-99)
27.1
39.9
13.3
13.7
25.5
26.4
38.8
29.8
28.5
38.9
7.6
12.4
4.2
10.6
3.5
8.4
13.5
24.6
8.1
19.9
Wholesale and retail trade; restaurants and hotels Wholesale and retail trade; repairs Hotels and restaurants
(50-55)
-
-
1.3
1.0
-
-
-
1.2
-
-
-
-
-
0.0
-
-
-
0.0
0.0
0.6
(50-52)
-
-
1.3
1.0
4.0
4.4
-
1.2
5.5
7.5
-
0.1
-
0.0
-
-
-
0.0
0.0
0.6
(55)
-
-
0.0
0.0
-
-
-
0.0
-
-
-
-
-
0.0
-
-
-
0.0
0.0
0.0
(60-64)
-
-
0.2
2.5
3.3
0.8
0.3
0.9
-
-
1.9
6.4
-
-
-
-
4.2
9.2
0.4
0.2
Transport and storage
(60-63)
-
-
0.1
1.0
0.4
0.3
0.3
0.8
-
-
0.1
0.5
0.3
5.2
-
1.1
0.2
0.0
0.0
0.1
Post and telecommunications
(64)
-
-
0.1
1.5
2.9
0.5
0.0
0.1
2.9
6.8
1.8
5.9
-
-
-
-
4.0
9.2
0.4
0.1
11.6
9.8
18.3
Transport and storage and communication
Finance, insurance, real estate and business services
(65-74)
-
-
Financial intermediation
(65-67)
-
-
2.4
0.7
2.9
1.6
0.0
0.0
-
2.2
-
-
-
-
-
-
-
0.0
0.0
2.5
Real estate, renting and business activities
(70-74)
-
-
9.2
9.1
15.3
19.7
38.5
23.8
20.0
22.5
-
-
4.0
5.5
-
6.9
-
15.3
7.5
16.6
……..Other business activities
(74)
-
-
4.5
5.0
2.4
3.1
9.2
1.8
15.9
5.6
-
0.5
-
2.9
-
-
-
1.5
0.5
2.2
Community social and personal services
(75-99)
High-technology manufactures
HTM
21.3
38.5
23.8
-
24.6
-
-
-
-
-
-
-
15.3
7.5
19.1
-
-
0.1
0.4
-
-
0.0
3.9
-
-
-
1.0
-
-
-
-
-
0.0
0.2
0.0
19.9
21.4
30.6
41.7
45.8
53.5
11.7
9.8
34.3
34.0
28.2
56.4
52.8
44.6
32.9
27.9
45.9
51.5
44.2
41.6 30.5
© OECD 2004
Medium-high technology manufactures
MHTM
19.2
15.4
34.9
25.5
7.6
9.1
25.6
49.2
18.6
16.9
27.1
15.8
28.1
28.6
54.5
55.3
17.2
11.8
37.1
Medium-low technology manufactures
MLTM
15.8
6.8
12.5
9.3
8.1
3.9
12.6
7.8
5.6
5.4
12.4
6.9
8.2
7.8
5.5
5.4
5.6
3.6
7.2
4.8
Low-technology manufactures
LTM
-
-
7.0
6.4
5.2
3.3
9.4
1.5
10.9
4.1
17.5
5.5
2.9
4.0
2.5
2.3
16.1
8.0
1.3
2.5
High- and medium-high technology manufactures
HMHTM
41.0
37.4
65.4
67.2
53.5
62.6
37.3
59.1
53.8
52.4
56.1
72.5
81.1
73.3
87.7
83.2
63.0
63.4
81.8
72.3
1. EU includes the 15 EU Members before 1May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available). 2. OECD includes previous countries and Canada, Japan, and the United States. 3. Due to differences in data reporting methodologies, service sector R&D figures are not fully comparable across countries.
Source: OECD, STAN Indicators 2004.
StatLink: http://dx.doi.org/10.1787/581868456165
OECD Science, Technology and Industry Outlook 2004
206 Table 14. Business R&D expenditures by sector, 1991 and 2001 or nearest years available
© OECD 2004
Table 14. Business R&D expenditures by sector, 1991 and 2001 or nearest years available (cont'd) As a percentage of total R&D expenditures
(ISIC Rev.3)
Korea
Netherlands
Norway
Poland
Spain
Sweden
United Kingdom
EU1
Unites States
OECD2
1995
2001
1991
2000
1991
1998
1994
2001
1991
2001
1991
2001
1991
2001
1991
2000
1992
1999
1991
1999
Total business sector
(01-99)
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Total manufacturing
(15-37)
83.3
82.8
89.7
75.9
63.3
54.4
71.9
69.4
78.4
60.0
87.9
87.4
79.7
79.2
75.7
64.9
87.9
84.3
83.9
76.8
Food prod., beverages and tobacco
(15-16)
1.4
1.4
5.6
5.8
2.5
2.9
1.5
4.7
2.4
3.1
1.4
0.5
2.4
2.5
1.1
0.8
1.8
1.7
1.5
1.3
Textiles, textile prod., leather and footwear
(17-19)
0.7
0.7
0.4
0.3
0.3
0.4
3.7
1.8
0.5
1.5
0.1
0.1
0.3
0.2
0.2
0.1
0.5
0.5
0.5
0.4
Wood, pulp, paper, paper prod., printing & publishing
(20-22)
0.5
0.3
0.5
0.5
2.1
2.3
0.7
0.9
0.8
0.7
3.3
2.0
0.5
0.3
1.2
1.6
0.7
0.7
1.1
1.3
Chemical, rubber, plastics and fuel prod.
(23-25)
10.6
9.3
37.6
21.4
17.4
11.3
16.2
14.9
18.4
17.1
17.0
20.1
28.4
30.4
15.7
12.1
22.3
22.6
18.1
15.9
Coke, refined petroleum prod. and nuclear fuel
0.7
1.6
1.6
2.3
0.6
1.3
1.0
0.1
0.2
4.5
2.0
2.1
0.6
1.3
0.8
1.7
0.5
Chemicals and chemical prod.
(24)
8.1
7.0
33.9
20.1
15.4
8.7
11.0
12.8
15.2
14.1
16.2
19.5
23.4
28.1
12.5
10.7
19.7
20.0
14.9
14.0
….Chemicals excluding pharmaceuticals
(24ex2423)
(23)
6.7
1.3
4.8
1.1
26.2
2.7
11.2
8.4
4.3
8.8
7.0
6.3
4.3
3.1
1.6
8.7
4.1
6.5
4.2
10.1
7.8
8.1
5.9
….Pharmaceuticals
(2423)
1.4
2.2
7.7
8.9
7.0
4.4
2.3
5.8
8.8
9.8
13.1
17.9
14.7
24.0
6.0
6.5
9.5
12.2
6.8
8.1
Rubber and plastics prod.
(25)
1.3
1.3
1.1
0.7
0.4
1.0
2.9
1.5
1.9
2.0
0.7
0.4
0.4
0.4
1.1
0.8
1.4
1.8
1.5
1.5
Other non-metallic mineral prod.
(26)
1.0
0.5
0.3
0.6
0.9
0.8
0.9
0.9
1.3
1.1
0.4
0.2
0.5
0.3
0.4
0.4
0.9
0.9
1.0
0.7
Basic metals and fabricated metal prod.
(27-28)
3.6
1.8
3.2
2.3
7.3
5.6
5.4
4.3
3.2
2.8
2.3
2.0
1.4
0.9
1.4
1.3
2.6
2.2
2.9
2.0
Machinery and equipment
(29-33)
41.1
51.3
36.3
42.0
29.7
26.3
26.4
28.9
31.5
16.9
43.9
43.4
25.8
25.2
31.5
33.0
34.0
30.5
35.9
35.0
Machinery and equipment, n.e.c.
(29)
5.1
4.1
2.8
9.9
7.0
7.3
13.9
14.2
4.8
5.7
11.2
7.4
6.0
7.7
3.0
3.4
7.9
7.5
5.6
5.6
Electrical and optical equipment
(30-33)
36.0
47.2
33.5
32.1
22.7
19.0
12.5
14.7
26.7
11.2
32.7
36.0
19.7
17.5
28.5
29.6
26.0
23.0
30.3
29.4
….Office, accounting and computing machinery
(30)
7.8
4.1
25.7
1.0
0.0
0.2
5.9
1.1
0.8
4.0
0.8
9.6
….Electrical machinery and apparatus, nec
(31)
1.9
1.8
15.6
1.6
3.4
2.4
5.4
6.6
4.3
2.8
3.1
1.6
6.4
4.6
2.6
1.9
5.7
3.1
5.1
3.9
….Radio, television and communication equip.
(32)
31.6
36.2
12.8
0.3
15.6
13.5
5.8
6.0
13.1
5.7
26.6
28.9
5.9
8.2
8.8
12.9
10.8
12.6
11.1
12.6
….Medical, precision and optical instruments
1.8
1.8
2.2
5.2
3.7
2.5
7.9
5.2
(33)
0.7
1.4
1.0
4.5
2.0
2.1
1.3
1.9
3.5
1.5
1.0
4.8
3.4
3.8
7.4
9.6
5.8
4.7
6.2
7.8
(34-35)
24.1
16.8
5.8
2.7
3.1
4.6
16.6
12.0
19.7
16.0
19.1
19.0
20.2
19.1
23.5
15.1
24.6
24.8
22.4
19.7
Motor vehicles, trailers and semi-trailers
(34)
21.1
11.5
4.0
2.2
0.5
1.8
5.2
5.6
11.4
7.8
13.9
15.9
7.4
6.9
8.9
9.3
13.9
16.1
11.3
12.1
Other transport equipment
(35)
3.0
5.3
1.8
0.4
2.6
2.8
11.4
6.5
8.3
8.3
5.3
3.1
12.8
12.2
14.6
5.8
10.7
8.7
11.0
7.5
….Building and repairing of ships and boats
(351)
1.4
1.0
0.1
0.3
2.1
2.4
1.1
1.6
1.2
1.9
0.3
0.1
0.2
0.7
0.0
0.0
0.3
0.3
0.1
0.1
….Aircraft and spacecraft
(353)
Transport equipment
1.5
3.8
1.7
0.1
0.3
0.4
4.4
3.8
6.6
5.2
4.4
2.7
12.4
9.9
14.2
5.2
9.8
7.7
10.5
6.8
(352+359)
0.1
0.4
0.0
0.1
0.3
0.0
5.9
1.1
0.5
1.2
0.5
0.3
0.2
1.6
0.4
0.6
0.6
0.7
0.4
0.6
Manufacturing nec; recycling
(36-37)
0.2
0.6
-
0.4
-
-
0.5
1.0
0.6
0.8
0.4
0.2
0.3
0.3
-
0.4
-
0.6
-
0.6
Electricity, gas and water supply
(40-41)
2.0
1.1
0.3
0.5
0.1
-
0.6
2.3
2.5
0.6
2.3
0.4
2.4
0.8
0.2
0.1
-
-
-
-
Construction
(45)
6.7
3.1
0.5
0.8
0.5
-
4.2
3.6
0.6
0.9
-
0.3
0.2
0.2
-
0.1
-
-
-
-
Total services3
(50-99)
7.6
12.6
6.7
19.7
41.8
48.0
14.4
18.2
16.4
37.6
9.0
11.5
15.1
20.8
….Railroad equip. and transport equip. n.e.c.
18.8
24.3
34.4
8.2
12.9
14.4
(50-55)
-
0.4
-
-
-
-
0.3
0.3
0.0
0.8
-
0.1
-
-
-
-
-
-
-
Wholesale and retail trade; repairs
(50-52)
-
0.4
-
4.0
0.4
-
0.3
0.3
0.0
0.7
-
0.1
-
0.4
-
12.6
-
-
-
-
Hotels and restaurants
(55)
-
0.0
-
-
-
-
0.0
0.0
0.0
0.1
-
0.0
-
-
-
-
-
-
-
-
Wholesale and retail trade; restaurants and hotels
Transport and storage and communication
-
(60-64)
-
3.0
-
2.4
2.8
-
4.1
7.7
2.5
8.8
-
1.4
-
5.9
-
-
-
-
-
Transport and storage
(60-63)
-
0.0
-
0.6
0.4
-
1.3
2.6
0.0
0.2
-
0.0
-
0.1
-
0.1
-
-
-
-
Post and telecommunications
(64)
-
3.0
-
1.9
2.3
-
2.7
5.1
2.4
8.6
-
1.3
3.9
5.8
-
-
-
-
-
-
Finance, insurance, real estate and business services
(65-74)
-
8.9
-
13.2
38.6
-
5.5
3.5
13.4
27.4
-
10.0
-
-
-
-
-
-
-
Financial intermediation
(65-67)
-
0.0
-
2.2
1.1
-
0.0
0.1
0.0
0.6
-
1.1
-
-
-
2.0
-
-
-
-
Real estate, renting and business activities
(70-74)
-
8.9
-
11.0
37.5
-
5.5
3.4
13.4
26.8
-
8.9
10.9
12.3
-
-
-
-
-
-
1.3
2.1
-
3.1
7.1
-
0.0
0.1
6.8
3.9
-
0.3
1.8
2.7
-
-
-
2.2
-
-
-
0.3
4.7
0.1
-
-
4.5
6.8
0.4
0.6
-
0.1
0.2
0.1
-
-
-
-
-
-
……..Other business activities Community social and personal services
(74) (75-99) HTM
37.0
51.4
27.3
39.5
26.6
21.4
13.8
17.7
37.9
23.4
47.2
55.1
40.5
46.8
46.1
39.4
39.7
39.7
42.4
40.4
Medium-high technology manufactures
MHTM
34.9
22.6
48.6
24.9
19.5
15.8
39.1
34.5
27.3
21.7
31.7
26.7
28.7
24.9
21.4
19.4
38.2
35.2
30.6
28.1
Medium-low technology manufactures
MLTM
8.6
5.7
7.4
4.5
12.2
11.4
12.6
8.8
8.9
8.8
3.8
2.8
7.1
4.2
5.0
3.2
6.5
6.0
7.3
4.8
Low-technology manufactures
LTM
2.9
3.1
-
7.0
-
-
6.5
8.4
4.3
6.1
5.2
2.8
3.5
3.2
-
3.0
-
3.4
-
3.6
High- and medium-high technology manufactures
HMHTM
73.3
75.1
76.0
64.7
48.2
39.6
54.0
53.7
66.4
47.0
79.3
81.9
69.4
72.4
67.5
58.8
78.2
75.3
73.2
68.6
High-technology manufactures
2. OECD includes previous countries and Canada, Japan, and the United States. 3. Due to differences in data reporting methodologies, service sector R&D figures are not fully comparable across countries.
Source: OECD, STAN Indicators 2004.
207
Statistical Annex
1. EU includes the 15 EU Members before 1 May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available).
As a percentage of total business R&D expenditures 1991
1995
1997
1999
2000
As a percentage of GDP
2001
Australia
-
31.1
-
41.8
-
-
Canada
-
29.7
34.3
32.6
32.1
31.6
Czech Republic
-
-
22.1
27.4
Finland
-
-
13.3
14.9
France1, 2
-
17.1
16.4
16.4
Germany
-
Greece Hungary2 Ireland 3
Italy
Japan Netherlands Poland
4
Portugal Slovak Republic Spain
4
5
Sweden
16.1
18.1
36.9 -
19.0
7.6
3.8
3.6
4.5
-
21.8
65.3
78.5
68.6
66.2
65.3
23.1
-
-
n
45.3
2002
1991
1995
-
-
-
-
43.4
-
0.28
-
-
0.35
0.35
0.37
0.38
0.21
0.30
0.35
-
a
0.16
d,t
14.3
-
-
-
0.24
0.33
-
-
0.24
0.22
0.22
-
-
-
-
-
-
0.01
-
-
-
-
63.8
-
65.2
-
0.40
-
-
-
-
0.15
1.4
1.3
3.9
3.6
-
-
0.02
-
20.6
21.5
18.7
-
-
-
-
-
-
12.1
12.1
4.6
-
-
-
-
-
18.0
-
30.8
-
-
-
-
0.30
21.5
-
-
0.27
-
0.9
38.7
1999
12.7
-
d,t
1997
a
t
0.24
0.28
0.01
0.20
0.20
0.59
0.55
-
-
-
0.52
-
-
p
0.03
0.08
0.08
-
-
0.23
0.25
0.21
-
-
p
-
a
-
0.03
0.03
0.01
-
b
-
0.03
-
0.08
-
c
0.09
0.09
0.08
-
0.15
-
0.15
m
m
-
0.48
18.4
15.9
34.1
34.0
-
-
0.32
-
-
-
14.8
7.3
10.6
-
-
-
-
0.02
0.02
0.02
-
United Kingdom
-
29.2
32.8
31.2
31.3
40.6
38.0
-
0.37
0.39
0.39
0.38
0.50
a
10.2
13.3
12.3
14.7
14.7
14.9
-
0.20
0.30
j
j
0.24
j
0.93
m
c
-
0.24
0.42
a
17.1
j
c
-
Turkey
United States
-
a
0.46
m
c
p
-
0.03
a,m
-
-
-
-
-
0.18
a
-
0.14
-
-
0.34
c
p
-
a
-
31.0
-
-
0.10
19.0
-
p
-
0.00
20.4
32.8
-
c
2002
l
d
20.4
-
0.00
a
-
0.30
a
-
35.7
0.34
-
0.01
d,t
0.8
0.32
2001
0.31
0.07
-
26.8
-
a
0.59 l
2000
0.29
j
0.30
j
a
-
-
j,p
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1998 instead of 1997.
2. 1998 instead of 1999.
© OECD 2004
Source: OECD, MSTI database, May 2004.
3. 1992 instead of 1991.
4. 2000 instead of 1999.
5. 1990 instead of 1991. StatLink: http://dx.doi.org/10.1787/073550815144
OECD Science, Technology and Industry Outlook 2004
208 Table 15. R&D expenditures of affiliates under foreign control, 1991-2002
Statistical Annex
Table 16. Share of public R&D expenditures financed by industry, 1981-2003 As a percentage of total national R&D expenditures of the sector
Government 1981 Australia1, 2, 3 Austria
4
1.8 1.5
Belgium5
0.0
Canada
1.0
Czech Republic
p
a
1985
1991
1995
2001
2.7
5.7
5.7
5.6
1.3
-
-
3.1
0.0
1.2
2.1
12.4
-
1.0
1.7
1.8
2.6
2.6
b
a
2002 -
-
-
-
-
-
-
-
11.3
6.6
9.6
Denmark
1.6
2.2
3.6
3.5
7.5
5.4
Finland
9.5
-
11.2
11.9
15.2
14.2
a
a
France
1.8
0.7
4.8
Germany
0.8
1.4
1.3
Greece
0.0
-
1.0
-
-
22.0
Iceland
0.5
22.3
10.4
Ireland3
3.6
9.0
Italy
2.3
Japan
1.3
5.4
2.2
0.7
Korea
-
-
-
16.5
Luxembourg3
-
-
-
-
Hungary
Mexico Netherlands New Zealand
r
2.0
r
5.4
6.3 m
2003
n
6.4
-
3.4
c
15.1 7.2
5.0
-
13.4
b
21.8
10.6
8.8
n
-
1.9
a
1.8
3.5
2.2
n
2.9
2.3
c
-
2.3
1.9 c
13.1
b,m
-
0.7 e
e
4.6
5.8
-
-
2.3
-
-
-
-
-
3.3
5.8
-
-
23.2
14.8
16.7
21.6
18.1
-
-
-
5.7
17.7
20.3
-
-
Norway
3.6
7.6
7.3
10.0
10.6
-
-
Poland
-
-
-
22.6
14.3
23.3
-
0.2
4.1
7.1
0.3
3.5
-
-
-
9.3
Portugal6, 7, 1 Slovak Republic Spain
0.7
Sweden
5.4
3.8 e,f
c
5.3
14.0
4.8
e,f
3.0
f
0.3
b,f
-
-
3.4
Turkey3
-
14.6
f
1.6
14.0
c
4.1 f
-
-
-
-
-
3.0
5.4
-
-
-
12.0
a
6.9
12.5
a
10.7
-
0.0
0.3 a
c
7.1
e,f
-
11.0
3.8
32.6
4.8
Switzerland7
United Kingdom
c,q
United States
0.0
f
0.0
f
0.0
f
0.0
f
0.0
f
Total OECD
2.1
b
2.9
b
3.1
a,b
3.7
a,b
3.6
b
-
-
6.0
b
6.7
b
-
-
5.1
b
6.3
b
-
-
9.6
s
-
-
7.5
c,n
-
-
12.2
-
EU-25
-
EU-15
4.1
China3
-
-
-
3
-
-
1.4
-
-
-
Israel
Russian Federation
b
5.2
a,b
4.8
a,b
c
0.2 8.1
c
12.4
n
e
5.7
a
b,m
c
1.2
8.1
n
a
a
2.3
m
2.6
f,n
0.0
f,n
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
© OECD 2004
7. 1986 instead of 1985.
StatLink: http://dx.doi.org/10.1787/702620165887
209
OECD Science, Technology and Industry Outlook 2004
Table 16. Share of public R&D expenditures financed by industry, 1981-2003 (cont’d) As a percentage of total national R&D expenditures of the sector
Higher education
Australia1, 2, 3 Austria
4
1981
1985
1991
1995
2001
1.4
2.1
2.5
4.7
4.9
1.0
1.7
-
-
1.8
8.7
15.4
13.2
12.7
-
4.3
7.0
8.1
9.3
9.3
Belgium5
9.4
Canada
4.1
Czech Republic
a
b
a
2002 -
-
-
-
-
-
-
-
2.0
0.7
0.9
Denmark
0.7
1.0
1.6
1.9
3.0
4.2
Finland
2.1
a
-
3.6
5.7
6.7
6.2
France
1.3
a
Germany
1.8
Greece
0.0
a
1.9
4.2
5.4
7.0
a
a
3.3
3.1
-
8.2
12.2
12.2
-
6.1
5.6
-
-
14.4
2.1
Iceland
1.2
0.6
5.0
Ireland3
7.1
6.9
8.6
Italy
2.7
1.5
4.0
Japan
1.5
Hungary
Korea 3
Luxembourg Mexico Netherlands
New Zealand
b
2.4
b
3.7
a
5.4 b
6.9 4.7
b
-
-
-
-
-
-
-
-
-
-
-
2.6
-
14.3
-
11.3 -
e
22.4
b
-
2.3
-
-
-
5.3
e
-
13.9
e
-
-
-
-
-
1.4
1.1
-
-
0.3
1.0
1.2
4.0
7.1
-
-
-
-
4.6
9.4
5.3
-
2.9
5.0
4.7
5.3
5.8
-
-
Poland
-
-
-
11.4
6.3
5.8
-
0.0
0.9
0.5
-
-
6.1
1.1
10.0
Slovak Republic Spain
0.0
Sweden
2.3
a
Switzerland1, 2, 7, 3
9.5
b
Turkey3
-
5.5 3.3
a,b
-
q
0.9
a
0.8
-
-
1.0
m
0.3
0.0
-
7.6
-
-
-
8.3
8.7 a,h
b
5.5
5.2
4.6
1.8
6.2
5.1
-
-
10.4
16.1
19.4
-
-
-
6.3
6.2
5.8
-
United Kingdom
2.8
a
5.2
a
7.8
United States
3.3
h
4.5
h
5.3
h
5.5
h
5.5
h
4.9
h,n
Total OECD
2.6
b
3.8
b
5.5
a,b
5.8
a,b
6.0
b
5.8
b,n
6.0
b
6.7
b
-
-
5.9
a,b
6.8
b
-
-
32.4
s
-
-
3.7
e
-
-
27.2
-
EU-25
-
EU-15
2.0
China3
-
-
-
3
-
-
7.4
-
-
-
Israel
Russian Federation
a,b
3.7
a,b
5.8
a,b
e
2.3 27.5
e
26.5
b
-
Norway Portugal6, 1, 2
n
a
11.8
b
-
9.3
6.9
3.6
-
n
4.4 10.9 b
2003
4.5
h,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability:
210
1. 1986 instead of 1985.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1992 instead of 1991.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
7. 1996 instead of 1995.
Source: OECD, MSTI database, May 2004.
© OECD 2004
© OECD 2004
Table 17. Basic research expenditures, 1981-2003
As a percentage of GDP 1981 Australia1, 2, 3
0.33
1991 i,p
35.1
-
0.27
-
-
-
-
-
0.17
0.53
i
-
-
-
-
-
0.44
a
-
-
-
-
0.52
i
-
-
-
a
-
18.9
s
-
-
-
Denmark
-
France
-
Hungary1
-
0.48
i
0.47
a
-
0.23
q
0.18
a
i
0.38
i
Iceland
0.16
0.29
Ireland3
0.07
0.08
0.51
i
-
-
Italy
0.11
r
0.25
a,i
0.22
i
Japan
0.28
e,i,j
0.36
i,j
0.41
i,j
Korea
-
-
Mexico
-
-
Netherlands4 New Zealand Norway Poland
0.48
a
0.27
Portugal
i
0.47
0.49
0.14
i
-
18.7 22.1
c,q i
24.8
-
10.3
8.6
-
40.8
i
18.3
a
-
23.3
i
-
-
24.7
a,c
24.2
i
-
37.7
i
-
n
-
-
25.3
c
24.5
c
15.4
i
15.9
i,b
12.2
i,b
-
-
r
20.3
a,i,a
22.0
i
e,i,j
12.2
i,j
14.1
i,j
12.1
i,k
12.5
i,k
-
0.31
0.37
e,i
0.40
e,i
-
-
-
12.4
e
12.7
e,i
13.7
e,i
-
0.09
0.12
-
-
-
-
29.0
-
-
-
25.0
0.19
a,i
i
m
13.7 -
-
13.4
14.7
a
15.0
-
-
-
16.7
0.19
b,m
24.6
0.15
-
-
-
Spain
0.06
0.13
0.17
a
0.15
0.16
-
14.6
15.5
Sweden
0.50
-
-
22.5
i
0.72
-
-
-
United States
0.32
0.46
0.40
-
0.03
0.03
i
0.47 i,k
0.06
i c,i,n
Israel
-
-
-
0.89
Russian Federation1
-
0.07
0.13
0.15
0.49
n
0.07
i
0.89
c,i,n
0.17
0.50 -
b,n
13.7 -
a,k
18.4
30.8
a,m
29.7
24.6
a,i,p,a
22.4
c,q
21.5
c
23.4
21.0
a
15.8
k,p
h
16.9 4.1
44.9
i
i
0.15
-
-
-
-
-
-
16.1
0.19
0.80
-
-
-
0.14
-
a,i
h
i,k
m
k
-
-
-
b,m
-
-
b
-
25.9
k
32.2
-
-
k
-
28.0
i
-
15.9
h
17.2
h
i,k
5.6
-
-
-
-
17.7
-
-
9.5
15.3
12.9
i c,i,n
-
15.5
i
5.0
a,k
a,i
30.0
-
-
-
-
a,i,p
-
9.5
-
30.8
-
a,m
Switzerland2, 3
i
-
-
0.20
0.19
a
c
i,k
-
a, k
12.1
0.20
China
i
-
15.2
12.5
-
-
k,p
b
22.1
i
-
0.53
0.50
c,q
-
26.0
-
0.24
a,k
16.8 -
a
-
Slovak Republic
c,q
i
25.0
i
-
20.3
-
25.9
2003
i,k
-
0.15
i
2002
0.39
0.25
0.05
28.3
2001
i,k
-
-
i
b,i
i,p
1995
0.37
0.22 -
i
0.25 i
-
i
0.49
-
0.24
0.19 5, 1
1991
-
Czech Republic
0.46
1981
-
-
Germany
2003
a, k
0.43
i
As a percentage of GERD 2002
i
-
i
2001 0.40
0.43
Austria4
s
1995
18.4 5.7 18.9 13.7
h,n
i c,i,n
19.1
b,h,n
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 3. 2000 instead of 2001.
5. 1983 instead of 1981.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source : OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/345101246407
211
Statistical Annex
1. 1992 instead of 1991. 2. 1996 instead of 1995.
OECD Science, Technology and Industry Outlook 2004
212 Table 18. Basic research by performer, 1991-2003 As a percentage of GDP
Business enterprise
Australia1, 2, 3
1991
1995
2001
Government
2002
2003
1991
1995
2001
Higher education
2002
2003
1991
1995
0.04
0.04
0.05
-
-
-
0.12
0.11
0.10
-
-
-
0.25
0.25
Austria
-
-
0.04
a
-
-
-
-
0.02
a,k
-
-
-
-
Czech Republic
-
0.01
0.22
i
0.20
i
0.19
-
-
0.04
Denmark
-
-
0.07
a
0.03
-
0.20
0.25
0.09
i
-
-
0.32
i
4
France Germany Hungary
1
0.06
i
0.09
a
0.07
0.02
c,q
0.01
Iceland
-
0.06
i
0.08 i
a
-
0.05
a,i
i
-
-
0.13
-
-
0.05
0.08
-
-
0.09
i
0.08
-
-
0.12
0.01
0.02
-
0.13
c,q
0.10
0.00
-
0.10
i
0.04
i
-
Ireland
0.02
Italy
0.02
a,i
0.02
i
0.03
i
0.03
i,n
0.03
Japan
0.14
i,j
0.13
i,j
0.13
i,k
0.14
i,k
-
0.15
e
0.16
i
0.20
i
-
0.00
0.01
-
-
-
Korea
2
Mexico Netherlands
0.13
New Zealand
i
0.11
a
0.00
-
0.19
i
0.00 i,n
i
-
0.07
e
0.08
-
0.04
0.06
-
-
-
0.13
-
-
-
-
-
-
0.20
-
-
0.03
0.04
0.04
-
-
0.10
a,m
0.09
-
0.02
a
0.03
Poland
-
0.01
a,m
0.01
0.00
0.00
a,i,p
0.01
-
-
0.01
0.01
a,i,p
0.01
-
0.03
c
0.03
0.03
-
-
0.13
c
0.08
0.02
0.02
a
0.02
0.02
-
0.03
0.03
a
0.03
0.08
f
Portugal
1
Spain Sweden
0.03 1, 2, 3
Switzerland
p
0.16
-
-
0.19
0.20
0.01
i
0.05
p
Turkey
0.01
United Kingdom
0.04
United States
0.13
China
0.00
0.00
Israel
-
-
0.19
Russian Federation1 0.01
0.02
0.02
p
0.08 i,k
0.00
a
e,f
-
-
0.01
-
-
0.00
-
-
0.01
a
0.08
-
0.03
s
0.04
0.04
f
0.04
0.02
i
0.02
0.08
n
i
0.00
i
c,i,n
0.17
c,i,n
0.08 i,k
b,m
-
0.05
0.01
0.02
0.08
b,n
0.17 -
c,i,n
0.00 0.00
0.09
e,i
i
i
0.00
-
0.01
0.01
-
0.37
i
-
0.24
i,p
0.27
i
-
0.03
0.05
0.05
0.08
b
0.10
b
-
-
i
0.13
i
-
-
-
j
0.14
0.01
-
-
0.23
b,i
-
-
0.00
-
-
-
-
a
0.16
0.16
i,k
-
0.02
ei
0.12
0.11
ei
0.08
0.09
i,k
-
0.18
0.09
e,i
-
-
0.10
-
-
-
0.05
0.06
-
-
-
-
0.01
-
-
-
-
-
-
-
0.24
-
-
0.17
0.19
0.18
b,m
-
-
0.09
m
-
0.11
0.10
aip
c
-
-
0.04
-
0.08
0.11
-
0.46
-
-
-
-
0.55
0.47
c
0.09
-
0.03 0.00
-
0.00
0.01
i,n
0.09
f
0.00
0.01
0.09
m
0.00
-
-
-
0.14
-
-
0.34
-
0.06
-
0.11
a
-
0.00
0.09
i
-
b
a
0.10 0.28
-
i
0.05
f,i
-
0.10
0.16
j
-
0.11
-
0.04
i
-
a
0.15
-
0.00
-
b
i,n
0.03
-
-
i,p
i
0.02
-
-
0.12
0.06
0.02
-
0.01
0.07
i
-
-
-
c,q
0.08
-
a
0.01
0.09
a,i
-
0.21
2003
-
-
-
0.23
2002
0.01
0.13
-
2001
-
0.11
-
1995
-
a
b,i
i
1991
-
0.26
0.19
i
2003
-
-
i
i
Private non-profit
2002
-
-
0.01
m
0.33
-
-
0.09
i
i
a
Norway
Slovak Republic
0.09
-
i
2001
i
a
0.10
ei
i
m
0.02 b
0.00
b
-
-
a
0.01
-
0.01
e
0.00
-
0.00
0.00
-
-
-
0.01
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
0.00
0.00
0.00
-
b,m
0.14
-
-
0.02
0.03
0.03
0.04
0.03
-
-
-
0.00
0.10
0.11
-
0.00
0.00
0.00
-
-
0.02
0.10
j
b
-
-
0.00
-
-
0.00
k
-
-
0.06
0.04
e
0.00
e
k
0.00
k
0.00 -
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
0.03
a
0.03
-
-
-
-
-
-
-
-
-
-
-
f
0.04
f
0.04
f,n
0.25
0.24
0.28
0.30
n
i
0.04
b,f,n
0.04
h
0.04
h
0.06
0.04
i
0.04
i
-
0.01
0.02
i
0.03
i
-
-
-
-
-
0.05
c,i,n
0.05
c,i,n
-
-
-
0.61
e,i,n
0.62
e,i,n
-
-
-
0.04
0.05
0.09
0.11
-
0.02
0.02
0.02
-
0.00
0.00
0.00
0.01
i
b,n
-
0.13
i
0.31
0.02
h
0.07
c,n
0.05
h,n
0.07
c,n
-
-
0.00
b,h,n
-
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
© OECD 2004
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/377412476274
© OECD 2004
Table 19. Government budget appropriations and outlays for R&D by socio-economic objectives, 1991-2003 As a percentage of total R&D budget
Defense
Civil Economic development
1991
2001
2003
1991
2001
Health
2003
1991
2001
Space 2003
1991
10.3
f
5.8
f
5.7
f,n
25.8
f
36.8
f
34.3
f,n
14.6
f
16.4
f
19.9
f,n
-
Austria
0.0
f
0.0
f
0.0
f,n
14.6
f
15.8
f
12.7
f,n
8.6
f
8.8
f
8.5
f,n
0.4
Belgium
0.2
0.4
n
25.6
36.9
n
9.6
n
Canada Czech Republic1
5.1 -
-
Denmark
0.6
0.5
Finland France1
36.1
Australia
0.2 f
-
a
1.1 2.9
n
40.4
a
24.3
n
21.0
7.4
6.7
n
22.7
1.5
0.8
0.9
n
29.7
Iceland
0.0
0.0
0.0
n
Ireland
0.0
0.0
Germany Greece1
1.4 11.0
Italy
7.9
Japan
5.7
Korea
-
f
a
4.3
1.6 22.8
a
e,f,k
3.3
4.0
n
4.3
f,k
15.8 f
33.8 -
32.9 f
32.0
-
-
26.3
21.1
-
a
16.5
19.8
13.8 -
-
n
16.3
12.3
n
6.3
19.1
n,s
11.6
20.8
18.0
n
17.5
51.4
36.7
33.0
n
-
48.5
41.4
-
-
21.8 31.6
14.2
-
e,f
f
s
16.1
n
-
32.8
f
31.9
a
f
-
a
16.7
16.7
7.2 -
3.1
n
8.6
13.7
n,s
5.4
19.8
19.0
n
0.3
7.2
10.6
10.0
n
12.7
12.8
-
5.4
46.7
44.7
-
e,f
f
13.4
s
15.5
n
-
7.5
f
7.3
a
15.0
f
3.1
f
3.7
f,n
34.4
f
37.9
f
36.4
f,n
f,n
12.4
f
13.7
f
13.1
f,n
64.0
f
61.5
f
65.5
f,n
8.9
n
22.7
22.9
n
23.9
18.2
n
6.2
f
-
a
2.2
0.9
12.5 -
-
10.5
n
15.3
4.9
n,s
15.2
0.2
0.1
n
-
-
3.8
0.0
15.7
16.7
-
e,f
f
7.2 18.0
n
s
f
-
8.9
4.9
23.3
23.3
1.9
6.8
2003
f,n
1.9
7.0 f,n
2001
0.1
9.6 a
1991
0.0
-
n
General university funds
2003
f
2.4
10.2
2001
f
-
15.2
1991
0.1 11.2
f
Non-oriented programs 2003
0.0
2.7
10.1 a
f
12.4
15.4
18.2 f,n
23.5 19.8
39.1
18.8
f
-
12.7 a
9.7
14.1
41.1
4.5
a
f
10.1
2001
a
a
f
-
a
20.6
25.7
27.6 -
25.7
-
37.4
13.7
n
28.3
19.3
19.7
n
12.4
16.6
n,s
33.2
s
b,f
33.0
14.2 17.2
18.6
a
a
b,f
27.6
a
-
42.1
25.9
27.2
n
23.2
23.0
n
39.3
n,s
38.4
s
3.4
12.5
10.9
n
46.1
45.6
50.7
n
-
16.6
17.5
-
n
24.9
35.2
38.4
n
-
5.1
27.6
-
29.9
18.3
-
7.3
n
-
10.6
6.7
f
6.7
8.0
3.2
2.8
-
e,f
f
13.3
n
-
13.8
f
15.3
18.5
m
21.6
-
l
31.3 f,n
42.5
e,f
f
43.7
n
-
34.8
f
34.4
-
l
-
m
-
f,n
Mexico
0.0
0.0
-
32.6
33.5
-
14.2
12.5
-
0.0
0.0
-
20.4
-
32.8
Netherlands
3.0
1.9
-
28.1
25.3
-
8.7
8.7
-
2.6
2.6
-
10.6
10.7
-
43.0
46.3
-
New Zealand
1.5
-
-
46.7
-
-
25.3
-
-
-
-
-
1.2
-
-
24.1
-
-
Norway
6.2
7.5
6.9
n
31.5
26.1
21.2
n
18.3
18.8
18.8
n
2.7
2.2
1.9
n
10.5
8.9
12.2
n
30.8
36.4
39.0
n
Portugal Slovak Republic2
0.7
2.1
2.0
n
38.5
31.4
35.4
n
18.0
17.8
16.7
n
0.2
0.5
0.5
n
8.4
10.5
9.9
n
30.3
35.6
33.5
n
-
9.3
m
7.2
m
-
29.2
21.3
-
10.9
10.2
-
-
-
32.4
m
-
-
16.6
-
Spain
16.8
37.3
b
-
27.5
22.7
-
15.1
9.7
-
7.0
2.4
2.1
b
-
20.0
25.8
Sweden Switzerland3, 4
27.3
22.2
17.8
8.9
1.7
-
3.7
-
-
United Kingdom1
43.9
United States
59.7
f,g,h
Total OECD
36.4
a
4.6
EU-25
-
EU-15
20.6
Russian Federation
-
14.6 f
0.7
f
30.5
a
50.5
f,g
34.1
-
53.7
b,f,g
28.8
n
-
17.9
14.9
a,n
-
-
15.4
a,n
-
23.8
-
-
43.5
12.2 f,k
16.2 8.9
b
4.6
f,k
9.4 f,g,h
a
a
6.5
f,g,l
13.6
8.3
-
3.5
10.8 f,k
2.4
f,k
9.8
-
12.5
5.6
b,f,g
17.5
f,g,h
26.2
f,g,l
a
18.8
n
13.5
a,n
13.8
a,n
15.9
n
-
13.8
16.8
a,n
-
-
17.2
a,n
-
11.3
-
-
24.4
b
22.4
a
7.0
l
-
l
b
-
10.8
2.7
0.6
14.6
-
-
-
2.1
1.9
-
5.1
8.4
b,f,g
4.0
f,g,h
a
20.1
-
2.7
26.3
b,f,g
9.9
f,g,h
9.8
f,g
-
7.5
a
7.2
n
-
8.2
-
-
5.2
a,n
-
-
-
5.6
5.3
a,n
-
12.4
-
-
-
-
a
10.1
-
16.7 l
-
l
13.6
a
6.9
16.7
30.4
-
59.3
13.3 f,g
a,m
6.0
b,f,g
b
43.1 f,m
61.1
38.0 f,m
-
21.8
20.2
-
-
-
n
-
15.5
14.8
a,n
-
-
15.0
a,n
-
24.9
-
-
a
a
17.4
n
-
31.6
a,n
-
32.5
a,n
-
0.0
l
-
18.9
10.7
14.0
53.9
-
-
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 2002 instead of 2003.
2. 2002 instead of 2001.
Source : OECD, MSTI database, May 2004.
3. 1992 instead of 1991.
4. 2000 instead of 2001.
StatLink: http://dx.doi.org/10.1787/147403505165
Statistical Annex
213
OECD Science, Technology and Industry Outlook 2004
Table 20. Tax treatment of R&D, 1990-2004 Rate of tax subsidies for 1 USD of R&D1, large firms and SMEs SMEs 1999
2001
Large firms 2004
1990
1995
1999
2001
2004
Australia2
0.11
0.20
0.12
0.28
0.21
0.11
0.20
0.12
Austria
0.12
0.12
0.11
0.02
0.07
0.12
0.12
0.11
Belgium
-0.01
-0.01
-0.01
-0.01
-0.01
-0.01
-0.01
-0.01
Canada
0.32
0.32
0.32
0.17
0.17
0.17
0.17
0.17
Denmark
3
Finland
-
0.11
0.18
0.00
0.13
-0.02
-0.01
-0.01
-0.01
-0.02
-0.01
-0.01
France
4
0.11
0.18
-0.01
-0.01
0.09
0.06
0.13
0.09
0.08
0.09
0.06
0.13
Germany
-0.04
-0.02
-0.02
-0.05
-0.05
-0.04
-0.02
-0.02
Greece
-0.01
-0.01
-0.01
-
-
-0.01
-0.01
-0.01
5
Hungary
-
-
0.16
-
-
-
-
0.16
Iceland
-0.03
-0.01
-0.01
-0.03
-
-0.03
-0.01
-0.01
Ireland
0.06
-
0.05
0.00
-
0.06
-
0.05
Italy
0.45
0.44
0.45
-0.04
-0.05
-0.03
-0.03
-0.03
Japan6
0.06
0.12
0.19
-0.02
-0.01
0.02
0.01
0.14
Mexico
0.03
0.03
0.39
-0.02
-0.02
0.03
0.03
0.39
7
-
0.35
0.11
-0.02
0.10
0.10
0.10
0.02
New Zealand
-0.13
-0.02
-0.02
-
-
-0.13
-0.02
-0.02
Norway
-0.02
0.23
0.23
-0.04
-0.02
-0.02
-0.02
0.21
Portugal
0.15
0.34
0.28
-0.02
-0.02
0.15
0.34
0.28
Netherlands
Spain
0.31
0.44
0.44
0.25
0.28
0.31
0.44
0.44
Sweden
-0.01
-0.01
-0.01
-0.02
-0.02
-0.01
-0.01
-0.01
Switzerland
-0.01
-0.01
-0.01
-0.01
-0.02
-0.01
-0.01
-0.01
United Kingdom
0.11
0.11
0.11
0.00
0.00
0.00
0.10
0.10
United States
0.07
0.07
0.07
0.09
-0.02
0.07
0.07
0.07
1. Tax subsidies are calculated as 1 minus the B-index. For example, in Australia in 2001, 1 dollar of R&D expenditure by large firms results in 20 cents of tax relief. 2. Calculation of Australia’s B-index was adjusted to show the correct weights of the volume-based, 125% tax concession and the 175% incremental tax concession for R&D. 3. The 2004 calculation for Denmark applies to the 150% allowance on collaborative research at universities or public research institutions. Without this incentive, the B-index is 1.015. 4. 1998 instead of 1999. 5. The B-index for Hungary is based on the 100% R&D tax allowance for research and technology development (which also applies to subcontracted R&D if the partner is a public or non-profit research organization). A 300% allowance is available if the company’s R&D laboratory is located at a university or public research site; the B-index in this situation equals 0.666. 6. The 2004 B-index for large firms in Japan applies to firms with a ratio of R&D to sales of less than 10%. The B-index for large firms with a R&D-to-sales ratio above 10% is 0.831. The B-index for research conducted in collaboration with universities is 0.782. 7. Calculations for the Netherlands were revised to reflect the taxability of the savings from the tax credit.
214
Source: OECD, 2004.
StatLink: http://dx.doi.org/10.1787/486405683434
© OECD 2004
Statistical Annex
Table 21. Total researchers per thousand employment, 1981-2002
1981 Australia1, 2, 3 Austria
3.6
4
1985 b
1.8
Belgium
3.5
Canada3
3.5
Czech Republic
1
b,r
4.3 2.0
k
4.1
b,r
4.4
-
1991
1995
2001
6.8
7.2
7.3
-
-
-
-
4.7
k
-
6.1
7.8
6.4
7.1
b,n
-
4.8
b,r
5.1
-
3.8
b,c,j,q,r
-
2.2
b
2.9
b
7.0
r
-
15.8
r
16.4
2.9
Denmark
2.8
b,r
4.6
r
6.1
r
Finland5
3.9
r
-
6.0
r
8.2
r
France
3.9
a
4.7
5.7
6.7
7.2
-
Germany
4.6
5.2
6.3
a
6.2
6.8
6.8
3.4
b,r
2002
Greece
-
-
1.8
b
Hungary
-
-
3.2
b,c
Iceland
-
Ireland
3
1.8
Italy
2.4
Japan
5.3
b
2.5
b
2.9 j
6.2
4.4
7.5
-
2.9
c
3.8
b
3.3 j
2.6
a
4.5 3.4
j
8.3
j e
5.0
3.9
-
10.2
9.9
b
6.3
e
6.4
e
-
-
-
-
4.9
Luxembourg 3
-
-
-
-
6.2
Mexico
-
-
-
0.6
-
3.4
4.3
-
4.8
5.5
-
-
4.0
4.7
6.9
a
-
8.7
r
-
Norway
3.8
Poland Portugal
r
4.8
6, 7, 1
Slovak Republic
0.8
r
b
1.1
-
6.6
r
b
-
2.1
7.5 3.4
a,b,r
-
3.5 4.7
4.6
3.5
5.0
5.1
8.2
10.6
1.8
4.2
a,k
5.0
k,r
-
4.2
a,b,r
4.4
5.5
-
-
0.6
0.8
United Kingdom
4.9
5.0
4.6
United States
6.3
7.0
a
7.7
3
4.5
5.2
a,b
5.6
Switzerland Turkey3
Total OECD EU-25
-
EU-15
3.5
China
-
Israel Russian Federation
b
b
a
a,b
-
b
b,r
b
-
-
6.3
-
1.1
b
-
5.4
-
-
7.6
-
-
5.8
a,b
6.5
b,n
-
4.9
b
5.6
b
-
b
-
4.7
a,b
5.2
b
5.9
-
0.7
k
0.8
k
1.0
-
-
-
-
-
-
-
-
-
9.2
7.9
7.5
4.0
b
3.9
c
Sweden 7, 1, 2, 3
3.8
4.6
b
k,r
-
2.6
1.6
2.9
-
r
Spain
5.9
a,r
c
2.8
-
New Zealand
b
a,b
Korea
Netherlands
r
c
b
b
1.1
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
3. 2000 instead of 2001.
5. 1983 instead of 1981.
2. 1996 instead of 1995.
4. 1998 instead of 2001.
6. 1982 instead of 1981.
Source: OECD, MSTI database, May 2004.
© OECD 2004
7. 1986 instead of 1985.
StatLink: http://dx.doi.org/10.1787/730776281328
215
Per thousand labour force Business sector
Australia1, 2, 3
1991
1995
Government
2001
2002
1991
1995
Higher education
2001 -
Private non-profit
2002
1991
1995
2001
2002
1991
1995
2001
2002 -
1.62
1.67
1.66
-
1.12
0.99
0.92
-
3.25
3.88
4.07
-
0.08
0.14
0.15
Austria4
-
-
3.01
-
-
-
0.25
-
-
-
1.53
-
-
-
0.02
Belgium
2.08
2.82
4.06
0.23
0.44
-
2.00
-
0.04
Canada
2.09
3.30
3.99
-
0.58
-
0.95
1.11
1.20
-
Czech Republic Denmark
b,r
b
4.08
b
0.19
1.77
2.39
3.37
-
0.88
Finland
-
-
-
-
-
France
2.37
2.61
3.28
-
1.03
3.29
3.98
-
0.94
0.37
-
-
0.49
0.71
0.99
1.06
0.85
2.41
5.24
-
2.06
Germany
3.56
Greece
0.26
Hungary1
0.82
Iceland
1.19
a
a
a
b
a
a
c,q
n
2.32
r
2.72
b b,n
b,r
0.06
r
0.06
b
-
0.44
-
1.99
2.08
2.12
-
0.04
0.03
0.02
-
0.94
0.86
-
0.52
0.82
0.83
-
0.00
0.03
0.01
1.28
1.26
0.77
1.42
1.97
2.10
2.75
0.06
0.07
0.06
0.05
-
-
-
-
-
-
-
-
-
-
-
1.07
0.85
-
n
1.68
2.11
2.31
-
0.08
0.15
0.13
-
0.99
b
1.57
0.52 c,q
b,r
0.83
a
0.95
b
0.97
0.47
a
0.45
b
-
0.86
c
1.14
c
1.12
2.17 b
a
0.83 c
1.64 1.43
1.71
1.76
1.96
-
b
0.03
a
-
-
-
-
0.02
0.01
-
0.99
1.45
1.46
-
-
-
-
2.61
-
1.53
a
2.55
3.16
-
0.11
a
0.09
0.42
-
0.28
0.31
1.83
b
1.32
1.23
-
0.15
b
0.12
-
-
0.54
-
1.34
1.51
1.14
-
-
-
-
-
0.51
1.65
1.82
2.97
2.55
0.21
0.24
0.16
0.16
Ireland
1.57
2.32
3.35
-
0.26
b
0.19
Italy
1.20
1.19
1.11
-
0.51
a
0.61
Japan
5.24
5.76
6.38
6.45
0.46
b,j
0.46
b,j
0.50
e
0.61
e
1.05
a
a,r
Korea
-
3.23
4.47
4.55
-
0.54
e
0.50
-
0.93
-
0.05
-
-
5.24
-
-
-
0.76
-
-
-
-
0.08
-
-
-
-
Mexico
-
0.06
-
-
-
0.17
-
-
-
0.32
-
-
-
0.01
-
-
Netherlands
-
1.79
2.75
-
-
1.06
0.83
0.82
1.78
1.68
1.93
-
-
0.06
0.04
0.03 -
a
e
1.03
e
a
1.09
e
b
Luxembourg3
a
e
b
e
0.05
e
0.06 -
0.83
0.88
1.30
-
0.93
0.84
1.02
-
1.14
1.69
2.89
-
-
-
-
Norway
-
-
4.78
-
-
-
1.31
-
1.95
2.28
2.40
-
-
-
-
-
Poland
-
0.65
0.55
0.27
-
0.65
a
0.61
0.85
-
1.63
2.10
2.16
-
0.00
0.00
0.00
1.68
-
0.24
c
0.92
1.84
1.76
-
a,k
0.51
New Zealand
Portugal1 Slovak Republic
0.21
a
-
0.23
a
0.51
-
0.42
0.85
c
0.85
0.83
-
1.06
1.34
6.25
-
0.38
-
0.15
0.14
-
0.09
0.08
0.11
a
1.48
k
0.62
0.51
0.73
Sweden
2.93
Switzerland1, 2, 3
2.37
3.04
3.86
Turkey3
0.06
0.10
0.16
a
-
United Kingdom
2.78
2.88
3.16
a
3.50
0.52
United States3
6.04
5.89
7.20
n
-
0.45
h
a,b
k
4.34
a
-
1.13 k
a
-
1.23
a
1.60
a
0.41
a
0.45
-
-
0.00
0.00
0.03
0.05
0.02
-
-
-
0.69
1.31
1.69
2.63
2.49
0.01
-
2.52
2.70
3.55
-
0.01
0.11
1.76
2.09
2.18
-
-
-
-
-
-
0.41
0.54
0.75
-
-
-
-
-
0.13
0.14
-
-
a
a
e
0.34
0.31
1.01
1.65
-
-
0.10
0.11
-
-
1.08
1.35
-
-
0.07
0.08
0.43
a,b
-
-
1.24
1.14
-
-
0.07
0.06
-
-
-
-
-
-
-
-
-
-
-
-
3.44
-
-
0.54
-
-
-
-
EU-15
2.22
2.32
-
-
0.71
a,b
0.74
China
0.19
0.53
0.59
0.31
k
0.27
Israel
-
4.02
3.81
-
5.05
k
0.91
h
-
k,s
0.75
0.48
3.51
0.28
k
0.40
EU-25
k,s
0.68
0.51
Spain
Total OECD
0.66
0.58 b,c,q
-
k
2.16
-
-
1.45
0.25
0.25
0.20
2.05
2.01
-
1.75 s
0.19 1.15
s
k
-
-
0.05
0.08
-
-
0.23
0.24
-
-
-
-
1.06
0.96
-
0.00
0.03
0.02
© OECD 2004
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1992 instead of 1991.
2. 1996 instead of 1995.
Source: OECD, MSTI database, May 2004.
3. 2000 instead of 2001.
4. 1998 instead of 2001.
StatLink: http://dx.doi.org/10.1787/178788378577
OECD Science, Technology and Industry Outlook 2004
216 Table 22. Researchers by sector of performance, 1991-2002
Statistical Annex
Table 23. Human resources in science and technology, 1995-2002 HRST Average annual growth rate, 1995-2002
As a percentage of total employment, 2002
Australia
3.07
1
35.6
2
Austria
2.08
3
24.7
2
Belgium
2.23
3
30.1
2
Canada
3.00
29.0
Czech Republic
1.69
29.7
Denmark
3.46
Finland
2.32
France
2.11
Germany
2.04
Greece
2.65
35.3 4
32.5 29.2
3
33.5
2
19.7
-1.03
5
23.9
2
Iceland
5.60
5
29.0
2
Ireland
7.05
22.4
Italy
4.26
28.4
-
15.7
Hungary
Japan
6
Korea
3.40
Luxembourg
5.43
Netherlands
3.90
16.2 3
31.6
2
34.3
3.06
1
26.0
2
Norway
7.64
5
34.7
2
Poland
-1.14
5
23.5
2
Portugal
-0.64
New Zealand
Slovak Republic
1.03
14.8 7
28.8 37.7
Spain
8.36
Sweden
3.37
4
23.1
Switzerland
1.04
7
United Kingdom
2.49
25.3
United States
2.00
32.7
36.1
1. 1996-2001 instead of 1995-2002. 2. 2001 instead of 2002. 3. 1995-2001 instead of 1995-2002. 4. 1997-2001 instead of 1995-2002. 5. 1999-2001 instead of 1995-2002. 6. Data for Japan are national estimates. 7. 1999-2002 instead of 1995-2002.
Source: OECD, Science, Technology and Industry Scoreboard 2003 . StatLink: http://dx.doi.org/10.1787/053853630826
© OECD 2004
217
Tertiary A level and advanced research programmes Thousand of graduates Science
Australia
As a percentage of total graduates
Engineering
Science
Share of women
Engineering
1998
2000
2001
1998
2000
2001
1998
2000
2001
1998
2000
Science
Engineering
2001
1998
2000
2001
1998
2000
2001
17.2
17.5
19.7
11.8
11.8
12.4
11.5
11.8
11.9
7.9
7.9
7.5
8.4
8.6
8.5
2.9
3.0
2.9
Austria
2.2
1.7
1.7
2.4
3.0
3.5
13.7
9.9
9.1
14.7
17.3
18.7
9.3
7.0
7.4
5.0
6.7
6.7
Belgium 1
1.5
3.2
3.7
2.6
4.0
4.3
8.3
9.9
10.9
14.6
12.5
12.5
6.9
7.5
8.2
6.3
5.3
5.1
Canada
17.5
18.9
-
12.0
12.6
-
11.7
12.2
-
8.0
8.2
-
8.9
9.6
-
3.1
3.2
-
1.3
3.8
4.2
5.0
4.6
4.5
5.9
12.7
11.9
22.3
15.5
12.8
3.2
6.3
5.3
9.9
8.3
7.5
Czech Republic Denmark2
1.6
1.9
2.2
1.2
1.4
3.0
12.9
12.6
6.7
9.8
8.9
9.0
10.9
10.7
4.5
5.8
4.7
3.4
Finland
1.8
2.2
2.2
5.5
6.7
6.4
8.0
7.9
7.2
24.2
24.0
20.8
6.5
6.2
5.3
7.9
7.7
6.5
France
56.8
65.2
67.0
46.1
40.6
41.3
15.9
18.0
18.2
12.9
11.2
11.2
13.8
13.8
14.2
5.0
4.8
4.7
Germany
31.5
27.6
26.2
43.0
38.8
36.4
14.7
13.5
13.2
20.1
19.0
18.4
10.6
9.5
9.5
7.6
8.3
8.2
Hungary
2.0
1.4
1.4
5.9
5.8
4.2
4.5
2.3
2.5
13.5
9.8
7.4
3.6
1.3
1.3
5.5
3.6
3.3
Iceland
0.1
0.2
0.2
0.1
0.1
0.1
13.1
10.7
11.0
5.9
7.1
6.5
8.1
7.8
8.2
2.3
2.6
2.1
Ireland
3.9
5.4
5.5
2.3
2.5
2.2
16.9
19.7
19.4
10.0
9.3
7.9
14.9
16.8
15.9
3.9
3.9
3.5
Italy
18.3
15.8
15.6
25.1
29.7
31.0
11.1
8.5
8.0
15.2
16.0
15.9
11.6
8.4
7.8
7.6
7.9
7.8
Japan
26.3
26.7
28.8
127.7
129.7
133.5
4.4
4.4
4.6
21.6
21.3
21.2
3.0
3.0
3.1
4.9
5.3
5.8
Korea
24.4
27.2
33.3
62.7
67.4
74.3
11.0
11.1
12.2
28.2
27.4
27.2
11.6
11.7
12.3
14.4
14.3
13.6
-
0.1
-
-
-
-
-
31.5
-
-
-
-
-
-
-
-
-
-
Mexico
6.5
25.8
29.0
51.8
40.4
41.1
2.8
9.0
9.7
22.0
14.0
13.8
2.8
8.0
8.4
14.5
6.0
6.2
Netherlands
4.8
3.6
4.1
10.1
7.8
8.3
5.7
4.8
5.2
12.1
10.4
10.5
3.0
2.5
2.7
2.8
2.4
2.4
New Zealand
3.6
4.1
4.5
1.8
1.8
1.8
13.3
13.0
14.1
6.9
5.6
5.5
10.2
9.7
10.4
3.7
3.0
2.9
Norway
1.3
1.6
1.9
3.1
1.8
2.4
3.8
6.3
6.8
9.0
6.8
8.3
1.9
2.9
3.2
3.7
2.9
3.0
Poland
3.4
11.7
15.0
23.5
27.6
29.8
1.5
3.4
3.5
10.4
8.0
7.0
0.3
3.4
3.1
0.8
3.0
2.6
Luxembourg
Portugal Slovak Republic 2 Spain Sweden Switzerland Turkey United Kingdom United States Total OECD
1, 2, 3
-
3.0
-
-
6.6
-
-
5.7
-
-
12.4
-
-
4.1
-
-
6.6
-
1.6
1.4
2.3
2.8
3.2
4.3
8.5
6.8
9.4
14.8
15.4
17.8
4.8
4.0
6.2
7.6
8.8
10.8
20.1
21.7
22.8
24.0
27.6
30.8
9.4
10.2
10.4
11.2
12.9
14.2
7.3
8.1
8.1
4.9
6.0
6.9
3.0
3.2
3.6
5.4
7.8
8.3
9.0
8.5
9.4
16.2
20.5
21.5
5.4
6.7
7.5
6.2
8.6
10.1
2.6
3.9
4.0
3.8
4.2
3.7
11.4
14.5
15.0
17.0
15.7
14.1
8.2
9.3
9.0
5.1
4.6
4.3
13.5
14.3
16.3
14.3
17.5
18.1
10.5
10.9
10.4
11.1
13.3
11.6
12.2
12.5
12.1
6.6
7.8
6.7
54.2
64.7
77.0
46.5
39.0
44.7
14.5
16.5
18.1
12.4
9.9
10.5
11.4
13.3
14.6
4.3
3.6
3.7
158.3
169.7
173.4
120.6
117.7
118.3
9.2
9.3
9.4
7.0
6.5
6.4
7.2
7.3
7.3
2.4
2.4
2.4
510.9
544.3
565.5
657.4
654.9
668.6
9.6
9.8
10.0
12.4
11.8
11.8
7.7
8.0
8.0
4.2
4.4
4.5
EU-251, 2, 3
211.6
234.4
254.5
258.2
250.0
263.0
11.1
11.6
11.6
13.6
12.3
12.0
9.4
9.0
8.9
5.4
5.0
4.9
EU-151, 2, 3
198.6
216.2
231.7
220.1
208.8
220.2
12.9
13.7
14.1
14.3
13.3
13.4
10.4
10.8
11.1
5.6
5.5
5.6
-
4.0
4.6
-
3.3
3.8
-
10.3
11.5
-
8.5
9.6
-
7.3
8.4
-
3.3
3.7
Israel
© OECD 2004
1. Flemish Community only instead of Belgium in 1998. 2. 1999 instead of 1998. 3. Do not include Greece, Luxembourg, Portugal and Spain.
Source: OECD, Education database, July 2004.
StatLink: http://dx.doi.org/10.1787/831562532438
OECD Science, Technology and Industry Outlook 2004
218 Table 24. University graduates in science and engineering, 1988-2001
Statistical Annex
Table 25. Triadic1 patent families by priority year, 1991-2000
Average annual growth rate 1991-2000
Number of triadic patent families
Australia Austria
1991
1995
1997
1999
156
226
299
304
b,n
262
b,n
174
217
248
2000
321
b,n
274
b,n
8.0 5.0
As a percentage of total world triadic patent families 1991
1995
1997
1999
0.5
0.6
0.7
0.7
b,n
0.7
b,n
0.6
b,n
0.6
b,n
0.6
0.6
0.6
2000
Belgium
239
369
395
366
b,n
359
b,n
4.5
0.8
1.0
0.9
0.8
b,n
0.8
b,n
Canada
275
382
525
539
b,n
519
b,n
7.1
0.9
1.1
1.2
1.2
b,n
1.2
b,n
9
3
10
9
b,n
9
b,n
-0.6
0.0
0.0
0.0
0.0
b,n
0.0
b,n
250
b,n
254
b,n
0.6
b,n
0.6
b,n
489
b,n
12.4
0.5
0.9
1.0
1.0
b,n
1.1
b,n
2 127
b,n
2.0
6.0
5.4
5.2
4.8
b,n
4.9
b,n
13.4
b,n
13.2
b,n
Czech Republic Denmark
105
188
221
Finland
161
312
416
419
b,n
France
1 783
1 905
2 200
2 081
b,n
5 867
b,n
5 777
b,n
Germany
3 676
4 815
5 634
9.8
5.0
0.4
12.3
0.5
13.6
0.5
13.4
Greece
5
1
9
4
b,n
6
b,n
2.0
0.0
0.0
0.0
0.0
b,n
0.0
b,n
Hungary
22
25
31
30
b,n
33
b,n
4.6
0.1
0.1
0.1
0.1
b,n
0.1
b,n
Iceland
3
6
4
5
b,n
4
b,n
3.7
0.0
0.0
0.0
0.0
b,n
0.0
b,n
Ireland Italy Japan Korea
27
31
37
56
b,n
45
b,n
5.8
0.1
0.1
0.1
0.1
b,n
0.1
b,n
659
610
711
740
b,n
767
b,n
1.7
2.2
1.7
1.7
1.7
b,n
1.8
b,n
8 895
9 428
11 207
11 726
b,n
11 757
b,n
3.1
29.7
26.6
26.6
26.9
b,n
26.9
b,n
459
b,n
478
b,n
1.1
b,n
1.1
b,n
93
327
387
18.2
0.3
0.9
0.9
Luxembourg
9
13
16
19
b,n
17
b,n
6.4
0.0
0.0
0.0
0.0
b,n
0.0
b,n
Mexico
6
12
11
11
b,n
15
b,n
10.2
0.0
0.0
0.0
0.0
b,n
0.0
b,n
568
724
840
833
b,n
857
b,n
4.6
1.9
2.0
2.0
1.9
b,n
2.0
b,n
Netherlands New Zealand
19
20
39
33
b,n
36
b,n
7.1
0.1
0.1
0.1
0.1
b,n
0.1
b,n
Norway
58
86
94
108
b,n
109
b,n
7.0
0.2
0.2
0.2
0.2
b,n
0.2
b,n
Poland
9
5
9
8
b,n
10
b,n
0.5
0.0
0.0
0.0
0.0
b,n
0.0
b,n
5
b,n
8
b,n
0.0
b,n
0.0
b,n
Portugal Slovak Republic
3 2
Spain Sweden Switzerland Turkey United Kingdom
2
6
10.2
0.0
0.0
0.0
1
2
4
3
b,n
4
b,n
23.2
-
0.0
0.0
0.0
b,n
0.0
b,n
70
87
108
120
b,n
113
b,n
5.3
0.2
0.2
0.3
0.3
b,n
0.3
b,n
391
700
853
838
b,n
811
b,n
8.1
1.3
2.0
2.0
1.9
b,n
1.9
b,n
723
746
790
792
b,n
753
b,n
0.5
2.4
2.1
1.9
1.8
b,n
1.7
b,n
0
2
3
5
b,n
6
b,n
34.5
0.0
0.0
0.0
0.0
b,n
0.0
b,n
1 250
1 516
1 589
1 767
b,n
1 794
b,n
4.0
4.2
4.3
3.8
4.0
b,n
4.1
b,n
34.6
b,n
34.3
b,n
United States
10 217
12 312
14 763
15 079
b,n
Total OECD
29 607
35 070
41 459
42 738
b,n
42 739
b,k,n
4.1
98.9
98.8
98.5
97.9
b,n
97.9
b,n
9 168
11 533
13 343
13 687
b,n
13 770
b,n
4.5
30.6
32.5
31.7
31.4
b,n
31.5
b,n
13 627
b,n
13 699
b,n
31.2
b,n
31.4
b,n
43 664
b,n
4.2
100
100
100
100
b,n
100
b,n
93
b,n
22.9
0.0
0.1
0.1
0.2
b,n
0.2
b,n
342
b,n
0.8
b,n
0.8
b,n
76
b,n
0.2
b,n
0.2
b,n
EU-25 EU-15 Total world China Israel Russian Federation
9 122
11 489
13 283
29 923
35 501
42 097
43 635
b,n
12
19
41
66
b,n
347
b,n
71
b,n
104
158
37
62
284 65
14 985
b,k,n
4.3
34.1
4.5
13.2 7.9
30.5
0.3 0.1
34.7
32.4
0.4 0.2
35.1
31.6
0.7 0.2
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. Patent filed at the European Patent Office (EPO), the US Patent & Trademark Office (USPTO) and the Japanese Patent Office (JPO). 2. 1992 instead of 1991.
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/482445177814
219
© OECD 2004
OECD Science, Technology and Industry Outlook 2004
Table 26. Number of triadic1 patent families by priority year, 1991-2000 Per million inhabitants
Australia Austria
1991
1993
1995
1997
1999
9.0
10.8
12.4
16.0
16.0
b,n
16.7
b,n
32.7
b,n
34.2
b,n
35.1
b,n
22.3
21.7
27.3
31.1
2000
Belgium
23.9
32.6
36.4
38.8
35.8
b,n
Canada
9.8
10.5
13.0
17.5
17.7
b,n
16.9
b,n
0.9
b,n
0.9
b,n
47.0
b,n
47.7
b,n
81.1
b,n
94.5
b,n
34.5
b,n
35.1
b,n
71.5
b,n
70.3
b,n
0.6
b,n
Czech Republic
0.9
Denmark
0.7
20.4
Finland
30.7
32.1
France
46.0
41.9
61.0
28.7 a
0.9
35.9
48.3
30.5
Germany
0.3
80.9
32.1
49.1
36.8
59.0
68.7
Greece
0.5
0.3
0.1
0.8
0.4
b,n
Hungary
2.1
2.2
2.4
3.0
2.9
b,n
3.3
b,n
17.2
b,n
14.9
b,n
14.8
b,n
11.9
b,n
12.8
b,n
13.3
b,n
92.6
b,n
92.6
b,n
10.2
b,n
Iceland
11.6
Ireland
7.6
Italy
11.0
71.8
Korea Luxembourg Mexico
2
Spain Sweden Switzerland Turkey United Kingdom
9.8
24.1
36.1
31.8
37.8
44.2
b,n
37.8
b,n
0.1
b,n
0.1
b,n
52.7
b,n
53.8
b,n
8.5
b,n
9.2
b,n
24.2
b,n
24.2
b,n
0.2
b,n
0.3
b,n
0.8
b,n
0.1 39.0
0.1
46.8
3.1
53.9
5.5
16.3
10.2
19.7
0.3
21.4
0.1
0.2
0.3
0.4
0.2
0.6
0.5
0.1
0.2
0.4
0.8
0.6
b,n
0.8
b,n
3.0
b,n
2.8
b,n
94.6
b,n
91.4
b,n
110.5
b,n
104.5
b,n
0.1
b,n
0.1
b,n
30.2
b,n
30.6
b,n
54.1
54.0
b,n
53.1
b,k,n
37.5
38.1
b,n
37.8
b,k,n
30.4
b,n
30.4
b,n
36.2
b,n
1.8
1.9
45.4
-
EU-15
24.9
China
0.0
40.5
46.2
31.4
32.2
26.4
0.1
26.2
a
111.1
0.0
23.5
a
96.5
105.4
0.0
21.8
2.8
79.3
101.0
0.0
31.3
2.2
57.5
105.0
Total OECD
Russian Federation
0.1
b,n
40.3
Israel
88.8 8.4
United States
EU-25
75.1 7.2
0.2
Portugal
12.4
3.8
13.6
Poland
10.6
2.1
5.3
Norway
10.1
b,n
37.7
New Zealand
12.9
8.6 a
67.8
0.1
Netherlands
22.4
5.2
11.6
Japan
Slovak Republic
3.8
25.8 a
0.0
27.3
a
29.7
30.8
35.5
36.2
b,n
0.0
0.0
0.1
b,n
0.1
b,n
54.5
b,n
0.5
b,n
21.1
23.3
28.5
48.8
56.7
b,n
0.2
0.2
0.4
0.4
0.5
b,n
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. Patent filed at the EPO, the USPTO and the JPO. 2. 1992 instead of 1991.
220
Source: OECD, MSTI database, May 2004.
StatLink: http://dx.doi.org/10.1787/366528340153
© OECD 2004
Statistical Annex
Table 27. Science and engineering articles by country, 1988-2001 Per million inhabitants
Australia
1988
1991
1995
1999
2000
2001
593
618
736
797
763
758
Austria
294
353
437
527
532
564
Belgium
362
416
519
580
560
582
Canada
798
817
836
768
743
727
Czech Republic1
265
279
193
231
239
256
Denmark
672
733
843
923
923
931
Finland
564
640
809
943
942
983
372
402
493
532
511
514
France 2
Germany
477
412
467
531
529
530
Greece
121
153
194
249
265
304
Hungary
164
175
177
226
224
243
Iceland
276
403
591
491
548
610
Ireland
224
260
336
406
420
432
Italy
198
243
312
361
364
385
-
-
-
-
437
451 233
Japan Korea
18
31
84
180
200
Mexico
11
13
21
30
30
32
Netherlands
581
671
798
800
783
786
New Zealand
620
598
665
760
784
742
Norway
521
564
678
701
711
721
Poland
106
102
117
134
138
147
43
65
99
174
177
208
Portugal Slovak Republic
-
-
212
185
186
177
Spain
140
187
289
375
370
387
Sweden
898
945
1 052
1 143
1 106
1 159
Switzerland
797
886
1 040
1 158
1 173
1 117
9
15
28
49
52
60
United Kingdom
Turkey
641
696
794
837
844
807
United States
725
766
762
711
696
705
Total OECD
468
468
454
447
466
461
EU-25
-
-
432
482
479
485
EU-15
389
416
499
555
550
556
China3
-
5
8
13
14
16
Israel
-
985
1 068
994
1 004
1 007
Russian Federation4
-
-
135
118
126
110
1. Includes articles from the former Czechoslavakia before 1996. 2. Includes articles from the former East Germany before 1992. 3. Includes articles from the Hong Kong economy before 2000. 4. Includes articles from the former USSR.
Source: NSF, Science and Engineering Indicators 2004. Population from OECD, MSTI database, May 2004. StatLink: http://dx.doi.org/10.1787/871586367658
© OECD 2004
221
As a percentage of total publications
All fields
Clinical
Biomedical
(total number)
medicine
research
1988
2001
Australia
9 896
14 788
29.9
28.7
Austria
2 241
4 526
42.1
42.5
Belgium Canada Czech Republic
2
Denmark
1988
2001
1988
Biology
Chemistry
1988
2001
Physics
1988
2001
Earth & space
Engineering &
sciences
technology
1988
2001
1988
2001
Mathematics
Psychology
Other1
Social sciences
2001
1988
2001
1988
2001
1988
2001
1988
2001
1988
2001
13.8
13.1
16.1
14.7
8.2
6.8
7.1
6.9
6.3
7.8
4.5
6.6
2.2
1.7
5.2
4.8
3.3
3.7
3.4
5.3
10.6
13.0
6.3
5.6
13.8
10.0
12.4
11.3
2.5
4.6
4.4
6.1
2.4
2.7
2.8
2.2
1.4
1.2
1.3
0.9
3 586
5 984
38.4
32.9
17.1
14.6
5.4
8.0
10.4
11.0
11.9
12.5
3.0
4.5
5.5
7.8
2.3
2.1
2.8
2.7
1.7
2.0
1.6
2.0
21 391
22 626
25.9
29.3
14.3
15.2
14.6
10.3
8.1
7.8
8.0
6.6
5.8
7.3
8.1
7.9
2.3
1.9
4.6
4.7
4.4
4.4
3.9
4.6
2 746
2 622
16.5
14.5
13.9
16.0
4.6
7.7
29.0
22.9
14.5
16.2
3.6
4.5
5.3
8.2
1.5
3.9
7.9
3.1
2.9
1.5
0.4
1.3
3 445
4 988
54.6
34.2
15.9
17.9
6.0
11.7
4.8
7.8
8.6
9.3
2.6
6.2
2.3
5.3
1.7
1.4
1.7
3.3
1.1
1.0
0.8
1.9 3.9
Finland
2 789
5 098
51.1
37.8
14.3
14.1
7.1
10.1
6.1
7.5
7.0
8.5
3.7
5.5
4.3
7.3
1.8
1.3
1.6
1.8
1.4
1.8
1.7
France
21 409
31 317
29.1
27.1
16.6
15.2
5.9
5.7
15.3
12.9
17.2
16.1
4.7
6.6
4.7
9.0
3.0
4.4
1.8
1.4
1.1
0.9
0.5
0.7
Germany3
25 666
43 623
29.0
30.9
15.4
14.1
6.2
5.2
15.7
12.7
16.5
16.3
3.3
5.0
6.7
8.5
2.2
2.2
1.8
1.8
2.3
2.0
1.0
1.3
Greece
1 239
3 329
20.4
31.3
8.1
8.1
9.3
9.2
14.7
12.5
16.3
14.1
7.9
6.3
14.7
11.4
4.3
3.0
2.4
2.1
0.6
0.5
1.1
1.5
Hungary
1 714
2 479
21.2
26.7
19.5
13.1
3.7
5.2
27.3
23.5
12.0
15.0
1.7
2.8
4.3
7.0
6.2
3.9
2.2
1.6
0.7
0.8
1.2
0.4
Iceland
69
174
45.0
31.9
12.3
10.2
6.2
16.2
0.0
3.3
3.4
4.6
17.6
16.2
2.2
2.9
2.2
2.1
1.5
5.8
3.6
3.9
6.1
3.0
Ireland
790
1 665
35.8
30.7
11.9
14.6
11.9
14.0
9.2
8.4
8.7
10.3
4.7
3.0
3.9
6.9
4.5
2.4
5.8
4.1
1.5
1.7
2.2
4.1
Italy
11 229
22 313
38.0
35.1
13.4
12.0
3.8
4.5
15.4
11.9
16.2
16.2
3.6
6.0
5.2
8.8
2.3
2.9
1.0
1.3
0.8
0.7
0.4
0.6
Japan
34 435
57 420
25.6
28.7
15.2
14.0
6.9
6.1
17.7
14.9
19.1
19.1
1.9
3.0
11.1
11.6
1.4
1.4
0.5
0.5
0.5
0.5
0.1
0.2
Korea
771
11 037
10.0
17.9
4.6
11.3
3.7
3.3
30.5
17.7
18.2
22.4
1.5
3.0
24.9
20.7
2.7
1.7
2.5
1.0
0.1
0.3
1.3
0.8
Mexico
884
3 209
24.5
18.7
14.9
12.0
15.7
14.8
11.1
10.5
15.7
21.2
6.5
7.6
4.0
7.7
3.4
2.1
2.7
1.7
1.2
1.5
0.5
2.3
Netherlands
8 581
12 602
36.6
37.5
15.5
14.2
8.2
6.0
10.8
8.6
11.9
8.8
4.1
5.5
4.3
6.4
1.5
1.4
2.7
3.9
2.7
3.6
1.6
4.0
New Zealand
2 075
2 903
28.4
25.9
10.1
10.5
28.6
23.6
6.1
5.7
4.6
4.2
6.1
9.3
3.8
5.2
1.5
1.8
3.2
4.4
4.6
4.4
2.9
5.0
Norway
2 192
3 252
40.3
33.4
13.8
12.7
12.8
12.9
8.0
6.3
4.9
5.0
6.4
10.1
4.4
6.2
2.1
2.3
3.9
4.4
2.2
3.1
1.2
3.7
Poland
4 030
5 686
12.4
13.2
9.3
8.6
5.3
4.8
27.1
26.7
28.4
26.5
1.9
4.1
9.1
11.0
4.4
3.9
1.0
0.5
0.6
0.3
0.7
0.5
429
2 142
15.7
14.5
11.4
12.5
6.4
11.0
17.6
20.5
20.1
16.8
5.0
4.7
16.0
13.1
2.4
3.5
2.2
1.4
0.9
0.9
2.4
1.1
-
955
-
12.2
-
17.5
-
4.8
-
22.5
-
15.9
-
3.4
-
8.5
-
3.4
-
8.2
-
3.2
0.0
0.4
Spain
5 432
15 570
23.3
24.7
18.8
13.9
8.9
10.7
23.8
18.5
12.4
11.7
3.3
5.7
4.2
7.8
3.1
3.3
1.1
1.7
0.7
0.9
0.4
1.0
Sweden
7 573
10 314
48.2
36.7
17.2
15.5
6.9
7.4
7.5
8.3
7.5
10.5
3.2
4.4
3.9
8.1
1.2
1.2
1.8
1.9
1.2
1.7
1.4
4.2
Switzerland
5 316
8 107
36.3
32.7
18.5
16.1
4.1
5.8
11.9
12.8
16.5
13.4
2.7
6.4
4.2
6.6
1.6
1.4
1.7
2.1
1.7
1.4
0.9
1.3
507
4 098
33.1
44.3
6.0
6.3
5.4
5.2
15.8
14.2
12.4
8.9
6.2
4.6
13.4
11.2
3.3
1.3
2.6
1.9
0.9
1.1
1.1
1.1
Portugal Slovak Republic
Turkey United Kingdom United States
36 509
47 660
36.6
32.8
14.8
14.2
7.4
6.2
9.9
8.5
9.1
9.0
4.0
5.9
6.3
7.4
1.5
1.6
4.5
5.7
2.4
3.0
3.7
5.7
177 662
200 870
31.0
31.7
15.5
16.9
7.2
6.2
7.4
7.1
10.1
8.7
4.5
5.6
6.7
6.9
2.2
1.8
4.9
4.7
4.0
3.9
6.4
6.4
Total OECD
398 238
551 402
31.1
30.7
15.2
15.0
7.7
6.8
10.8
10.3
12.0
11.9
4.1
5.4
6.7
8.2
2.1
2.0
3.7
3.3
2.8
2.6
3.8
3.8
EU-254
143 034
138 116
21.2
10.6
14.2
7.0
5.2
3.3
24.2
26.7
16.9
32.6
2.8
4.9
6.2
8.9
3.6
3.8
3.4
0.9
1.4
0.5
0.9
0.7
EU-154
134 544
137 368
34.8
28.2
14.3
12.7
7.2
7.6
13.4
14.3
12.7
12.6
3.8
5.1
6.2
10.0
2.4
2.9
2.3
3.0
1.4
1.3
1.4
2.4
4 001
20 978
13.8
10.7
6.7
8.0
2.9
3.8
13.0
26.3
39.1
23.4
5.1
4.4
13.0
16.3
3.9
3.9
0.1
1.1
1.7
0.5
0.6
1.7
4 916
6 487
33.6
32.9
13.6
12.7
8.8
6.9
5.8
7.6
13.7
13.6
3.4
3.4
6.2
8.3
3.5
4.0
4.7
3.5
3.1
3.3
3.7
3.9
31 625
15 846
14.3
3.2
17.7
7.5
2.6
4.0
27.1
27.1
27.6
35.6
4.1
8.1
4.1
8.9
0.9
3.4
0.6
1.3
0.6
0.6
0.4
0.3
China Israel Russian Federation
5
© OECD 2004
1. Other: Health sciences and professional fields. 2. Czechoslavakia instead of the Czech Republic in 1988. 3. Western Germany only in 1988. 4. Average for countries available. 5. Former USSR instead of Russian Federation in 1988.
Source: US National Science Foundation, Science and Engineering Indicators 2004.
StatLink: http://dx.doi.org/10.1787/581733703880
OECD Science, Technology and Industry Outlook 2004
222 Table 28. Portfolio of S&E articles by field, 1988-2001
© OECD 2004
Table 29. Technology balance of payments, 1981-2002 Millions current USD
Receipts 1981
1985
1991
Payments
1995
2001
2002
1981
1985
-
142
-
99
k
114
a
1991
Balance
1995
2001
2002
1981
1985
1991
1995
2001
2002
-
- 129
- 120
- 170
- 215
-
-
-
- 75
- 84
- 222
- 233
4
-
Australia1,2, 3
14
Austria4
24
k
30
Belgium
622
a
694
1 945
3 758
5 709
-
727
800
2 380
3 080
4 641
-
- 105
- 106
- 435
677
1 068
Canada
157
399
929
1 283
2 034
-
416
550
928
1 008
1 051
-
- 259
- 151
1
275
983
-
-
-
-
-
487
451
-
-
-
-
554
781
-
-
-
-
- 67
- 330
Czech Republic Denmark
68
200 k
79
k
128
-
1 907
2 430 a
-
107
184
-
-
-
-
71
Finland
5
4
54
58
1 303
1 468
87
France
906
894
1 742
2 170
3 196
-
Germany
934
1 171
6 282
10 633
14 306
15 756
Hungary3
n
188
370 k
161 k
107
301
k
k
311
344
-
2 140
2 426 a
k
390
k
-
-
-
36
23
-
-
-
-
1 060
1 231
- 82
- 102
- 257
- 332
243
237
991
1 064
2 451
2 988
2 695
-
1 479
1 650
7 979
13 170
20 942
21 295
n
- 85
- 170
- 709
- 818
501
-
- 545
- 479
-1 697
-2 537
-6 636
-5 539
-
-
-
181
-
-
-
-
-
215
-
-
-
-
-
- 35
-
-
Italy
198
144
1 410
3 051
2 684
2 978
570
546
2 366
3 437
3 440
2 993
- 372
- 402
- 956
- 386
- 756
- 15
Japan
794
982
2 751
5 976
10 259
-
1 177
1 229
2 930
4 165
4 512
-
Mexico
33
14
79
118
41
48
273
163
420
487
419
664
387
1 196
4 876
-
-
-
593
1 503
5 933
-
-
-
-
21
20
-
-
-
-
15
8
-
348
496
1 382
1 379
76
Netherlands New Zealand
k
k
n
k
k
- 383
- 247
- 179
1 811
5 747
-
- 241
- 149
- 341
- 369
- 378
- 616
-
- 206
- 308
-1 057
-
-
-
-
-
-
5
12
-
190
n
Norway
44
438
928
1 246
1 189
- 33
- 48
- 90
- 431
136
Poland
-
-
-
231
177
-
-
-
-
234
795
-
-
-
-
-3
- 618
-
Portugal
-
-
-
139
282
385
-
-
-
537
597
693
-
-
-
- 398
- 316
- 308 -
Slovak Republic Spain Sweden Switzerland United Kingdom United States Russian Federation
28
q
n,q
77
q
n,q
-
-
-
9
-
-
-
-
27
-
-
-
-
- 17
- 34
181
137
641
79
-
-
567
552
2 276
1 110
-
-
- 387
- 414
-1 635
-1 031
-
-
68
87
217
-
-
-
64
49
116
-
-
-
4
38
102
-
-
84
a
30
-
870
1 941
2 778
3 233
965
1 038
2 333
4 218
17 105
7 284
6 678
17 819
30 289
41 098
44 142
-
-
-
-
242
211
n
a
65
4 334
-
233
745
1 262
3 251
-
798
923
2 302
3 530
7 713
650
1 170
4 035
6 919
16 713
19 258
-
-
-
-
398
577
n
n
4 250
-
637
1 196
1 516
- 18
-
167
115
32
688
9 392
-
6 634
5 508
13 784
23 370
24 385
24 884
-
-
-
-
- 157
- 366
n
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1986 instead of 1985.
2. 1992 instead of 1991.
4. 2000 instead of 2001.
StatLink: http://dx.doi.org/10.1787/525456707887
223
Statistical Annex
Source: OECD, MSTI database, May 2004.
3. 1996 instead of 1995.
OECD Science, Technology and Industry Outlook 2004
Table 30. Technology balance of payments, 1981-2002 Payments as a percentage of GERD
1981 Australia1, 2, 3 Austria
4
Belgium
5
Canada Czech Republic
1985
7.8
1991
8.3
12.8
k
53.2
a
13.7
7.8 k
12.1
b
68.5
64.9
a
94.0
-
9.9
10.1
7.4
-
-
-
-
-
74.4
86.6
8.6
9.0
8.5
Germany
8.8
9.7
17.9
Hungary3
-
-
-
22.2 a,k a
16.0
r
4.3
k
12.6
b,k
11.4
r
3.3
k
12.4
-
-
-
k
25.6
27.1
9.2
-
23.9
b
45.0
42.5
73.3
c
-
-
a,k
13.2
a
8.3
16.6
a
31.3
2.9
k
2.7
99.8
-
-
-
-
3.7
1.4
-
-
22.5
36.9
a
45.8
37.3
a
67.0
-
8.1
k
-
26.7
Portugal
-
-
-
88.1
United Kingdom United States Russian Federation
-
57.1
-
Turkey
17.1
-
-
Switzerland1, 2, 3, 4
-
22.3
Poland
Sweden
-
3.5
-
k
55.0
28.3
-
10.4
Slovak Republic
k
-
Norway
Spain
-
72.5
France
New Zealand
58.5
b
59.5
11.4
Netherlands
b
10.9
14.4
Mexico
2002
11.3
Finland
Japan
2001
5.0 b,k
Denmark
Italy
1995
64.3 c,q
48.5
-
-
-
14.8
71.9
60.4
49.3
23.4
-
-
-
1.7
j
-
8.6
a
-
-
2.4
a,j
6.6
a
0.9
h
-
9.0
a
1.0
h
-
1.7
a,j
61.2 j,n,q
-
-
13.9
17.7
30.4
-
-
-
10.8
15.9
29.0
n
-
6.1
h
7.0
2.5
h
-
3.8 -
h
11.1
n
h,n
13.4
Times series notes: (a) to (r): See standard statistical notes for science and technology indicators earlier in the Annex.
Year availability: 1. 1986 instead of 1985.
3. 1996 instead of 1995.
2. 1992 instead of 1991.
4. 2000 instead of 2001.
Source: OECD, MSTI database, May 2004.
5. 1983 instead of 1981.
StatLink: http://dx.doi.org/10.1787/507503146810
224
© OECD 2004
© OECD 2004
Table 31. Share of value added in total gross value added, 1991-2001
Australia
(ISIC Rev.3)
Austria
Belgium
Canada
Czech Republic
Denmark
Finland
France
Germany
Greece
Iceland
Ireland
1991
2000
1991
2001
1992
2001
1991
2000
1992
2001
1991
1999
1991
2001
1991
2000
1991
2001
1991
2001
1991
2001
1991
1999
21.6
20.6
20.1
18.7
15.8
19.9
29.1
27.5
17.0
16.3
19.6
24.5
19.9
18.1
27.4
22.4
14.8
11.9
15.9
-
26.6
33.7
2.9
2.3
2.7
2.5
2.6
2.1
4.7
3.8
1
3.2
2.7
2.7
1.6
2.9
2.4
2.3
2.0
2.8
2.6
7.9
-
6.9
Total manufacturing
(15-37)
13.5
12.0
Food prod., beverages and tobacco
(15-16)
2.4
2.6
1
5.4
Textiles, textile prod., leather and footwear
(17-19)
0.8
0.6
1
1.4
0.8
1.4
1.0
0.8
0.8
3.6
1.6
1
0.8
0.5
0.8
0.4
1.3
0.8
1.0
0.5
4.1
1.9
0.6
-
1.2
0.5
Wood, pulp, paper, paper prod., printing & publishing
(20-22)
2.1
2.1
1
2.8
3.0
1.8
1.8
2.8
4.2
2.0
2.6
1
2.3
2.2
5.1
6.5
2.1
1.8
2.5
2.1
1.4
1.2
1.9
0.0
3.4
6.0
Chemical, rubber, plastics and fuel prod.
(23-25)
2.1
1.8
1
2.4
2.7
4.5
4.9
2.6
2.5
3.0
2.8
1
2.2
2.7
2.5
2.6
3.3
3.6
4.1
3.7
1.7
2.0
1.1
-
5.3
11.3
….Coke, refined petroleum prod. and nuclear fuel
(23)
0.4
0.2
1
0.3
0.8
0.5
0.6
0.4
0.3
0.5
0.2
1
0.0
0.0
0.6
0.4
0.6
0.8
0.2
0.4
0.5
0.9
-
-
0.0
0.0
….Chemicals and chemical prod.
(24)
1.1
1.0
1
1.3
1.1
3.3
3.6
1.5
1.4
1.6
1.4
1
1.4
1.8
1.3
1.4
1.8
2.0
2.7
2.2
0.8
0.7
0.6
-
4.5
10.7
……..Chemicals excluding pharmaceuticals
(24ex2423)
-
-
0.9
0.8
2.6
-
1.2
1.1
-
1.2
1
0.7
0.7
1.0
1.1
1.3
1.3
2.2
1.7
0.6
-
-
-
3.7
8.4
……..Pharmaceuticals
(2423)
-
-
0.5
0.4
0.7
-
0.4
0.3
-
0.2
1
0.7
1.1
0.3
0.3
0.5
0.7
0.5
0.5
0.2
-
-
-
0.8
2.3
….Rubber and plastics prod.
(25)
0.6
0.6
1
0.8
0.8
0.8
0.7
0.6
0.9
0.8
1.1
1
0.8
0.8
0.6
0.8
0.9
0.8
1.3
1.1
0.4
0.3
0.5
-
0.8
0.6
Other non-metallic mineral prod.
(26)
0.7
0.7
1
1.5
1.2
1.1
1.0
0.4
0.5
1.8
1.9
1
0.7
0.8
0.9
0.8
1.0
0.8
1.0
0.8
0.9
0.9
0.9
-
1.1
0.8
3.1
2.5
4.4
Basic metals and fabricated metal prod.
(27-28)
2.6
1.9
1
3.2
3.3
1.8
2.6
4.4
1
1.8
1.7
2.1
2.7
2.7
2.4
3.6
2.9
1.4
1.1
1.4
-
1.2
0.8
Machinery and equipment
(29-33)
1.4
1.3
1
5.1
4.9
2.9
2.7
2.1
2.9
5.4
5.7
1
4.1
4.1
4.0
8.5
3.9
3.5
8.4
6.3
0.9
0.9
0.8
-
5.9
7.8
….Machinery and equip., n.e.c.
(29)
0.7
0.6
1
2.5
2.3
1.3
1.2
0.9
1.3
3.6
2.7
1
2.5
2.3
2.4
2.8
1.6
1.3
4.0
3.4
0.3
0.4
-
-
1.1
0.8
….Electrical and optical equipment
(30-33)
0.7
0.7
1
2.6
2.5
1.6
1.5
1.2
1.6
1.9
3.0
1
1.6
1.8
1.6
5.7
2.3
2.2
4.4
3.0
0.5
0.5
-
-
4.8
7.0
……..Office, accounting and computing machinery
(30)
-
-
0.0
0.1
-
-
0.1
0.1
0.0
0.1
1
0.1
0.1
0.1
0.0
0.3
0.2
0.6
0.2
0.0
0.0
-
-
2.3
3.0
……..Electrical machinery and apparatus, nec
(31)
-
-
0.9
1.0
-
-
0.4
0.4
1.4
1.7
1
0.6
0.6
0.7
0.8
0.8
0.8
2.2
1.5
0.1
0.2
-
-
0.8
0.7
……..Radio, television and communication equipment
(32)
-
-
1.2
1.1
-
-
0.7
1.1
0.2
0.6
1
0.4
0.5
0.5
4.3
0.5
0.6
0.7
0.4
0.3
0.2
-
-
0.6
2.1
0.6
1
0.5
0.6
0.3
0.6
0.7
0.6
0.9
0.9
0.1
0.0
-
-
1.1
1.2
……..Medical, precision and optical instruments
(33)
-
-
0.4
0.4
-
-
-
-
0.2
Transport equipment
(34-35)
1.1
1.1
1
1.0
1.3
1.9
1.7
2.0
3.4
2.9
1
0.7
0.5
0.9
0.9
1.9
2.1
3.6
3.6
0.7
0.6
0.8
-
0.7
0.5
….Motor vehicles, trailers and semi-trailers
(34)
0.7
0.7
1
0.8
1.1
-
-
1.4
2.5
2.4
2.4
1
0.3
0.2
0.3
0.3
1.4
1.5
3.1
3.1
0.1
0.1
-
-
0.3
0.2
….Other transport equipment
(35)
0.3
0.4
1
0.2
0.2
-
-
0.6
0.9
0.3
0.5
1
0.4
0.2
0.6
0.6
0.5
0.6
0.5
0.5
0.6
0.5
-
-
0.4
0.3 0.0
2.7
……..Building and repairing of ships and boats
(351)
-
-
0.0
0.0
-
-
0.1
0.1
-
0.0
1
0.4
0.2
0.4
0.4
0.1
0.1
0.1
0.1
-
-
-
-
0.1
……..Aircraft and spacecraft
(353)
-
-
-
-
-
-
0.4
0.6
-
0.2
1
-
-
0.1
0.1
0.3
0.5
0.3
0.3
-
-
-
-
0.0
0.0
……..Railroad equip. and transport equip. n.e.c.
(352+359)
-
-
0.2
0.2
-
-
0.1
0.2
-
0.3
1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
-
-
-
-
0.3
0.3
1
0.7
Manufacturing nec; recycling
(36-37)
0.5
0.4
1.2
1.1
0.7
0.6
0.6
0.9
1.3
1.3
1.2
1.0
0.7
0.6
0.9
0.7
0.8
0.6
1.0
0.8
0.7
-
1.0
Electricity, gas and water supply
(40-41)
3.6
2.5
2.8
2.2
2.9
2.6
3.3
2.8
6.3
4.0
2.3
2.2
2.3
1.8
2.4
2.0
2.3
1.9
2.6
1.8
3.5
-
2.4
1.3
Construction
(45)
6.1
5.7
7.3
7.4
5.5
4.9
6.3
5.0
6.9
7.1
4.8
5.3
7.5
5.7
6.0
4.6
5.9
4.8
7.5
8.3
8.8
-
5.4
6.6
Total services
(50-99)
68.2
70.6
64.6
67.1
69.3
72.3
68.3
64.1
49.1
55.8
71.0
72.1
64.8
64.2
68.4
72.5
62.2
69.4
62.8
70.4
60.0
-
56.3
53.9
Wholesale and retail trade; restaurants and hotels
(50-55)
13.6
13.3
17.7
16.6
14.9
13.4
14.0
13.3
14.2
17.0
14.6
14.5
12.3
11.4
13.7
12.8
11.9
12.0
18.5
20.7
14.8
-
14.7
12.2
Transport and storage and communication
(60-64)
9.0
8.4
7.8
7.1
6.9
6.9
7.3
6.8
6.1
8.2
7.5
7.6
9.4
10.5
6.4
6.3
5.8
6.2
6.6
8.4
7.2
-
5.9
5.5
Transport and storage
(60-63)
5.9
5.3
5.4
4.8
-
-
4.2
4.1
4.7
-
5.5
5.3
7.1
7.1
4.1
4.2
3.5
3.8
-
5.2
5.7
-
3.4
-
Post and telecommunications
(64)
3.0
3.2
2.5
2.2
-
-
3.1
2.7
1.5
-
2.1
2.3
2.3
3.4
2.3
2.1
2.4
2.4
-
3.2
1.5
-
2.5
-
Finance, insurance, real estate and business services
(65-74)
25.9
29.3
18.4
23.5
24.6
28.0
23.9
24.7
17.2
15.7
22.8
23.2
18.0
21.0
27.1
30.4
24.2
29.8
19.5
21.2
17.2
-
15.8
20.0
Financial intermediation
(65-67)
6.5
7.4
6.8
6.6
6.2
5.3
6.3
7.1
6.6
3.6
4.8
5.0
4.3
3.8
5.0
5.1
5.0
3.8
-
5.7
5.3
-
3.3
4.5
Real estate, renting and business activities
(70-74)
19.4
21.9
11.6
16.8
18.4
22.7
17.6
17.6
10.5
12.1
18.0
18.2
13.7
17.2
22.1
25.3
19.2
26.0
-
15.5
11.9
-
12.5
15.5
….Real estate activities
(70)
9.9
9.8
6.6
8.3
-
-
12.2
10.8
4.6
-
11.1
10.7
9.1
10.4
11.0
11.9
9.3
12.4
-
12.2
7.9
-
-
….Renting of m&eq and other business activities
(71-74)
9.6
12.1
5.0
8.5
-
-
5.4
6.8
5.9
-
6.9
7.5
4.6
6.8
11.1
13.4
9.9
13.6
-
3.3
4.0
-
-
-
……..Other business activities
(74)
-
-
3.6
5.6
-
-
-
-
4.3
-
5.0
5.4
2.9
4.2
7.3
9.2
7.3
9.5
-
2.7
-
-
-
-
Community social and personal services
(75-99)
16.1
-
19.7
19.6
20.7
20.0
23.0
24.1
23.1
19.3
11.6
15.0
26.0
26.7
25.1
21.2
21.2
23.1
20.3
21.4
18.2
20.2
20.8
-
19.9
High technology manufactures
0.8
0.9
1
2.1
1.9
-
-
1.6
2.1
0.4
1.7
1
1.7
2.3
1.3
5.2
2.3
2.5
2.9
2.3
-
-
-
-
4.8
8.6
Medium-high technology manufactures
2.7
2.3
1
5.3
5.4
-
-
4.0
5.5
7.4
8.3
1
4.1
3.9
4.5
5.1
5.1
5.0
11.6
9.7
-
-
-
-
6.1
10.4
1
Medium-low technology manufactures
4.3
3.6
Low technology manufactures
5.7
5.6
High and medium-high technology manufactures
3.6
3.3
1
-
3.5
4.3
7.6
7.7
1
3.7
3.6
4.5
5.0
5.3
4.9
5.2
3.5
-
-
-
3.1
2.2
8.3
7.2
6.6
5.9
6.8
8.0
11.7
9.2
1
7.6
6.5
9.3
9.2
7.1
5.7
6.6
5.2
9.3
6.4
11.0
-
12.5
12.5
7.4
7.3
8.0
8.0
5.6
7.7
9.8
10.0
1
6.2
6.4
6.2
10.8
7.6
7.6
14.6
12.1
2.4
2.2
2.1
-
11.0
19.0
5.8
6.1
-
6.2
1. Intensity of the previous year. 2. 1998 instead of 1995. 3. EU includes the 15 EU Members before 1 May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available). 4. OECD includes previous EU countries and Canada, Japan, and the United States.
Source: OECD, STAN Indicators 2004.
StatLink: http://dx.doi.org/10.1787/005860125823
Statistical Annex
225
Japan
Korea
Netherlands
Norway
Poland
Spain
1991
2001
1991
2001
1995
2001
1991
2000
1991
1998
1994
2001
Total manufacturing
(15-37)
22.5
20.1
25.8
20.1
29.2
30.3
18.2
16.0
12.1
13.0
21.7
17.9
Food prod., beverages and tobacco
(15-16)
2.4
2.0
2.5
2.4
3.0
3.4
3.2
3.0
2.1
1.9
3.5
3.8
Textiles, textile prod., leather and footwear
(17-19)
3.4
2.9
1.3
0.6
2.1
1.4
0.6
0.4
0.3
0.2
2.6
1.5
Wood, pulp, paper, paper prod., printing & publishing
(20-22)
2.1
2.0
2.3
1.9
1.7
1.4
2.5
2.3
2.5
2.5
2.3
2.5
Chemical, rubber, plastics and fuel prod.
(23-25)
2.9
2.7
3.4
3.3
5.7
7.5
3.6
3.2
1.5
1.5
3.4
3.1
….Coke, refined petroleum prod. and nuclear fuel
(23)
0.5
0.2
1.0
1.3
1.8
3.4
0.5
0.4
-
-
0.7
0.6
….Chemicals and chemical prod.
(24)
1.7
1.6
2.0
1.7
2.9
2.9
2.5
2.3
-
-
1.7
1.4
……..Chemicals excluding pharmaceuticals
(24ex2423)
1.0
0.9
1.4
1.0
2.0
1.9
2.2
1.9
-
-
-
1.1
……..Pharmaceuticals
(2423)
0.6
0.7
0.6
0.7
0.9
1.0
0.3
0.4
0.2
0.2
-
0.3
….Rubber and plastics prod.
(25)
0.8
0.8
0.3
0.2
1.0
1.1
0.6
0.5
0.3
0.3
1.0
1.0
Other non-metallic mineral prod.
(26)
1.4
1.4
0.9
0.7
1.3
1.0
0.7
0.7
0.5
0.5
1.4
1.4
Basic metals and fabricated metal prod.
(27-28)
3.1
2.7
3.6
2.3
3.8
3.4
2.3
1.8
1.5
1.9
2.6
2.2
Machinery and equipment
(29-33)
4.8
4.3
7.7
5.5
7.0
6.3
3.2
2.8
1.9
2.3
3.3
3.1
….Machinery and equip., n.e.c.
(29)
2.5
2.4
3.0
1.9
1.8
1.7
1.3
1.3
1.0
1.2
1.9
1.5
….Electrical and optical equipment
(30-33)
2.3
1.9
4.8
3.6
5.2
4.6
1.9
1.5
0.9
1.1
1.4
1.6
……..Office, accounting and computing machinery
(30)
0.1
0.1
0.7
0.5
0.3
0.8
0.1
0.1
0.0
0.0
0.1
0.1
……..Electrical machinery and apparatus, nec
(31)
1.0
0.9
1.3
1.0
0.7
0.4
0.4
0.2
0.5
0.5
0.7
0.7
……..Radio, television and communication equipment
(32)
0.6
0.5
2.3
1.8
3.9
2.8
0.9
0.8
0.2
0.2
0.4
0.3
……..Medical, precision and optical instruments
(33)
0.5
0.4
0.5
0.3
0.3
0.6
-
-
0.2
0.3
0.3
0.4
Transport equipment
(34-35)
1.3
1.3
2.4
2.3
3.9
5.5
0.8
0.8
1.5
1.8
1.6
1.3
….Motor vehicles, trailers and semi-trailers
(34)
0.8
0.7
2.2
2.0
3.1
3.4
0.3
0.4
0.1
0.2
0.7
0.7
….Other transport equipment
(35)
0.5
0.6
0.2
0.3
0.8
2.2
0.5
0.4
1.4
1.6
0.9
0.6
……..Building and repairing of ships and boats
(351)
0.1
0.2
0.1
0.1
0.7
-
-
0.2
1.2
1.6
-
0.3
……..Aircraft and spacecraft
(353)
0.2
0.3
0.1
0.1
0.1
-
-
0.1
0.1
0.0
-
0.1
……..Railroad equip. and transport equip. n.e.c.
(352+359)
0.1
0.2
0.1
0.1
0.1
-
-
0.1
0.1
0.0
-
0.1
Manufacturing nec; recycling
(36-37)
1.1
1.0
1.6
1.1
0.6
0.4
1.2
1.1
0.4
0.5
1.0
1.0
1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1
Sweden
United Kingdom
EU3
Unites States
4
OECD
1991
2001
1991
2001
1991
2001
1991
2000
1992
1999
1991
1999
19.9
17.4
18.9
20.6
21.0
16.5
17.4
15.5
21.8
20.1
21.0
18.7
3.4
2.5
1.8
1.7
3.1
2.3
1.9
1.5
2.7
2.4
2.4
2.1
1.9
1.3
0.3
0.3
1.3
0.7
0.9
0.5
1.6
1.2
1.3
0.8
2.1
1.9
4.0
4.4
2.8
2.5
2.5
2.1
2.4
2.3
2.4
2.3
3.1
3.0
2.4
3.2
3.8
2.8
3.0
2.7
3.3
3.2
3.2
3.1
0.6
0.5
0.3
0.2
0.5
0.3
0.5
0.4
-
0.3
-
0.5
1.7
1.6
1.6
2.4
2.2
1.7
1.9
1.7
2.0
2.0
2.0
1.9
1.1
1.1
0.9
0.9
1.6
1.0
1.4
1.1
1.4
1.3
1.4
1.2
0.6
0.5
0.7
1.5
0.7
0.7
0.5
0.7
0.6
0.6
0.6
0.6
0.8
0.8
0.5
0.6
1.0
0.9
0.6
0.6
-
0.9
-
0.7
1.5
1.4
0.6
0.5
0.7
0.5
0.4
0.4
1.1
1.0
0.8
0.7
2.2
2.3
2.5
2.8
2.4
1.7
1.8
1.6
2.7
2.5
2.6
2.2
2.8
2.5
4.4
4.2
4.3
3.4
4.5
4.1
5.0
4.6
5.3
1.3
1.2
2.4
2.7
1.7
1.3
1.5
1.2
2.3
2.1
2.1
1.6
1.6
1.2
1.9
1.5
2.5
2.1
3.0
2.8
2.6
2.5
3.2
2.9
0.2
0.1
0.2
0.7
0.6
0.5
0.8
0.8
0.6
0.6
0.4
1.2
1.0
0.9
0.7
0.4
0.2
0.7
-0.1
0.6
0.6
1.1
1.4
0.6
0.7
1.1
1.3
0.3
0.2
0.5
0.7
0.7
0.6
0.6
0.6
0.7
0.5
2.0
1.8
2.3
2.9
2.1
1.8
1.8
1.9
2.1
2.2
2.1
2.2
1.6
1.5
1.6
2.3
1.1
0.9
0.8
1.2
1.6
1.6
1.4
1.6
0.4
0.3
0.7
0.6
1.0
0.9
1.0
0.7
0.5
0.6
0.7
0.6
0.2
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.4
0.3
0.8
0.6
0.9
0.5
0.3
0.3
0.5
0.4
0.1
0.1
0.2
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.9
0.8
0.5
0.6
0.6
0.7
0.6
0.6
0.8
0.8
0.9
0.8
0.2
0.5
0.3
0.5
0.9
0.3
0.6
0.3
0.2
0.5
4.6
0.4
Electricity, gas and water supply
(40-41)
2.2
2.3
3.1
3.7
2.1
2.8
2.0
1.5
3.4
2.6
3.8
3.7
3.3
2.1
3.3
2.7
2.7
1.8
2.9
2.2
2.5
2.2
2.8
2.5
Construction
(45)
6.2
4.9
9.3
6.9
11.2
8.3
5.8
5.8
4.1
5.1
7.3
7.2
8.7
8.7
6.6
4.4
5.9
5.5
3.9
4.7
6.3
5.4
6.0
5.4
(50-99)
65.2
69.5
59.3
67.9
51.0
53.9
66.1
71.4
63.7
64.6
Wholesale and retail trade; restaurants and hotels
(50-55)
17.0
16.6
13.6
13.2
10.2
#
12.2
15.4
15.2
12.3
11.8
Transport and storage and communication
(60-64)
7.1
7.4
6.5
6.2
7.0
#
6.6
7.0
7.3
11.4
9.6
Transport and storage
(60-63)
5.3
5.0
5.0
4.5
4.6
#
4.3
5.0
4.8
9.1
7.4
Total services
Post and telecommunications
(64)
1.8
2.3
1.5
1.7
2.4
#
2.3
2.0
2.6
2.3
2.2
Finance, insurance, real estate and business services
(65-74)
21.2
26.0
21.2
26.9
19.3
#
19.0
20.3
26.4
18.3
17.5
Financial intermediation
(65-67)
6.1
5.9
5.1
6.3
6.8
#
6.9
4.8
6.3
5.1
4.0
Real estate, renting and business activities
(70-74)
15.1
20.1
16.1
20.6
12.5
#
12.2
15.5
20.0
13.2
13.5
….Real estate activities
(70)
-
10.8
10.3
12.8
8.5
#
8.5
7.3
8.0
8.7
7.7
….Renting of m&eq and other business activities
(71-74)
-
9.4
5.8
7.7
4.0
#
3.7
8.2
12.0
4.5
5.8
……..Other business activities
(74)
Community social and personal services
(75-99)
1 1 1 1 1 1 1 1 1 1
56.1
65.0
62.4
67.9
68.0
70.2
66.0
72.8
72.1
76.2
66.0
69.4
66.6
70.8
20.5
21.8
18.0
19.0
12.0
12.1
14.0
15.1
17.3
18.3
14.3
14.5
15.4
15.8
7.5
7.3
7.2
8.7
8.7
8.2
8.1
7.9
6.5
6.7
6.9
7.0
6.7
6.8
-
-
5.2
-
6.4
5.6
5.0
4.7
3.1
3.2
4.5
-
4.0
-
2.0
-
2.3
2.6
3.1
3.1
3.4
3.5
2.4
-
2.6
-
15.3
18.1
20.0
21.8
25.0
22.2
27.9
25.3
30.0
23.5
26.4
23.4
27.2
1.1
2.2
6.3
5.8
4.9
3.6
5.4
5.3
6.4
8.7
5.5
5.1
5.8
6.6
8.0
13.1
11.8
14.2
17.0
21.4
16.8
22.7
18.9
21.3
18.0
21.3
17.6
20.5
-
-
7.4
-
11.0
10.7
-
9.5
11.5
11.4
-
-
-
-
-
-
4.4
-
6.0
10.6
-
13.1
7.4
9.9
-
-
-
-
-
-
-
-
-
7.4
-
9.1
-
-
-
-
-
-
19.0
20.6
19.1
20.2
25.5
24.9
21.7
21.8
23.0
21.3
21.3
21.6
21.1
21.1
1.6
1.2
2.5
2.5
3.2
2.8
3.8
3.6
2.3
2.4
3.3
3.2
4.8
4.5
5.7
6.9
5.3
3.9
4.3
4.0
6.6
6.2
5.9
5.3
5.3
5.2
4.0
4.2
3.5
3.4
3.1
5.2
4.8
4.7
4.2
8.3
6.5
6.6
7.0
7.8
6.2
5.9
4.8
7.6
6.7
7.0
6.0
6.5
5.9
8.3
9.5
8.6
6.9
8.2
7.7
9.1
8.7
9.4
8.7
-
7.5
-
-
-
#
-
6.2
8.7
3.3
4.1
19.8
19.5
18.0
21.6
15.3
#
16.1
23.4
22.5
21.7
21.5
High technology manufactures
2.1
2.0
4.2
3.4
5.4
-
2.1
1.8
0.8
0.9
-
1.4
Medium-high technology manufactures
5.6
5.1
7.9
6.0
7.7
-
4.3
3.9
-
-
-
4.1
8.6
1
Medium-low technology manufactures
5.9
5.3
6.0
4.7
-
4.2
3.6
-
-
-
5.6
Low technology manufactures
8.9
7.8
7.7
6.0
7.5
6.6
7.6
6.7
5.2
5.1
9.4
8.8
High and medium-high technology manufactures
7.8
7.2
12.2
9.5
13.8
14.8
6.6
5.9
-
-
6.6
5.8
1. Intensity of the previous year. 2. 1998 instead of 1995. 3. EU includes the 15 EU Members before 1 May 2004 excluding Austria, Greece, Luxembourg, Portugal (for which no Anberd data are available). 4. OECD includes previous EU countries and Canada, Japan, and the United States.
Source: OECD, STAN Indicators 2004.
-
9.1
1 1 1 1 1
4.7
OECD Science, Technology and Industry Outlook 2004
226 Table 31. Share of value added in total gross value added, 1991-2001 (cont'd)
Italy
(ISIC Rev.3)
© OECD 2004
Statistical Annex
Table 32. Trade-to-GDP ratio for goods and services, 1991-20031 Average imports and exports, as a percentage of nominal GDP, and average annual growth rates (%)
Goods Trade-to-GDP ratio
Services Average growth 19912001
200103
Trade-to-GDP ratio
Goods and services Average growth
Trade-to-GDP ratio
1991
1995
2001
2003
Australia2
13.1
15.3
17.0
16.6
2.1
2.6
-2.4
4.0
4.6
4.5
4.3
0.8
1.3
-4.5
17.1
19.9
21.6
20.9
1.8
2.3
Austria
26.7
25.8
35.4
34.7
2.2
2.8
-1.0
12.1
11.4
17.0
16.3
2.5
3.4
-1.9
38.8
37.2
52.4
51.0
2.3
3.0
-1.3
Belgium
-
-
-
-
-
-
-
-
-
-
-
-
-
-
68.2
66.9
84.2
80.9
1.4
2.1
-2.0 -6.3
1991
1995
2001
2003
19912003
19912001
200103
1991
1995
2001
Average growth
19912003
2003
19912003
19912001
200103 -2.9
Canada
21.4
31.0
35.3
30.9
3.1
5.0
-6.7
4.3
5.1
5.9
5.5
2.0
3.1
-3.9
25.7
36.1
41.2
36.4
2.9
4.7
Czech Republic
41.3
44.0
61.0
58.4
2.9
3.9
-2.3
8.0
12.0
11.1
8.8
0.8
3.3
-11.3
49.3
56.0
72.1
67.2
2.6
3.8
-3.5
Denmark
26.6
26.4
29.4
28.3
0.5
1.0
-1.8
7.7
7.0
12.1
11.7
3.5
4.5
-1.5
34.3
33.4
41.4
40.0
1.3
1.9
-1.7
Finland
17.7
26.4
30.2
28.7
4.0
5.4
-2.6
4.7
6.4
5.5
5.3
0.9
1.6
-2.4
22.4
32.8
35.7
34.0
3.5
4.7
-2.6
France
18.0
18.1
22.5
20.8
1.2
2.2
-4.0
3.7
3.7
4.6
4.4
1.5
2.3
-2.5
21.7
21.8
27.1
25.2
1.2
2.2
-3.7
Germany
22.3
20.0
28.3
28.0
1.9
2.4
-0.5
4.1
4.1
5.9
5.9
3.0
3.6
0.1
26.4
24.2
34.2
34.0
2.1
2.6
-0.4
Greece
17.8
16.5
17.9
16.7
-0.5
0.1
-3.5
4.3
4.7
10.1
7.7
4.8
8.5
-13.9
22.1
21.3
28.0
24.4
0.8
2.4
-7.0 -6.9
Hungary
-
34.5
62.1
54.3
5.7
9.8
-6.7
-
10.1
11.4
9.7
-0.5
2.0
-7.9
41.8
44.6
73.5
64.1
3.6
5.6
Iceland
23.6
24.8
26.8
23.5
0.0
1.3
-6.6
8.9
9.7
14.2
13.5
3.5
4.7
-2.7
32.5
34.5
41.0
37.0
1.1
2.3
-5.2
Ireland
45.0
57.9
63.4
47.2
0.4
3.4
-14.7
10.4
12.9
27.6
28.7
8.4
9.7
2.1
55.4
70.8
90.9
75.9
2.6
5.0
-9.0
Italy
14.7
19.4
21.6
19.5
2.3
3.9
-5.2
3.9
5.6
6.1
5.7
3.2
4.5
-3.4
18.6
25.0
27.7
25.1
2.5
4.0
-4.8
Japan3
7.5
6.9
8.4
8.8
1.4
1.1
4.6
1.7
1.5
1.7
1.8
0.6
0.2
5.5
9.2
8.4
10.1
11.0
1.5
1.0
4.4
Korea
23.7
24.5
29.9
30.7
2.2
2.3
1.3
3.7
4.9
6.7
6.2
4.3
6.0
-4.4
27.4
29.4
36.7
36.9
2.5
2.9
0.3
Luxembourg
62.4
53.3
53.5
46.8
-2.4
-1.5
-6.7
40.3
49.6
90.9
81.3
5.8
8.1
-5.6
102.7
103.0
144.4
128.1
1.8
3.4
-6.0
Mexico2
14.7
25.7
26.3
25.5
5.0
5.8
-3.1
3.1
3.4
2.4
2.3
-2.7
-2.7
-3.4
17.8
29.1
28.6
27.8
4.0
4.7
-3.2
Netherlands
43.5
44.9
51.1
48.4
0.7
1.6
-3.7
9.2
9.5
11.5
11.8
1.9
2.2
0.4
52.7
54.5
62.6
59.0
0.9
1.7
-2.9
New Zealand2
20.8
21.3
25.4
23.4
1.1
2.0
-8.3
7.2
7.6
8.4
8.2
1.2
1.5
-2.2
27.9
28.9
33.7
31.5
1.1
1.9
-6.7 -3.7
Norway
-
-
-
-
-
-
-
-
-
-
-
-
-
-
36.0
34.9
37.2
34.5
-0.3
0.3
Poland3
19.8
19.5
24.5
26.3
2.6
2.1
7.1
3.1
3.1
5.0
5.0
4.3
4.8
-0.5
22.9
22.6
29.5
35.7
3.7
2.5
9.5
-
27.4
29.6
28.0
0.3
1.3
-5.7
-
5.9
6.1
5.9
0.1
0.6
-2.5
33.6
33.3
35.7
33.4
0.0
0.6
-3.2
-
45.4
66.2
68.6
4.3
4.9
1.8
-
11.6
11.3
10.2
-3.3
-2.8
-5.2
46.1
57.0
77.5
78.8
4.5
5.2
0.9
13.8
17.5
23.1
21.7
3.8
5.2
-3.0
4.2
5.2
7.7
7.1
4.4
6.0
-3.8
18.0
22.7
30.7
28.8
4.0
5.4
-3.2 -2.8
Portugal3 Slovak Republic Spain Sweden
20.8
29.1
32.1
30.5
3.2
4.3
-2.6
5.8
6.8
10.6
9.9
4.5
6.0
-3.3
26.6
35.9
42.7
40.4
3.5
4.7
Switzerland2
27.1
26.0
33.7
31.4
1.2
2.2
-4.0
6.5
6.8
9.3
9.3
3.1
3.5
1.1
33.6
32.9
43.0
40.6
1.6
2.5
-2.9
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15.2
22.1
32.5
29.0
5.4
7.6
-5.7
United Kingdom
18.6
22.2
21.2
19.2
0.3
1.3
-4.9
5.1
6.4
7.6
7.4
3.1
3.9
-1.1
23.7
28.5
28.7
26.6
1.0
1.9
-3.9
United States2
7.8
9.1
9.5
9.1
1.4
2.0
-4.3
2.5
2.6
2.7
2.6
0.5
0.7
-1.0
10.3
11.7
12.1
11.7
1.2
1.7
-3.6
Turkey
Total OECD
2, 4
13.4
14.7
16.8
16.5
1.9
2.3
-1.7
3.3
3.6
4.3
4.4
2.5
2.6
1.4
18.0
19.4
22.3
22.1
1.9
2.1
-0.9
EU-152, 4
19.4
21.3
25.7
24.7
1.6
2.7
-3.9
4.6
5.3
7.3
7.3
4.1
4.6
-0.4
26.3
28.8
35.5
34.3
1.9
2.8
-2.7
EU-252, 4
19.4
21.6
26.3
25.3
1.8
3.1
-4.7
4.6
5.3
7.3
7.3
4.2
4.6
-0.6
26.4
29.0
35.9
34.9
2.2
3.1
-2.4
1. Or nearest years available.
2. 2002 instead of 2003.
Source: OECD, National Accounts database, November 2004.
3. 2002 instead of 2003 for Goods and for Services.
4. Aggregates of countries for which data are available.
StatLink: http://dx.doi.org/10.1787/534761537201
227
© OECD 2004
Exports as a percentage of production
Australia
(ISIC Rev.3)
Total manufacturing
(15-37)
Austria
1992
1999
1992
2002
17
21
45
67
Belgium 1992
2002
46
115
Canada
Czech Rep.
1992
2000
1993
2001
42
53
33
53
84
76
10
25
-
2002
57
70
38
48
29
38
68
1
101
130
59
-
42
67
1
85
101
36
-
24
Germany
Greece
1992
2001
1995
2002
20
22
32
47
62
1
54
101
26
-
53
1
46
90
11
895
41
56
107
26
58
111
1
Office, accounting and computing machinery
(30)
99
116
1,044
208
-
2,804
2
117
120
180
114
1
206
406
69
310
62
102
1
46
117
156
Radio, television and communication equip.
(32)
16
25
32
90
-
110
2
40
69
72
73
1
95
185
62
58
39
66
1
51
108
20
38
Medical, precision and optical instruments
(33)
42
67
71
102
-
232
2
-
-
29
42
1
102
96
71
62
29
45
1
47
74
50
68
Aircraft and spacecraft
(353)
42
40
-
-
1
-
78
2
74
87
-
38
1
-
-
9
-
68
66
1
100
142
-
-
14
20
73
92
1
-
129
2
62
72
63
69
1
75
86
50
-
41
51
1
42
54
24
-
1
Medium-high technology manufactures
57
1992
31
-
2
2002
16
59
135
France
1992
(2423)
Pharmaceuticals
155
Finland
2002
1
High technology manufactures
2
Denmark 1992
Chemicals excluding pharmaceuticals
(24ex2423)
13
18
54
79
56
118
2
38
53
-
59
1
63
90
38
-
47
61
1
46
60
21
-
Machinery and equipment, nec
(29)
19
26
71
81
-
160
2
47
67
43
80
1
76
77
46
48
39
55
1
43
57
23
38
1
24
38
29
42
48
55
36
33 -
Electrical machinery and apparatus, nec
(31)
14
25
81
90
-
97
2
41
66
31
71
1
58
77
49
77
37
53
Motor vehicles, trailers and semi-trailers
(34)
11
17
96
123
-
141
2
81
81
56
66
1
113
156
137
165
40
44
Railroad equip. and transport equip. nec
(352+359)
5
5
32
68
1
-
89
2
32
34
-
60
1
118
165
9
-
39
36
1
42
38
-
1
2
1
22
31
23
-
15
21
22
18
26
39
18
31
15
23
22
11
21
23
40
44
-
66
33
35
31
46
1
43
41
34
41
21
24
Coke, refined petroleum prod. and nuclear fuel
(23)
17
26
6
13
34
55
21
25
12
23
1
42
28
30
38
14
15
Rubber and plastics prod.
(25)
5
7
68
66
46
102
27
40
31
58
1
54
58
34
38
26
31
Other non-metallic mineral prod.
(26)
3
4
26
28
30
52
18
28
48
50
1
32
28
18
26
16
19
Basic metals
(27)
47
46
56
65
47
90
2
60
53
32
44
1
54
67
47
58
42
45
1
36
47
37
35
21
42
2
15
24
34
48
1
35
34
22
19
12
14
1
15
22
12
16
-
38
2
15
51
-
90
1
54
60
44
75
24
49
1
46
66
-
-
1
Medium-low technology manufactures
Fabricated metal prod., except mach. & equip.
(28)
5
4
37
40
Building and repairing of ships and boats
(351)
19
49
58
394
1
1
14
16
29
48
39
83
29
38
24
34
1
48
59
32
41
20
26
20
27
18
18
Food prod., beverages and tobacco
(15-16)
19
22
8
27
30
56
14
21
14
13
1
51
59
5
10
20
23
13
18
15
13
Textiles, textile prod., leather and footwear
(17-19)
20
26
64
95
58
153
13
35
42
71
1
82
193
38
54
31
52
49
77
32
38
Wood and prod. of wood and cork
(20)
8
10
35
47
30
65
60
58
27
38
1
42
43
48
45
12
18
1
9
18
6
5
Pulp, paper, paper prod., printing & publishing
(21-22)
3
4
41
50
24
49
45
44
21
37
1
18
22
51
54
13
17
1
16
23
7
6
Manufacturing nec; recycling
(36-37)
9
12
32
60
70
186
25
51
37
53
1
61
59
23
26
19
26
1
25
37
6
8
Low technology manufactures
1. Intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
Source: OECD, STAN Indicators 2004.
© OECD 2004
StatLink: http://dx.doi.org/10.1787/442804674716
OECD Science, Technology and Industry Outlook 2004
228 Table 33. Export ratio by industry and technology level, 1992-2002
© OECD 2004
Table 33. Export ratio by industry and technology level, 1992-2002 (cont’d) Exports as a percentage of production
Hungary
(ISIC Rev.3)
Iceland
Ireland
Italy
Japan
Korea
Mexico
Netherlands
New Zealand
Norway
1992
2002
1992
2000
1992
1999
1992
2002
1992
2002
1994
2001
1992
2001
1992
2002
1992
1998
1992
2002
(15-37)
39
63
50
54
70
84
23
34
13
18
23
31
19
42
64
82
36
40
37
40
-
94
1
-
36
1
123
120
31
56
1
27
30
1
39
-
-
84
93
223
1
-
-
67
78
1
Pharmaceuticals
(2423)
-
48
1
-
15
1
248
168
15
50
1
4
6
1
4
6
8
15
61
101
1
-
-
64
62
1
Office, accounting and computing machinery
(30)
35
108
1
-
187
1
106
106
76
83
1
34
33
1
59
53
89
141
392
1,625
1
-
-
179
259
1
Radio, television and communication equip.
(32)
67
98
1
-
8
1
103
124
26
51
1
27
28
1
44
58
76
68
46
84
1
-
-
57
64
1
Medical, precision and optical instruments
(33)
24
91
1
-
49
1
95
92
32
55
1
43
86
33
20
-
-
-
-
1
-
-
55
54
1
Aircraft and spacecraft
(353)
229
5
1
-
47
1
-
-
48
70
1
13
31
1
96
-
-
140
-
76
1
-
-
55
237
1
-
77
1
-
22
1
77
99
33
50
1
20
25
1
24
-
34
69
82
95
1
-
-
-
-
-
69
1
-
4
1
79
101
22
37
1
14
21
1
27
36
21
31
76
90
1
-
-
-
-
96
96
42
59
19
29
28
45
42
94
82
74
-
-
40
47
1
Total manufacturing High technology manufactures
Medium-high technology manufactures Chemicals excluding pharmaceuticals
(24ex2423)
Machinery and equipment, nec
(29)
40
85
1
-
47
Electrical machinery and apparatus, nec
(31)
76
56
1
-
4
1
70
115
19
31
1
16
24
1
39
45
89
159
102
160
1
-
-
26
52
1
Motor vehicles, trailers and semi-trailers
(34)
78
94
1
-
42
1
60
87
39
53
1
23
26
1
16
31
26
55
99
122
1
-
-
96
82
1
Railroad equip. and transport equip. nec
(352+359)
36
77
1
-
0
1
2
8
35
50
1
74
95
1
8
-
-
61
-
130
1
-
-
11
23
1
1
1
1
16
-
12
20
56
60
1
-
-
-
-
8
17
8
1
76
78
-
-
-
-
18
26
17
30
76
79
-
-
30
34
1 1
28
36
1
-
54
61
46
17
24
6
8
Coke, refined petroleum prod. and nuclear fuel
(23)
15
22
1
-
-
-
-
14
17
2
1
Rubber and plastics prod.
(25)
32
45
1
4
9
72
53
23
32
15
21
Other non-metallic mineral prod.
(26)
27
30
1
1
1
31
26
17
21
5
8
4
7
8
15
31
20
6
4
13
13
Basic metals
(27)
53
53
1
94
98
1
94
94
22
30
1
6
11
16
19
16
20
94
105
76
85
75
75
10
12
26
21
-
-
51
20
Medium-low technology manufactures
1
Fabricated metal prod., except mach. & equip.
(28)
26
34
1
9
5
1
54
33
12
17
1
4
6
17
19
14
39
32
25
Building and repairing of ships and boats
(351)
29
50
1
-
99
1
63
9
11
56
1
54
53
1
49
-
-
9
-
34
1
21
23
6
16
50
53
-
-
18
21
4
4
2
5
52
58
51
52
16
20
1
37
42
1
59
59
51
43
19
28
3
3
Food prod., beverages and tobacco
(15-16)
25
24
1
72
73
50
41
9
16
1
1
Textiles, textile prod., leather and footwear
(17-19)
111
76
1
30
35
85
85
30
44
6
10
1
48
58
13
44
121
158
56
58
32
44
Wood and prod. of wood and cork
(20)
26
42
1
0
3
33
23
5
8
0
0
1
4
3
6
5
33
21
37
36
19
13
Low technology manufactures
Pulp, paper, paper prod., printing & publishing
(21-22)
10
21
1
1
2
52
44
9
14
2
2
1
6
12
7
11
31
31
16
18
21
22
Manufacturing nec; recycling
(36-37)
33
151
1
0
1
31
34
33
44
5
7
1
26
43
24
53
33
28
14
12
23
28
1. Intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
1
Source: OECD, STAN Indicators 2004.
Statistical Annex
229
Exports as a percentage of production
Poland
(ISIC Rev.3)
Total manufacturing
(15-37)
High technology manufactures Pharmaceuticals
(2423)
1994
2001
1
1
Portugal
Slovak Rep.
Spain
Sweden
Switzerland
UK
EU3
Unites States
OECD4
1992
1999
1997
1999
1992
2001
1992
2001
1997
2000
1992
2001
1992
2001
1992
1999
1992
1999
54
66
31
43
13
17
30
39
21
26
29
38
54
63
19
31
41
51
-
4
1
42
62
-
-
28
49
66
67
-
-
57
100
26
35
49
71
34
43
-
4
1
11
23
-
-
10
32
67
79
-
-
40
76
10
15
33
56
19
28 57
Office, accounting and computing machinery
(30)
0
1
1
175
128
78
461
52
50
97
136
-
-
69
101
47
58
65
104
48
Radio, television and communication equip.
(32)
5
5
1
52
75
77
140
33
66
65
55
40
52
52
123
24
37
45
74
31
40
Medical, precision and optical instruments
(33)
1
1
1
61
60
34
30
24
47
65
72
76
88
51
63
16
26
44
56
30
41
Aircraft and spacecraft
(353)
-
9
1
-
-
-
-
121
86
46
103
-
-
70
123
35
44
73
77
47
57
-
2
1
39
66
-
-
36
51
50
58
-
-
45
53
20
24
42
51
-
-
Medium-high technology manufactures Chemicals excluding pharmaceuticals
(24ex2423)
-
2
1
20
34
-
-
22
38
43
66
-
-
46
60
17
22
41
54
-
-
Machinery and equipment, nec
(29)
3
3
1
36
51
58
81
34
42
52
64
70
82
51
55
24
27
45
54
32
38
Electrical machinery and apparatus, nec
(31)
3
2
1
57
94
64
82
25
36
49
66
44
51
36
52
24
38
29
41
24
34
Motor vehicles, trailers and semi-trailers
(34)
3
3
1
57
85
112
103
49
67
54
50
104
126
45
48
18
19
47
52
33
35
Railroad equip. and transport equip. nec
(352+359)
-
5
1
28
27
-
-
15
45
18
23
-
-
17
20
11
11
33
38
33
32
-
1
1
19
24
-
-
17
21
39
44
-
-
21
24
7
8
22
25
-
-
Coke, refined petroleum prod. and nuclear fuel
(23)
1
1
1
24
18
34
45
24
20
48
49
-
-
24
29
5
5
18
20
-
-
Rubber and plastics prod.
(25)
1
1
1
14
33
67
75
18
29
45
56
48
53
21
22
8
11
26
32
18
21
Other non-metallic mineral prod.
(26)
0
0
1
18
19
47
45
11
18
17
26
21
27
16
17
6
7
16
20
11
13
Basic metals
(27)
1
1
1
17
47
62
54
27
29
52
61
94
174
33
44
10
13
35
39
19
22
Fabricated metal prod., except mach. & equip.
(28)
0
0
1
18
26
34
47
10
13
25
27
27
31
13
15
5
6
15
18
9
11
Building and repairing of ships and boats
(351)
-
2
1
29
10
-
-
47
26
71
57
-
-
15
15
10
9
31
39
33
34
0
0
1
29
31
39
45
9
19
28
39
-
-
16
17
6
7
20
25
12
15
(15-16)
0
0
1
9
12
14
13
7
16
6
15
12
13
14
15
6
6
15
19
9
11
Textiles, textile prod., leather and footwear
(17-19)
1
0
1
49
53
96
125
15
36
58
107
72
78
30
43
7
13
35
46
21
29
Wood and prod. of wood and cork
(20)
0
0
1
38
39
45
53
7
11
36
42
8
10
3
5
6
4
14
19
11
14
Medium-low technology manufactures
Low technology manufactures Food prod., beverages and tobacco
Pulp, paper, paper prod., printing & publishing
(21-22)
0
0
1
20
24
43
52
9
16
40
50
21
26
11
12
5
6
17
21
11
12
Manufacturing nec; recycling
(36-37)
0
0
1
19
21
45
53
10
21
34
41
88
95
26
24
12
15
26
32
14
19
1. Intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
Source: OECD, STAN Indicators 2004.
OECD Science, Technology and Industry Outlook 2004
230 Table 33. Export ratio by industry and technology level, 1992-2002 (cont’d)
© OECD 2004
© OECD 2004
Table 34. Import penetration by industry and technology level, 1992-2002 Imports as a percentage of domestic demand
Australia
(ISIC Rev.3)
Total manufacturing
(15-37)
Austria
Belgium
Canada
Czech Republic
Denmark
Finland
France
Germany
Greece
1992
1999
1992
2002
1995
2002
1992
2000
1993
2001
1992
2002
1992
2002
1992
2002
1992
2001
1995
2002
26
34
49
66
76
117
43
53
32
53
53
68
31
37
29
37
29
40
40
46 -
HTM
65
75
68
106
1
129
152
72
88
92
81
1
101
137
67
52
1
42
59
1
56
101
72
Pharmaceuticals
(2423)
36
49
65
109
1
91
145
2
32
53
-
86
1
73
103
58
74
1
19
47
1
36
84
58
-
Office, accounting and computing machinery
(30)
100
103
152
146
253
474
2
107
108
106
106
1
126
155
78
119
72
101
1
62
109
102
109
Radio, television and communication equipment
(32)
50
70
42
90
119
110
2
56
74
83
82
1
95
172
63
37
45
64
1
57
107
71
73
Medical, precision and optical instruments
(33)
75
85
79
102
151
169
2
-
-
66
62
1
103
94
75
54
33
48
1
38
65
91
95
Aircraft and spacecraft
(353)
71
76
-
-
86
78
2
73
83
-
71
1
-
-
50
84
1
55
49
1
100
156
-
-
38
48
1
29
39
71
-
44
57
1
36
53
65
-
41
56
1
26
37
70
75
1
High technology manufactures
MHTM
39
49
76
92
1
Chemicals excluding pharmaceuticals
(24ex2423)
32
40
66
84
1
Machinery and equipment, nec
(29)
51
63
71
77
Medium-high technology manufactures
102
135
2
66
73
66
67
1
77
88
54
56
1
109
125
2
42
59
-
69
1
76
93
50
54
1
100
161
2
69
79
55
81
1
68
72
45
39
Electrical machinery and apparatus, nec
(31)
39
54
76
88
64
97
2
65
82
33
68
1
62
71
49
74
30
48
Motor vehicles, trailers and semi-trailers
(34)
37
46
97
123
111
150
2
79
76
42
53
1
106
120
128
130
35
38
Railroad equip. and transport equip. nec
(352+359)
32
44
37
60
1
80
94
2
31
38
-
45
1
111
111
25
50
40
43
1
1
2
1
Medium-low technology manufactures Coke, refined petroleum prod. and nuclear fuel
MLTM
15
20
38
45
(23)
16
15
23
39
53
60
39
48
1
28
33
22
47
1
45
46
28
27
22
25
11
11
18
45
1
47
35
31
26
22
20
Rubber and plastics prod.
(25)
24
29
64
67
81
102
36
43
38
64
1
52
57
40
38
27
32
Other non-metallic mineral prod.
(26)
10
12
21
27
36
42
30
37
20
30
1
26
30
19
20
15
19
1
17
32
48
65
34
35
92
93
39
42
-
-
22
27
34
-
28
27
16
16
22
29
41
51
16
20
25
17
Basic metals
(27)
18
23
53
58
76
87
2
39
45
19
53
1
78
82
31
42
42
47
1
37
45
46
42
Fabricated metal prod., except mach.&equip.
(28)
11
13
35
39
34
43
2
27
33
21
37
1
31
35
21
16
12
15
1
12
15
33
35
Building and repairing of ships and boats
(351)
3
50
71
239
36
29
2
16
59
-
82
1
25
48
25
17
14
29
1
16
50
-
-
1
1
LTM
15
19
31
44
59
81
22
27
17
32
1
38
52
14
20
22
28
Food prod., beverages and tobacco
(15-16)
7
9
11
27
42
50
13
17
10
15
1
29
40
7
17
16
19
Textiles, textile prod., leather and footwear
(17-19)
35
48
71
96
91
180
41
54
25
69
1
85
169
59
73
39
61
Wood and prod. of wood and cork
(20)
13
12
20
24
55
62
17
16
10
22
1
50
54
8
9
16
23
1
Pulp, paper, paper prod., printing & publishing
(21-22)
15
16
33
36
45
51
23
23
27
41
1
28
31
9
10
17
21
Manufacturing nec; recycling
(36-37)
28
36
38
60
119
189
39
48
27
38
1
38
46
30
36
27
35
Low technology manufactures
1. For comparison: intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
Source: OECD, STAN Indicators 2004.
27
31
26
29
17
20
22
24
64
85
31
41
20
19
27
36
1
16
21
32
25
1
30
40
29
36
StatLink: http://dx.doi.org/10.1787/707487145841
Statistical Annex
231
Imports as a percentage of domestic demand
Hungary
(ISIC Rev.3)
Total manufacturing
(15-37)
High technology manufactures
Iceland
Ireland
Italy
Korea
Mexico
Netherlands
New Zealand
Norway
1992
2001
1992
2000
1992
1999
1992
2001
1994
2001
1992
2001
1992
2002
1992
1998
1992
2002
38
63
55
63
64
76
21
31
21
24
25
45
63
80
38
43
44
47
HTM
-
94
-
81
1
147
140
40
63
33
-
-
84
93
211
1
-
-
84
177
1
Pharmaceuticals
(2423)
-
55
-
62
1
-125
-139
20
49
7
11
17
23
62
101
1
-
-
70
84
1
Office, accounting and computing machinery
(30)
88
110
-
100
1
112
111
83
93
51
32
91
192
296
-
-
-
114
693
1
Radio, television and communication equipment
(32)
78
98
-
97
1
102
135
41
61
27
48
77
72
52
90
1
-
-
77
90
1
Medical, precision and optical instruments
(33)
47
94
-
80
1
91
87
43
61
63
43
-
-
-
-
1
-
-
75
-
1
Aircraft and spacecraft
(353)
200
32
-
66
1
184
152
46
74
99
-
-
205
-
82
1
-
-
80
79
1
MHTM
-
77
-
82
1
78
98
32
45
28
-
37
69
83
94
1
-
-
-
96
1
Chemicals excluding pharmaceuticals
(24ex2423)
-
80
-
64
1
69
104
36
48
33
35
32
52
70
85
1
-
-
-
95
1
Machinery and equipment, nec
(29)
54
91
-
82
98
98
23
38
48
45
72
96
85
72
-
-
64
76
1
Electrical machinery and apparatus, nec
(31)
69
51
-
82
1
77
116
16
27
32
54
87
192
102
148
1
-
-
50
128
1
90
98
52
62
6
6
10
45
99
114
1
-
-
99
110
1
11
13
25
41
10
-
-
56
-
123
1
-
-
37
123
1
1
Medium-high technology manufactures
Motor vehicles, trailers and semi-trailers
(34)
80
92
-
98
1
Railroad equip. and transport equip. nec
(352+359)
51
74
-
84
1
MLTM
25
46
-
60
1
71
63
16
20
15
-
24
37
52
53
-
-
-
53
1
Coke, refined petroleum prod. and nuclear fuel
(23)
11
19
-
-
1
121
121
18
16
17
14
18
11
47
63
-
-
-
61
1
Rubber and plastics prod.
(25)
36
59
49
53
76
66
16
22
8
12
42
60
80
80
-
-
60
81
1
Other non-metallic mineral prod.
(26)
21
36
21
20
36
34
7
9
6
11
7
13
39
27
20
21
25
33
1
96
97
36
44
20
21
27
40
94
104
69
80
70
68
60
50
5
7
10
10
32
54
34
26
19
18
42
29
-
-
37
19
Medium-low technology manufactures
Basic metals
(27)
48
65
89
94
1
Fabricated metal prod., except mach.&equip.
(28)
24
45
47
41
1 1
Building and repairing of ships and boats
(351)
21
55
-
99
65
62
11
34
22
-
-
42
-
14
1
LTM
27
37
37
42
37
32
14
21
13
18
12
18
46
47
-
-
24
27
Food prod., beverages and tobacco
(15-16)
9
13
24
33
23
24
15
20
9
12
7
8
34
40
11
15
10
14
Textiles, textile prod., leather and footwear
(17-19)
118
75
71
75
90
94
14
27
18
32
18
42
112
138
52
60
79
85
Wood and prod. of wood and cork
(20)
20
41
61
54
47
42
15
17
27
28
9
11
58
47
6
7
20
24
Low technology manufactures
Pulp, paper, paper prod., printing & publishing
(21-22)
25
36
30
30
45
24
11
16
11
14
21
31
33
31
20
23
21
22
Manufacturing nec; recycling
(36-37)
40
346
45
56
32
41
11
18
15
29
25
39
45
39
30
34
48
52
1. For comparison: intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
Source: OECD, STAN Indicators 2004.
1
OECD Science, Technology and Industry Outlook 2004
232 Table 34. Import penetration by industry and technology level, 1992-2002 (cont’d)
© OECD 2004
© OECD 2004
Table 34. Import penetration by industry and technology level, 1992-2002 (cont’d) Imports as a percentage of domestic demand
Poland
(ISIC Rev.3)
Total manufacturing
(15-37)
High technology manufactures
Portugal
Spain
Slovak Rep.
Sweden
Switzerland
United Kingdom
EU3
United States
OECD4
1992
2001
1992
1999
1992
2001
1997
1999
1992
2001
1997
2000
1992
2001
1992
2001
1992
1999
1992
1999
21
38
38
47
25
35
55
63
37
45
53
65
34
48
15
23
30
37
20
26
HTM
-
70
1
69
74
1
51
68
-
-
65
62
-
-
57
100
23
36
52
71
31
43
Pharmaceuticals
(2423)
-
65
1
36
53
1
19
46
-
-
48
57
-
-
29
72
8
19
28
48
17
27
Office, accounting and computing machinery
(30)
88
83
1
104
108
1
76
74
97
157
98
109
139
142
75
101
51
68
74
103
50
65
Radio, television and communication equipment
(32)
50
74
1
66
64
1
58
80
89
117
58
45
57
69
59
126
32
42
53
73
29
38
Medical, precision and optical instruments
(33)
50
49
1
89
87
1
58
71
59
64
64
70
49
71
50
64
12
23
44
55
27
38
Aircraft and spacecraft
(353)
-
93
1
-
-
1
114
90
-
-
50
103
-
-
60
124
14
30
69
74
36
49 -
MHTM
-
59
1
66
73
1
43
55
-
-
46
52
-
-
47
58
21
31
38
46
-
Chemicals excluding pharmaceuticals
(24ex2423)
-
55
1
47
59
1
37
47
-
-
55
73
-
-
43
58
11
20
41
51
-
-
Machinery and equipment, nec
(29)
44
63
1
70
69
1
52
56
71
87
45
54
50
68
49
56
19
26
36
44
24
31
Electrical machinery and apparatus, nec
(31)
28
56
1
60
80
1
33
41
70
83
54
66
35
43
39
53
27
47
25
38
21
34
Motor vehicles, trailers and semi-trailers
(34)
35
61
1
83
87
1
45
66
110
105
41
40
101
103
52
62
29
36
43
48
29
34
Railroad equip. and transport equip. nec
(352+359)
-
39
1
65
40
1
36
42
-
-
23
27
-
-
31
41
17
21
36
43
28
32 -
Medium-high technology manufactures
-
28
1
29
34
1
17
22
-
-
37
39
-
-
24
26
9
13
22
24
-
Coke, refined petroleum prod. and nuclear fuel
(23)
11
14
1
30
26
1
23
23
18
26
50
42
109
113
18
26
9
13
24
22
-
-
Rubber and plastics prod.
(25)
24
37
1
35
47
1
22
30
64
78
50
57
52
56
25
26
9
12
25
29
18
20 13
Medium-low technology manufactures
MLTM
Other non-metallic mineral prod.
(26)
11
19
1
10
13
1
8
10
31
33
27
30
34
40
18
19
9
14
14
15
10
Basic metals
(27)
16
43
1
63
76
1
27
36
39
35
42
53
95
155
43
50
14
22
39
43
20
24
Fabricated metal prod., except mach.&equip.
(28)
16
33
1
24
31
1
13
14
36
48
22
22
22
26
14
18
6
9
12
14
9
11
Building and repairing of ships and boats
(351)
-
19
1
17
10
1
18
26
-
-
69
24
-
-
13
8
2
6
17
20
12
15
LTM
11
21
1
22
27
1
14
21
36
44
23
30
-
-
25
30
11
16
22
26
15
19
(15-16)
8
9
1
16
22
1
10
17
22
23
14
25
18
19
19
22
5
6
16
19
11
13
Textiles, textile prod., leather and footwear
(17-19)
12
59
1
31
36
1
22
39
96
128
84
103
86
90
45
67
27
44
39
50
31
42
Wood and prod. of wood and cork
(20)
4
12
1
11
16
1
14
19
20
31
9
15
17
19
29
31
8
13
19
21
14
17
Low technology manufactures Food prod., beverages and tobacco
Pulp, paper, paper prod., printing & publishing
(21-22)
22
26
2
19
23
2
14
17
35
43
13
16
31
37
18
18
4
6
16
18
9
10
Manufacturing nec; recycling
(36-37)
17
29
1
30
29
1
18
22
39
51
39
41
91
96
37
39
27
39
26
31
19
26
1. For comparison: intensity of the previous year.
3. EU includes the 15 EU Members before 1 May 2004 excluding Belgium, Greece, Luxembourg, Netherlands.
2. 2000 instead of 2002.
4. OECD includes previous EU countries and Australia, Canada, Japan, Norway and the United States.
Source: OECD, STAN Indicators 2004.
Statistical Annex
233
OECD Science, Technology and Industry Outlook 2004
Table 35. Outward and inward foreign direct investment flows, 1990-2001 Billion USD
Outward flows 1990
1995
1998
Inward flows
1999
2000
2001
1990
1995
1998
Cumulative
1999
2000
2001
net outflow
Australia
2
2
5
2
1
6
6
5
6
7
7
6
Austria
2
1
3
3
6
3
-
-
-
3
9
6
- 39 10
Belgium-Luxembourg
6
12
28
133
218
86
8
11
23
149
226
77
- 38
Canada
5
11
34
16
48
35
8
9
23
24
67
27
10
Czech Republic
-
0
0
0
0
0
-
3
4
6
5
5
- 26 -4
Denmark
2
3
4
13
24
9
1
4
6
11
32
7
Finland
3
1
19
7
24
8
1
1
12
5
9
3
40
France
36
16
43
127
176
83
16
24
29
47
43
53
326
Germany1
24
39
89
110
50
43
2
14
25
55
195
32
171
Greece
-
-
-
-
-
1
2
-
-
-
-
2
-7
Hungary
-
-
-
0
1
0
-
-
-
2
2
2
-5
Iceland
0
0
0
0
0
0
0
0
0
0
0
0
0
Ireland
-
-
4
5
5
6
0
0
9
19
26
16
- 53
Italy
7
6
12
7
12
21
6
5
3
7
13
15
40
Japan
57
53
40
65
50
33
3
4
10
21
29
18
441
Korea
1
3
3
2
3
2
1
1
5
11
10
3
- 13
Mexico
-
-
-
-
-
-
3
10
12
12
15
24
- 132
Netherlands
13
19
39
41
72
40
9
11
38
32
54
51
92
New Zealand
2
2
0
1
1
1
2
3
2
1
1
3
- 19
Norway
1
3
3
6
8
2
1
2
4
8
6
3
3
Poland
-
0
0
0
0
0
0
4
6
7
9
6
- 46
Portugal
0
1
4
3
8
8
2
1
3
1
6
6
-3
Slovak Republic
-
-
-
-
0
0
-
-
-
-
2
1
-4
Spain
3
4
19
42
55
28
14
6
12
16
38
22
18
15
11
24
22
41
-
2
14
20
61
23
13
- 20
Switzerland
7
12
19
33
43
11
5
2
9
12
19
8
119
Turkey
-
-
-
1
1
0
1
1
1
1
1
3
- 11
Sweden
United Kingdom
18
44
122
201
254
39
30
20
71
88
117
53
372
United States
31
92
131
175
165
114
48
59
174
283
301
124
- 201
Total OECD2
236
335
645
1 015
1 263
580
171
214
506
888
1 267
590
1 020
EU-252
129
157
410
715
944
375
93
118
259
508
811
370
862
EU-152
129
157
410
715
943
375
93
111
249
493
793
355
943
1. The statistics cover unified Germany as from 1990. 2. Excluding missing countries for respective years.
Source: OECD, FDI database, May 2004.
StatLink: http://dx.doi.org/10.1787/771435384853
234
© OECD 2004
OECD PUBLICATIONS, 2, rue André-Pascal, 75775 PARIS CEDEX 16 PRINTED IN FRANCE (92 2004 11 1 P) ISBN 92-64-01689-9 – No. 53613 2004
