Expenditure on research and development (R&D) is a
key indicator of government and private sector efforts to obtain competitive advantage
in science and technology.
Research and development (R&D) comprise creative
work undertaken on a systematic basis in order to increase the stock of knowledge
(including knowledge of man, culture and society) and the use of this knowledge to
devise new applications. R&D covers three activities: basic research, applied
research, and experimental development. Basic research is experimental or theoretical
work undertaken primarily to acquire new knowledge of the underlying foundation of
phenomena and observable facts, without any particular application or use in view.
Applied research is also original investigation undertaken in order to acquire new
knowledge; it is, however, directed primarily towards a specific practical aim or
objective. Experimental development is systematic work, drawing on existing knowledge
gained from research and/or practical experience, which is directed to producing new
materials, products or devices, to installing new processes, systems and services, or
to improving substantially those already produced or installed.
The main aggregate used for international comparisons is
gross domestic expenditure on R&D (GERD). This consists of the total expenditure
(current and capital) on R&D by all resident companies, research institutes,
university and government laboratories, etc. It excludes R&D expenditures financed
by domestic firms but performed abroad. GERD is here expressed as a share of GDP.
The R&D data shown here have been compiled according
to the guidelines of the OECD Frascati Manual.
Estimates of the resources allocated to R&D are affected by national
characteristics such as the periodicity and coverage of national R&D surveys
across institutional sectors and industries (and the inclusion of firms and
organisations of different sizes); and the use of different sampling and estimation
methods. R&D typically involves a few large performers, hence R&D surveys use
various techniques to maintain up-to-date registers of known performers, while
attempting to identify new or occasional performers.
Data for Israel exclude defence. Those for Korea, prior
to 2007, exclude social sciences and the humanities. Those for the United States,
exclude capital expenditure.
In 2008, research and development amounted to 2.3%
of GDP for the OECD as a whole. Denmark (since 2009), Finland, Israel, Japan,
Korea, Sweden and Switzerland were the only OECD countries in which the
R&D-to-GDP ratio exceeded 3%, well above the OECD average. Since 2000, R&D
expenditure relative to GDP has increased significantly in the EU and Japan and
only slightly in the United States. In China, R&D intensity increased from
0.9% in 2000 to 1.7% in 2009.
Since the mid-1990s, R&D expenditure in real
terms has been growing the fastest (among OECD countries) in Turkey and Portugal,
both with average annual growth rates above 10%. In China, growth in real R&D
spending since 2000 has exceeded 18% per year.