OECD Highlights Importance of Public Sector Research, calls for Reforms

January 29, 2004

Paris, 28 Jan 2004

Urgent action is needed on the part of many OECD governments to make the public research sector more involved in innovative activities, more responsive to social needs and more attractive to young researchers, according to analysis by the OECD.

Challenges in the public research sector will be at the heart of discussions by OECD science and technology ministers at OECD headquarters in Paris on Thursday and Friday 29-30 January 2004. See: www.oecd.org/cstp2004min

Public outlays on research and development increased in real terms during the 1990s in OECD area, but declined as a share of economic output. Most of the increase was concentrated in the higher education sector. In the government sector, which encompasses national laboratories and other non-university research institutions, the picture is mixed, with declines in most countries during the 1990s but a rebound in the United States in the last few years due to increased investments in health and defence R&D.

Increased funding from the private sector compensated somewhat for stagnant public funding. About 6 % of R&D funding in the higher education sector came from business in 2001, compared to 3 % two decades earlier. Business also funded 5% of government R&D, double its share in 1981. These figures reflect in part the heightened relevance of long-term fundamental research carried out in the public sector for the innovative performance of industry.

Providing adequate funding for public research and sheltering it from cyclical variations should remain an important government objective. The expansion of the pool of knowledge is an investment for the future, involving risks that the private sector is not always likely to take, at least alone.

Not only does public research address important social problems, such as health, environment and security, but many of tomorrow's innovations will stem from fundamental research efforts of today, as present innovative businesses are built on discoveries that arose in the public research sector, such as the laser, Internet and DNA. Public financing is also necessary to support the research training of graduates in higher education and sends a signal to younger students that science and technology can offer a promising future.

As important as public funding is the way in which the public research sector is governed. Procedures for allocating research funds, setting research priorities and managing research institutions affect the type of research performed and the results achieved. Without proper governance, society cannot expect the economic and social benefits that it increasingly demands to see from government research investments.

In the last few years, OECD governments have taken a number of steps to improve the governance of public research. Countries have begun to involve business and civil society more closely in setting research priorities and to link research funds to identified priority areas. Governments are also granting public research institutions greater autonomy for developing curricula, managing human resources and negotiating research and licensing agreements with industry. Other efforts are being made to forge multi-disciplinary research centres that foster collaboration among researchers from different fields.

But more needs to be done to ensure the performance of public institutions over the long term. Funding for research must be matched by commensurate increases in funding for research equipment and infrastructure. Further improvements in human resource policies are also needed to encourage more flexibility in employment while at the same time providing long-term opportunities for young researchers.

For information about the meeting of OECD Science and Technology Ministers, journalists are invited to contact the Media Relations Division (tel. + 33 1 45 24 97 00 ). For public research issues, journalists are invited to contact Daniel Malkin , Head of the OECD Science and Technology Policy Division.

See table and graph.

Organisation for Economic Co-operation and Development
Item source: http://www.oecd.org /document/3/0,2340,en _2649_201185_25673475_119690_1_1_1,00.ht ml

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