F.2. Sources of R&D Funding from Abroad Source for Further Reading

F. INTERNATIONALISATION OF SCIENCE AND TECHNOLOGY

F.2. Sources of R&D funding from abroad

■ Business research and development (R&D) is this case the European Union). Spain was the only financed by funds provided from within a country and country reporting almost 10% of finance originating from abroad. Foreign sources include other businesses, from other governments and foreign higher education public institutions (government agencies or institutions universities) or international organisations. According ■ to the Frascati Manual, foreign-funded R&D includes, for Again for the countries with available data, funding example, R&D performed by foreign affiliates when from other businesses comes largely from internal funded by the parent company (located abroad), but it corporate transfers (from the parent company to its excludes R&D that is funded domestically. affiliates abroad). This form of funding accounted for over 85% of the total in Denmark, the Slovak Republic ■ Foreign sources play a substantial role in the and Finland, and for over 50% in France, Austria and funding of business-sector R&D. Funds from abroad Norway. accounted for at least 15% of aggregate business R&D funding in 2007 in Austria, the United Kingdom, the Slovak Republic, Hungary, Canada and the Source Netherlands. In Turkey, Chile, Japan, Korea and Israel, • OECD (2009), OECD Science, Technology and Industry they accounted for less than 1% of the total. Scoreboard, OECD, Paris.

■ In most countries, the main providers of foreign For further reading funding are other businesses. Among the 16 countries • OECD (2002), Frascati Manual: Proposed Standard Practice for which data were available, Greece and Portugal for Surveys on Research and Experimental Development, were the only ones reporting over 50% of foreign OECD, Paris, www.oecd.org/sti/frascatimanual. funding supplied by international organisations (in

Measuring flows of R&D funds

R&D involves significant transfers of resources between units, organisations and sectors. In order to better measure and evaluate innovation policies and globalisation, it is important to trace the flow of R&D funds. According to the Frascati Manual, these transfers may be measured in two ways. One is performer-based reporting of the sums which one unit, organisation or sector has received or will receive from another unit, organisation or sector for the performance of intramural R&D during a specific period. The second is source-based reporting of extramural expenditures. These are the sums a unit, organisation or sector reports having paid or committed itself to pay to another unit, organisation or sector for the performance of R&D during a specific period. The first of these approaches is strongly recommended. For such a flow of funds to be correctly identified, two criteria must be fulfilled: • There must be a direct transfer of resources. • The transfer must be both intended and used for the performance of R&D. For further details on the identification of these criteria, see the Frascati Manual.

118 OECD ECONOMIC GLOBALISATION INDICATORS © OECD 2010 F. INTERNATIONALISATION OF SCIENCE AND TECHNOLOGY

F.2. Sources of R&D funding from abroad

Figure F.2.1. Funds from abroad, 2007 As a percentage of business enterprise R&D % 25

Italy China JapanKorea Iceland FinlandPoland Turkey HungaryCanada Norway Sweden (2006) Estonia Slovenia EU27 Spain New(2006) Zealand Chile (2004) Israel (2005) Austria (2006) IrelandFrance (2006)Greece (2006) (2005) Czech Republic Mexico (2005) UnitedSlovak Kingdom Republic Denmark (2005) Belgium (2006) Portugal (2005)Germany (2006) Australia (2006) NetherlandsSouth Africa(2003) (2005) Russian FederationSwitzerland (2004) Luxembourg (2005)

1 2 http://dx.doi.org/10.1787/842838411208 Figure F.2.2. Business enterprise R&D funded from abroad by source, 2007

% Business enterprises Government and higher education International organisations n.e.c. 100

Korea Finland Norway Sweden Italy (2006) Spain (2006) Austria (2006) France (2006) Turkey (2006) Greece (2005) Denmark (2005) Slovak Republic Belgium (2006)Czech Republic Slovenia (2006) Portugal (2005) Netherlands (2003)

1 2 http://dx.doi.org/10.1787/842855306071 Figure F.2.3. Funding from foreign enterprises, 2007 As a percentage of funds from abroad

% Enterprises within the same group Other business enterprises 100

Korea Finland Norway Sweden Italy (2006) Spain (2006) Austria (2006) France (2006) Denmark (2005) Slovak Republic Belgium (2006) Czech Republic Slovenia (2006) Portugal (2005) 1 2 http://dx.doi.org/10.1787/842856531164

Information on data for Israel: http://dx.doi.org/10.1787/888932315602.

OECD ECONOMIC GLOBALISATION INDICATORS © OECD 2010 119 From: Measuring Globalisation: OECD Economic Globalisation Indicators 2010

Access the complete publication at: https://doi.org/10.1787/9789264084360-en

Please cite this chapter as:

OECD (2010), “Sources of R&D funding from abroad”, in Measuring Globalisation: OECD Economic Globalisation Indicators 2010, OECD Publishing, Paris.

DOI: https://doi.org/10.1787/9789264084360-47-en

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