The limited tools for measuring returns on government research spending

Abstract

Although industry's situation is more supportive than government's for the use of quantitative methods in research planning and budgeting(eg clearer economic objectives, more control of R and D implementation) we still found that US industrial R and D managers were sceptical of such methods: too simplistic, inaccurate, and prone to misinterpretation. We reviewed attempts to use econometric methods to measure returns on US Federal research funding in three areas (agriculture, aviation, health). Although a general link of research and economic growth is not questioned, the precise link is tortuously difficult to trace. For instance, results often describe the overall relationship—and not the impact of the marginal increment in funding which is of interest; the true value of the output is usually hard to measure; specific past relationships will not necessarily hold in future; etc. Non-econometric approaches were also reviewed. Analysis of publications, and similar bibliometric tools have been used to help identify health topics perhaps meriting more funding. The National Science Foundation, with other agencies, is active in collecting indicators of scientific activity. Good information and peer judgements remain the central tools, but aided by formal techniques. © 1986 Taylor & Francis Group, LLC.