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Global R&D: Measuring Commitment to Innovation

Why is this important?

Innovation in the form of new goods, services, or processes builds on new knowledge and technologies, contributes to national competitiveness, and furthers social welfare. Investment in research and development, a major driver of innovation, is vital in knowledge-intensive economies. R&D expenditures indicate the priority given to advancing science and technology relative to other national goals.

Key observations:

Estimated R&D expenditures worldwide: 1996–2007


How much?

R&D expenditures worldwide are estimated to have exceeded $1 trillion in 2007, up from $525 billion a decade earlier.

R&D expenditures for the United States, EU-27, and Asia-8 economies: 1996–2007



The United States accounted for about one-third of the $1.1 trillion 2007 worldwide R&D total—more than the EU-27 and more than the eight Asian economies with the largest R&D expenditures.

The rapidly growing R&D expenditures of the Asia-8 economies (China, India, Japan, Malaysia, Singapore, South Korea, Taiwan, Thailand) surpassed those of the EU-27 in 2003.

R&D expenditures as share of economic output for selected countries: 1996–2007



R&D intensity measures how much of a country's economic activity (gross domestic product) its R&D investment represents.

Japan committed 3.4% of its GDP to R&D in 2007, more than most other large economies, but was surpassed by South Korea. In comparison, R&D intensity was lower in the United States and the EU-27.

Over the past decade, R&D intensity has grown in Asia and has remained steady in the United States and EU-27.

Average annual growth of R&D expenditures for United States, EU-27, and Asia-8 economies: 1996–2007



Growth of R&D expenditures in the United States and the EU-27 averaged 5%–6% annually over the period 1996–2007. Comparable R&D growth rates of the Asia-8 economies often exceeded 10%, and in China's case 20%.

Asian R&D growth reflects rising private spending by domestic and foreign firms as well as increased public R&D spending, designed to support strategic policies that aim to raise economic competitiveness through the development of knowledge-intensive economies.

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