Background to the Research and Development Survey 2004
The Research and Development Survey 2004 (R&D Survey) was sponsored by the Ministry of Research, Science and Technology (MoRST). The R&D Survey measures the level of research and development activity, employment and expenditure by private sector enterprises, government departments, government-owned trading entities, and universities.
Following the previous R&D Survey in 2002, Statistics New Zealand and MoRST reviewed the methodology and evaluated the survey outputs. Consequently, a number of changes have been made to the R&D Survey 2004; firstly, in order to improve the estimation of R&D performed in the economy, and secondly, to collect more reliable and meaningful data through modifications to the survey questionnaire. For further details of these changes, please refer to the Technical Notes.
As a result of these modifications, caution needs to be taken when making comparisons between the data from the R&D Survey 2004 and data from previous R&D surveys.
The R&D Survey is carried out biennially by Statistics New Zealand. A more detailed R&D Survey 2004 research report will be published by Statistics New Zealand in July 2005.
Guide to interpreting the data
The following summary highlights the main points to consider when analysing the R&D Survey 2004 results. A full technical description is contained in the Technical Notes.
Definition of R&D
Statistics New Zealand uses the following definition of R&D which is based on international best practice: “Research and experimental development comprises creative work undertaken on a systematic basis in order to increase the stock of knowledge. Any activity classified as R&D is characterised by originality. Investigation is a primary objective.”
Data collection
The R&D Survey 2004 was conducted as a postal survey.The business, government and crown research institute (CRI) questionnaires were posted out in August 2004, as the questionnaire content refers to the last financial year. The university questionnaire was posted out in March 2005, as it collects information for the year ended December 2004.
The university questionnaire collects information that is generally produced for the purposes of annual reporting. This means that a number of data items for the universities’ R&D were produced using modelled information. The New Zealand Vice-Chancellors' Commission (NZVCC), and MoRST assisted Statistics New Zealand in the determination of these modelling specifications.
Nature of the survey
Given the nature of the data collected, there are limitations on the level of accuracy that can be expected from the R&D Survey. Many respondents do not keep separate account of their R&D expenditure, or they may include R&D with other scientific and technological services, such as consulting. Records may not be kept in the form required for the survey and estimation may be required. Detailed descriptions of what should and should not be included as R&D were provided on the questionnaire, and phone-in help was available to respondents.
R&D expenditure
Total R&D expenditure in the 2004 reference period was $1,601.3 million. This represents an increase of 13.1 percent from the 2002 reference period.
Survey results show that total R&D expenditure by the private sector was $648.1 million, government sector (excluding universities) expenditure was $498.4 million, and universities' expenditure was $454.8 million.
Private sector R&D expenditure in the 2004 reference period increased 24.5 percent from the 2002 reference period. Over the same period, government sector (excluding universities) and universities' expenditure increased 8.4 and 4.4 percent, respectively.
The reported increase of 24.5 percent for the private sector may have been impacted by changes in the sample design. When investigating 536 private sector enterprises that were common in both the R&D Survey 2002 and 2004, there was a 9.5 percent increase in expenditure on R&D.
R&D as a proportion of Gross Domestic Product
Total R&D expenditure recorded from the survey was 1.17 percent of New Zealand’s gross domestic product (GDP). When broken down into sectors, the private sector has been trending upwards over the last decade from 0.26 percent of GDP in the 1996 reference period to 0.47 in the 2004 survey period. Over the same period, government sector R&D expenditure as a proportion of GDP has declined slightly, but continues to be above the OECD average.
Even though New Zealand R&D has been increasing, it remains at a relatively low level compared with other countries in the OECD. Australia reported R&D expenditure as 1.62 percent of GDP in 2002, and the OECD average was 2.26 for the same period.
Type of research and development activity
There are three main types of research and development activity identified in this release.
Basic research is carried out to pursue a planned search for new knowledge with either a broad underpinning reference, or no reference to a likely application.
Applied research is investigation undertaken in order to acquire new knowledge. It is, however, directed primarily towards a specific practical aim or objective and determines possible uses of basic research.
Experimental development is systematic work, drawing on knowledge gained from research and practical experience, that is directed at producing new materials, products and devices; installing new processes, systems and services; or improving substantially those already produced or installed.
Of the total expenditure on R&D ($1601.3 million), $564.1 million was attributed to basic research, $595 million to applied research, and the remaining $442.2 million to experimental development.
In the private sector, the majority of research conducted was at the experimental development stage, with 56 percent in this category. A further 39.4 percent has been applied research in this sector.
The majority of government and university sector R&D has been in the basic research category, with 49.1 percent and 63.6 percent, respectively.
Source of funding for R&D expenditure
A total of 52.6 percent of government sector (excluding universities) expenditure on R&D in the 2004 reference period was funded by New Zealand Government funding agencies. This can be compared with private sector expenditure on R&D, where New Zealand Government funding agencies accounted for 7.6 percent of total R&D funding.
The largest source of funding for the private sector came from businesses’ own funds, which contributed 71.6 percent of the private sector R&D funding for the 2004 reference period.
The largest source of funding for the university sector came from internal R&D expenditure, which contributed 51.7 percent of university sector R&D funding for the 2004 reference period.
For technical information contact:
Nicholas Cox or Dan Martin
Wellington 04 931 4600
Email: info@stats.govt.nz