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Measuring R&D: Challenges Faced by Developing Countries

Executive Summary

Innovation is now universally regarded as an engine of economic growth in developing as well as developed countries ? it is therefore an important driver of poverty alleviation. To set effective innovation policies, policy-makers need trustworthy indicators to benchmark and monitor these policies. Research and experimental development (R&D) is an important component of a country’s national innovation system (NIS) and R&D statistics are among the most widely used indicators to monitor the NIS.

The methodology to measure R&D is detailed in the Frascati Manual (FM), which has been in use for almost fifty years. Despite this longevity, developing countries sometimes face problems when trying to apply the FM standards to the situation in their country. This Technical Paper provides guidance on a number of challenges that are relevant to developing countries and which may not be elaborated on clearly enough in the FM. The following situations that may present challenges to measuring R&D in developing countries are addressed in this document:

1) Developing countries are a heterogeneous group, extending from the least developed countries to emerging economies. Consequently, their innovation systems and associated R&D measurement systems exhibit wide variety both internally -- by institution, sector and region -- and internationally. In addition, despite the increasing presence of developing countries in global R&D, there is still a marked lack of demand for science, technology and innovation (STI) indicators from policy-makers in developing countries. Even if the demand does exists, there are often significant problems with compiling the data due to a lack of coordination at the national level, a lack of cooperation by research institutions, universities and businesses, and a generally weak statistical system in the country.

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