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A Methodolgy for Disentangling Public Funded R&D (GBARD) by Industries

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A Methodolgy for Disentangling Public Funded R&D (GBARD) by Industries. Thessaloniki, SEM Conference. 2016. Matilde Mas, Eva Benages and Juan Fernández de Guevara

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A Methodolgy for Disentangling Public Funded R&D (GBARD) by Industries

  1. 1. This project has received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under grant agreement No. 612774 A Methodology for Disentangling Public Funded R&D (GBARD) by Industries Matilde Mas (University of Valencia and Ivie) Eva Benages (Ivie) Juan Fernández de Guevara (University of Valencia and Ivie) Thessaloniki, SEM Conference. 2016
  2. 2. 1. Introduction 2. Public transfers in R&D 3. Disaggregation of pubic funded R&D (GBARD) by industries 4. From GBARD to ICT GBARD by industries 5. Results 6. Main issues Introduction 2
  3. 3. • SPINTAN Project aims, among other goals, to build a database that comprises investment and capital stock of intangibles in the public sector. • The project complements previous projects (INTAN-Invest, COINVEST and INNODRIVE) which covered the market sector (8 industries): SPINTAN covers the non-market sector. • SPINTAN conceptual framework (Corrado, Haskel and Jona- Lasinio, 2015) clarifies: 1. Definition of the non-market sector 2. Assets boundaries in the context of intangibles in the non-market sector 3. Implications to the SNA of the inclusion of public intangibles 4. The return of non-market public capital 5. Function of the government related to SPINTAN 6. Which government expenditures have to be capitalized Introduction 3
  4. 4. • Which part of the government expenditures have to be capitalized? – This question is particularly important given the fact that public sector transfers (current and capital expenditures) are not included as government GFCF. • They are habitually considered expenditures of the industries that receive the transfer. – Need for measurement of the public transfer for the acquisition of intangible assets, particularly in the case of R&D. • The relevance of knowing the contribution of the public sector to R&D goes beyond of the SPINTAN project. – Target 2 of Europe 2020 strategy (EC) is aimed to reach 3% of the EU's GDP invested in R&D. • Action 55 of the Digital Agenda for Europe (DAE,first flagship initiative of E2020) aims for Member States to double their annual public spending on ICT R&D. – However, monitoring trends in the public funding of ICT R&D is not straightforward given the lack of readily data. Introduction 4
  5. 5. • The aim of this paper is to: 1. To develop a methodology for estimating GBARD by industry and 2. To disaggregate it into ICT and non-ICT GBARD within each industry. • Based on an homogenous industry classification (following NACE Rev. 2) • High level of industry disaggregation: 37 industries, of which 7 ICT industries (following OECD, 2007, ICT sector definition) • For the 2004-2013 period • For Member States and EU28 3. To analyse the results of applying the proposed methodology • GBAORD by industry and country • ICT GBAORD by industry and country • In the methodology developed, the approach of Stančik (2012) and Stančik and Rohman (2014) is the starting point, but modified to achieve the objectives of this paper. Introduction 5
  6. 6. • How to measure public transfers in R&D, i.e. the resources the government endow to R&D? • Frascati Manual (OECD, 2015): – Performance-based approach: aggregation of the amount each industry receive for their intramural R&D. • Recommended by OECD (2015) • Government-financed GERD (Gross Expenditure on R&D) • Disadvantages: 1. As it is based on surveys delays in the information are habitual 2. Performers are not necessarily able to link their gov. funding to policy objectives. – Funder-based approach. GBARD (Government budget allocations for R&D): aggregation of the sums committed by government to fund other industries R&D. • Useful to increase the timeliness of R&D statistics. • Released by socioeconomic objectives (NABS chapters). Public transfers in R&D 6
  7. 7. • None of the two approaches suffice the SPINTAN objectives: – SPINTAN needs to compute how the public funding of R&D is distributed by NACE industries, instead of the NABS chapters. • We develop a methodology that allows disentangling which part of the Eurostat GBARD can be attributed to various different NACE industries. • Additional step: estimate also which part of the public funding invested in each NACE industry is addressed to ICT assets. • In the methodology developed, Stančik (2012) and Stančik and Rohman ’s (2014) approach is the starting point. Public transfers in R&D 7
  8. 8. • GBARD: measure of the government expenditure on R&D based on budgetary information (Frascati Manual). • It is based on the funder rather than the performer. • It requires to identify all the budget items involving R&D and to measure or estimate their R&D content in terms of funding. • “Government” should cover central (or federal) and provincial (or state) government, when its contribution is significant (public enterprises excluded). • It covers government-financed R&D performed in government establishments but also government-financed R&D in the other national sectors as well as abroad (including international organisations). • These estimates are less accurate than performance-based data but, as they are derived from the budgets, they can be linked to policies through classification by “objectives” or “goals”. Public transfers in R&D 8
  9. 9. NABS* chapters 1Exploration and exploitation of the earth 2Environment 3Exploration and exploitation of space 4Transport, telecommunication and other infrastructures 5Energy 6Industrial production and technology 7Health 8Agriculture 9Education 10Culture, recreation, religion and mass media 11Political and social systems, structures and processes 12 General advancement of knowledge: R&D financed from General University Funds (GUF) 13General advancement of knowledge: R&D financed from other sources than GUF 14Defence • Available GBARD data from Eurostat: – EU28 and Member States – 2004-2014 for most Member States and 2006-2014 for the EU aggregates – Classified by socio-economic objective (SEO), using the NABS 2007 classification: Public transfers in R&D 9 * Nomenclature for the Analysis and Comparison of Scientific Programmes and Budgets.
  10. 10. • What we are looking for is a correspondence between NABS chapters and NACE industries, in order to break down GBARD by NACE industries. • For this reason, we need: • A correspondence between NABS and NACE classifications • Weights to distribute GBARD of each NABS chapter among NACE industries since each NABS is generally distributed in more than one industry. Disaggregation of Public Funded R&D (GBARD) 10 GBAORDbyNABS NABS 1 NABS 2 … … … NABS 14 GBAORDbyNACE NACE 01-03 NACE 05-09 NACE 10-12 … … …
  11. 11. • Stančik, J. (2012) (http://ftp.jrc.es/EURdoc/JRC69978.pdf) contribution to the PREDICT project (European Commission) proposed a NACE→NABS correspondence. • However, we have to take the other way around since we need a NABS → NACE. • However, we use their NACE-NABS correspondence as a starting point Disaggregation of Public Funded R&D (GBARD) 11 Aggregation of NACE NABS 1 NABS 2 … … … … … NABS 14 NACE 01-03 NACE 05-09 NACE 10-12 … … … … NACE 99 NACE classification NABS classification NACE 01-03 NACE 05-09 NACE 10-12 … … … … NACE 99 NABS 1 NABS2 … … … … … NABS 14 Disaggregation of NABS NACE classification NABS classification Stančík, J. (2012): What we need:
  12. 12. • In addition, there is a change of NACE classification in 2008. • Therefore, the NABS → NACE correspondence requires, in fact, two correspondences: • NABS 2007 → NACE Rev. 1.1 → NACE Rev. 2 (2004-2007) • NABS 2007 → NACE Rev. 2 (2008-2013) • Thus, all the steps of the estimation have to be applied twice, once for each NACE revision. Disaggregation of Public Funded R&D (GBARD) 12
  13. 13. Weights: • Since each NABS corresponds to more than one NACE, we need a proxy variable to estimate the distribution weights of each NABS among NACE (Rev. 1.1 and Rev. 2) industries. • We follow Stančík, J., & Rohman, I.K. (2014): Public ICT R&D funding in the European Union [Technical Report]. Seville: JRC-IPTS, European Commission. Forthcoming. • Proxy selected: total labour costs (salaries times hours worked) of employees with higher education (ISCED codes 5a, 5b and 6) • Assumption: the distribution of government R&D expenditures by industries is similar to the distribution of labour costs of the most qualified employees. Disaggregation of Public Funded R&D (GBARD) 13
  14. 14. • Statistical information: • GBARD by NABS from Eurostat • LFS (Labour Force Statistics): Hours worked by employees with higher education by 3 digits NACE industries. – Tailored request to Eurostat for the SPINTAN project. • SES (Structure of Earnings Survey): Wages of employees with higher education by 3 digits NACE industries 2006 (NACE Rev. 1.1) and 2010 (NACE Rev. 2). Data for the remaining years are extrapolated. – Tailored request to Eurostat for SPINTAN project. Disaggregation of Public Funded R&D (GBARD) 14
  15. 15. • Starting point: Stančik, J. (2012) and Stančík, J. & Rohman, I. K.(2014) correspondence between NABS and NACE. • We use this correspondence to break down GBARD by NABS into NACEs using labour costs as weights. NABS-NACE correspondence 15 NABS codes NACE codes Labour costs Weights NABS 1 NACE 011 100 15% NACE 122 200 31% NACE 221 250 38% NACE 325 100 15% - Total NACEs assigned to NABS 1 650 100% Table 1 Example: NABS 1 correspondence and estimation of weights NABS 1 NABS 2 … … … … … … NABS 13 NABS 14 NACE 011 … … NACE 122 … NACE 221 … NACE 325 … NACE 990 Labourcostsby NACE(higher education)
  16. 16. • However, there are some NACE codes that are assigned to more than one NABS. • We have to breakdown labour costs of the NACEs affected to calculate the weights. • In these cases, we use the weight of the GBARD in the NABS involved to assign the labour costs of each NACE code to the corresponding NABS chapters • For example, NACE Rev.2 code 512 (Freight air transport and space transport) is assigned to NABS 3 (Exploration and exploitation of space) and 4 (Transport, telecommunication and other infrastructures), but we don’t have information about how much of the labour costs of higher education employees in this industry should be assigned to each NABS. • Therefore, we take as weights to distribute NACE 512 sector labour costs among NABS the weight of GBARD figures of each NABS (differentiating by country and year). NABS-NACE correspondence 16 NACE codes Labour costs NABS codes GBARD Weights Labour costs by NABS NACE 512 1000 NABS 3 100 80% 800 NABS 4 25 20% 200 Labour costs of employees with higher education assigned to NABS 3 Labour costs of employees with higher education assigned to NABS 4 NABS 1 … NABS 3 NABS 4 … NABS 14 NACE 011 … NACE 512 … … NACE 990 ? Table 2
  17. 17. • Once the labour costs of employees with higher education at 3 digits NACE are assigned to each NABS, the weight of these costs are calculated by NACE within the same NABS • This weight will be used to estimate GBARD figures by industries. • The calculations are made for each country and year. • For each NACE industry k (in a given year and country): where j= NABS chapter, k= NACE industry and labour costs are hours worked times wages for employees with higher education. * See in Tables 1, 2 and 3 examples of how these weights are computed Public Funded R&D (GBARD) by industry 17 𝐺𝐵𝐴𝑂𝑅𝐷 𝑘 = 𝑗=1 14 𝐺𝐵𝐴𝑂𝑅𝐷 𝑗 ∗ 𝐿𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡𝑠𝑗,𝑘 𝑘∈𝑗 𝐿𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡𝑠𝑗,𝑘
  18. 18. Example of the estimation procedure 18 Table 3 Example: NABS 3 and 4 distribution by NACE industries and estimation of weights Assignment of labour costs (higher education) NACE codes Labour costs NABS codes GBARD Weights Labour costs by NABS NACE 512 1000 NABS 3 100 80% 800 NABS 4 25 20% 200 Table 2 Example: Distribution of NACE 512 between NABS 3 and 4 using GBARD weights NABS codes GBARD by NABS NACE codes Labour costs higher educ. Weights GBARD by NACE NABS 3 4,000 NACE 302 100 8% 333 NACE 511 200 17% 667 NACE 512 800 67% 2,667 NACE 611 100 8% 333 Total NACEs assigned to NABS 3 1200 100% 4,000 NABS 4 15,000 NACE 301 150 8% 1,125 NACE 421 600 30% 4,500 NACE 512 200 10% 1,500 NACE 711 300 15% 2,250 NACE 712 750 38% 5,625 Total NACEs assigned to NABS 3 2000 100% 15,000 Procedure for NACEs assigned to more than one NABS GBAORD NACE 512=2,667+1,500= 4,167 NABS 1 NABS 2 NABS 3 NABS4 NABS 5 … … … … … … … NABS 13 NABS 14 … NACE 301 NACE 302 NACE 421 … NACE 511 NACE 512 … NACE 611 … NACE 711 NACE 712 …
  19. 19. • As LFS and SES data are classified following different revisions of NACE classifications: • NACE Rev.1.1 for the period 2004-2007 • NACE Rev.2 for the period 2008-2013 • For this reason we apply the correspondence between NACE Rev.1.1 and NACE Rev.2 to convert GBARD by NACE Rev. 1.1. – Final NACE Classification: 37 2-digits NACE Rev.2 industries comprising 7 ICT sectors (OECD classification). –Data on GBAORD by NACE has been smoothed to take into account the effects on the dataset of the NACE revision in 2008. The procedure followed is the estimation of a linear regression with a trend and a step dummy for 2008-2013. Several adjustments: Correspondence between NACE Rev.1.1 and NACE Rev.2 19
  20. 20. • Final NACE Classification: 37 2-digits NACE Rev.2 industries, differentiating ICT sectors: Final NACE Rev.2 industry classification 20 Industry description NACE Rev. 2 code 1 Agriculture, forestry and fishing 01-03 2 Mining and quarrying 05-09 3 Manufacture of food products, beverages and tobacco products 10-12 4 Manufacture of textiles, apparel, leather and related products 13-15 5 Manufacture of wood and paper products, and printing 16-18 6 Manufacture of coke, and refined petroleum products 19 7 Manufacture of chemicals and chemical products 20 8 Manufacture of pharmaceuticals, medicinal chemical and botanical products 21 9 Manufacture of rubber and plastics products, and other non-metallic mineral products 22-23 10 Manufacture of basic metals and fabricated metal products, except mach. & eq. 24-25 11 Manufacture of computer, electronic and optical products (except ICT industries) 26(nonICT) 12 Manufacture of electronic components and boards ICT261 13 Manufacture of computers and peripheral equipment ICT262 14 Manufacture of communication equipment ICT263 15 Manufacture of consumer electronics ICT264 16 Manufacture of magnetic and optical media ICT268 17 Manufacture of electrical equipment 27 18 Manufacture of machinery and equipment n.e.c. 28 19 Manufacture of transport equipment 29-30 20 Other manufacturing, and repair and installation of machinery and equipment 31-33 21 Electricity, gas, steam and air-conditioning supply 35 22 Water supply, sewerage, waste management and remediation 36-39 23 Construction 41-43 24 Transportation and storage 49-53 25 Publishing, audiovisual and broadcasting activities (except ICT industries) 58-60(nonICT) 26 ICT Computer and related activities ICT5820+62+631+951 27 Telecommunications ICT61 28 Computer programming, consultancy and related activ.; Information service activ. (exc. ICT) 62-63(nonICT) 29 Legal and accounting, head offices, management consultancy, architectural and engineering activ; technical testing and analysis 69-71 30 Scientific research and development 72 31 Advertising and market research; other professional, scientific and technical activities; veterinary activities 73-75 32 Administrative and support service activities 77-82 33 Public administration and defence; compulsory social security 84 34 Education 85 35 Human health and social work 86-88 36 Arts, entertainment and recreation 90-93 37 Activities of membership organisations 94
  21. 21. 2nd Step: Once GBARD by NACE industries has been computed, we take a further step: we split GBARD of each industry and year into ICT and non-ICT “assets”. • We again follow Stančík, J., & Rohman, I.K. (2014): we apply the ICT share to total GBARD for each country, industry and year: where k= NACE industry and • In the definition of the ICT occupations we follow Stančik, J. (2012) and Stančík, J. & Rohman, I. K.(2014): ISCO-88 codes: 123, 213, 214, 231, 311, 312 and 313 ISCO-08 codes: 133, 215, 216, 235, 243, 251, 252, 351, 352 and 742. From GBARD to ICT GBORD 21 𝐼𝐶𝑇 𝐺𝐵𝐴𝑂𝑅𝐷 𝑘 = 𝐺𝐵𝐴𝑂𝑅𝐷 𝑘 ∗ 𝐼𝐶𝑇𝑠ℎ𝑎𝑟𝑒 𝑘 𝐼𝐶𝑇 𝑠ℎ𝑎𝑟𝑒 𝑘 = 𝐿𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡𝑠 𝑓𝑜𝑟 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒𝑠 𝑤𝑖𝑡ℎ ℎ𝑖𝑔ℎ𝑒𝑟 𝑒𝑑𝑢𝑐𝑎𝑡𝑖𝑜𝑛 𝒊𝒏 𝑰𝑪𝑻 𝒐𝒄𝒄𝒖𝒑𝒂𝒕𝒊𝒐𝒏𝒔 𝐿𝑎𝑏𝑜𝑢𝑟 𝑐𝑜𝑠𝑡𝑠 𝑓𝑜𝑟 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒𝑠 𝑤𝑖𝑡ℎ ℎ𝑖𝑔ℎ𝑒𝑟 𝑒𝑑𝑢𝑐𝑎𝑡𝑖𝑜𝑛
  22. 22. 1. GBARD (Eurostat data): 22 Results
  23. 23. Results 23 GBARD by Member State (2013). Millions of euros Source: Eurostat 25,354 13,986 10,860 8,324 5,310 4,602 3,556 2,621 2,547 2,538 1,997 1,579 1,438 1,005 773 711 601 316 300 292 266 190 158 126 102 59 32 22 0 5,000 10,000 15,000 20,000 25,000 30,000 Total EU-28 GBARD: 90,506 million euros
  24. 24. Results 24 GBARD distribution by Member State (2013). Percentage Source: Eurostat Germany 28.3% France 15.6% United Kingdom 12.1% Italy 9.3% Spain 5.9% Netherlands 5.1% Sweden 4.0% Austria 2.9% Denmark 2.8% Belgium 2.8% Finland 2.2% Portugal 1.8% Poland 1.6% Czech Republic 1.1% Ireland 0.9% Greece 0.8% Hungary 0.7% Croatia 0.4% Romania 0.3% Luxembourg 0.3% Slovakia 0.3% Slovenia 0.2% Estonia 0.2% Others 5.5%
  25. 25. Results 25 GBARD intensity (GBARD / GDP) by Member State (2013). Percentage Source: Eurostat 0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2%
  26. 26. Results 26 Distribution of GBARD by NABS chapters (2013). EU28. Percentage Source: Eurostat General advancement of knowledge: R&D financed from General University Funds (GUF) 34.7% General advancement of knowledge: R&D financed from other sources than GUF 17.9% Industrial production and technology 9.2% Health 8.8% Exploration and exploitation of space 5.2% Defence 4.6% Energy 4.1% Agriculture 3.3% Political and social systems, structures and processes 2.8% Transport, telecommunication and other infrastructures 2.7% Environment 2.6% Exploration and exploitation of the earth 2.0% Education 1.2% Culture, recreation, religion and mass media 1.1%
  27. 27. GBARD and ICT GBARD by NACE (our estimation): 27 Results
  28. 28. Results 28 GBARD by NACE Rev. 2 industries. EU28 (2006-2013). Millions of euros NACE Rev. 2 industries 2006 2007 2008 2009 2010 2011 2012 2013 1. Agriculture, forestry and fishing (01-03) 1,459 1,452 1,451 1,424 1,381 1,331 1,264 1,224 2. Mining and quarrying (05-09) 551 648 737 803 848 879 888 907 3. Manufacture of food products, beverages and tobacco products (10-12) 641 664 687 695 693 684 664 655 4. Manufacture of textiles, apparel, leather and related products (13-15) 128 142 154 162 167 170 169 170 5. Manufacture of wood and paper products, and printing (16-18) 309 329 349 360 364 365 358 357 6. Manufacture of coke, and refined petroleum products (19) 0 32 66 94 117 136 149 162 7. Manufacture of chemicals and chemical products (20) 1,206 1,173 1,147 1,104 1,052 997 932 890 8. Manufacture of pharmaceuticals, medicinal chemical and botanical products (21) 501 525 549 560 562 558 545 540 9. Manufacture of rubber and plastics products, and other non-metallic mineral products (22-23) 454 478 500 511 514 511 498 495 10. Manufacture of basic metals and fabricated metal products, except machinery and equipment (24-25) 1,071 1,034 1,004 960 909 856 796 756 11. Manufacture of computer, electronic and optical products (except ICT industries) (26, exc. 261-264 and 268) 342 350 359 360 356 349 337 331 12. Manufacture of electronic components and boards (261) 150 170 188 201 209 214 214 217 13. Manufacture of computers and peripheral equipment (262) 0 15 41 64 82 97 107 118 14. Manufacture of communication equipment (263) 158 163 168 169 168 166 160 158 15. Manufacture of consumer electronics (264) 30 34 37 39 40 41 40 41 16. Manufacture of magnetic and optical media (268) 0 0 0 1 3 5 6 7 17. Manufacture of electrical equipment (27) 335 364 392 410 419 423 418 420 18. Manufacture of machinery and equipment n.e.c. (28) 1,444 1,523 1,599 1,637 1,648 1,641 1,604 1,594 19. Manufacture of transport equipment (29-30) 1,381 1,277 1,188 1,088 987 892 795 724 20. Other manufacturing, and repair and installation of machinery and equipment (31-33) 657 643 633 612 586 559 525 503 21. Electricity, gas, steam and air-conditioning supply (35) 2,435 2,569 2,699 2,764 2,783 2,772 2,710 2,693 22. Water supply, sewerage, waste management and remediation (36-39) 1,447 1,422 1,405 1,364 1,310 1,252 1,179 1,134 23. Construction (41-43) 1,487 1,374 1,278 1,171 1,062 959 855 778 24. Transportation and storage (49-53) 1,827 1,738 1,666 1,572 1,469 1,368 1,257 1,180 25. Publishing, audiovisual and broadcasting activities (except ICT industries) (58- 60, exc. 582) 360 374 388 393 393 388 377 373 26. ICT computer and related activities (5820, 62, 631 and 951) 1,712 1,900 2,075 2,191 2,262 2,300 2,288 2,309 27. Telecommunications (61) 537 489 448 404 361 320 280 250 28. Information service activities (except ICT industries) (63, exc. 631) 105 99 94 89 82 76 70 65 29. Legal and accounting; management consultancy; ; technical testing and analysis and architectural and engineering activities (69-71) 8,185 8,275 8,387 8,332 8,173 7,958 7,624 7,446 30. Scientific research and development (72) 14,537 15,204 15,855 16,141 16,172 16,040 15,619 15,476 31. Advertising and market research; other professional, scientific and technical activities and Veterinary activities (73-75) 101 164 220 266 301 329 346 364 32. Administrative and support service activities (77-82) 0 0 0 0 2 247 448 624 33. Public administration and defence; compulsory social security (84) 9,328 9,109 8,947 8,641 8,261 7,857 7,367 7,054 34. Education (85) 22,329 25,186 27,826 29,650 30,827 31,527 31,504 31,910 35. Human health and social work (86-88) 5,167 5,965 6,699 7,225 7,582 7,812 7,854 7,995 36. Arts, entertainment and recreation (90-93) 237 264 288 304 314 320 318 321 37. Activities of membership organisations (94) 271 279 287 289 286 282 272 268 TOTAL 80,881 85,428 89,813 92,048 92,748 92,682 90,835 90,506
  29. 29. 29 GBARD by NACE Rev. 2 industries. EU28 (2006-2013). Percentage NACE Rev. 2 industries 2006 2007 2008 2009 2010 2011 2012 2013 1. Agriculture, forestry and fishing (01-03) 1.80 1.70 1.62 1.55 1.49 1.44 1.39 1.35 2. Mining and quarrying (05-09) 0.68 0.76 0.82 0.87 0.91 0.95 0.98 1.00 3. Manufacture of food products, beverages and tobacco products (10-12) 0.79 0.78 0.77 0.76 0.75 0.74 0.73 0.72 4. Manufacture of textiles, apparel, leather and related products (13-15) 0.16 0.17 0.17 0.18 0.18 0.18 0.19 0.19 5. Manufacture of wood and paper products, and printing (16-18) 0.38 0.39 0.39 0.39 0.39 0.39 0.39 0.39 6. Manufacture of coke, and refined petroleum products (19) 0.00 0.04 0.07 0.10 0.13 0.15 0.16 0.18 7. Manufacture of chemicals and chemical products (20) 1.49 1.37 1.28 1.20 1.13 1.08 1.03 0.98 8. Manufacture of pharmaceuticals, medicinal chemical and botanical products (21) 0.62 0.62 0.61 0.61 0.61 0.60 0.60 0.60 9. Manufacture of rubber and plastics products, and other non-metallic mineral products (22-23) 0.56 0.56 0.56 0.56 0.55 0.55 0.55 0.55 10. Manufacture of basic metals and fabricated metal products, except machinery and equipment (24-25) 1.32 1.21 1.12 1.04 0.98 0.92 0.88 0.84 11. Manufacture of computer, electronic and optical products (except ICT industries) (26, exc. 261-264 and 268) 0.42 0.41 0.40 0.39 0.38 0.38 0.37 0.37 12. Manufacture of electronic components and boards (261) 0.19 0.20 0.21 0.22 0.23 0.23 0.24 0.24 13. Manufacture of computers and peripheral equipment (262) 0.00 0.02 0.05 0.07 0.09 0.10 0.12 0.13 14. Manufacture of communication equipment (263) 0.20 0.19 0.19 0.18 0.18 0.18 0.18 0.17 15. Manufacture of consumer electronics (264) 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 16. Manufacture of magnetic and optical media (268) 0.00 0.00 0.00 0.00 0.00 0.00 0.01 0.01 17. Manufacture of electrical equipment (27) 0.41 0.43 0.44 0.44 0.45 0.46 0.46 0.46 18. Manufacture of machinery and equipment n.e.c. (28) 1.79 1.78 1.78 1.78 1.78 1.77 1.77 1.76 19. Manufacture of transport equipment (29-30) 1.71 1.49 1.32 1.18 1.06 0.96 0.88 0.80 20. Other manufacturing, and repair and installation of machinery and equipment (31-33) 0.81 0.75 0.70 0.67 0.63 0.60 0.58 0.56 21. Electricity, gas, steam and air-conditioning supply (35) 3.01 3.01 3.00 3.00 3.00 2.99 2.98 2.98 22. Water supply, sewerage, waste management and remediation (36-39) 1.79 1.66 1.56 1.48 1.41 1.35 1.30 1.25 23. Construction (41-43) 1.84 1.61 1.42 1.27 1.15 1.04 0.94 0.86 24. Transportation and storage (49-53) 2.26 2.03 1.86 1.71 1.58 1.48 1.38 1.30 25. Publishing, audiovisual and broadcasting activities (except ICT industries) (58-60, exc. 582) 0.44 0.44 0.43 0.43 0.42 0.42 0.42 0.41 26. ICT computer and related activities (5820, 62, 631 and 951) 2.12 2.22 2.31 2.38 2.44 2.48 2.52 2.55 27. Telecommunications (61) 0.66 0.57 0.50 0.44 0.39 0.35 0.31 0.28 28. Information service activities (except ICT industries) (63, exc. 631) 0.13 0.12 0.11 0.10 0.09 0.08 0.08 0.07 29. Legal and accounting; management consultancy; ; technical testing and analysis and architectural and engineering activities (69-71) 10.12 9.69 9.34 9.05 8.81 8.59 8.39 8.23 30. Scientific research and development (72) 17.97 17.80 17.65 17.54 17.44 17.31 17.19 17.10 31. Advertising and market research; other professional, scientific and technical activities and Veterinary activities (73-75) 0.13 0.19 0.24 0.29 0.33 0.35 0.38 0.40 32. Administrative and support service activities (77-82) 0.00 0.00 0.00 0.00 0.00 0.27 0.49 0.69 33. Public administration and defence; compulsory social security (84) 11.53 10.66 9.96 9.39 8.91 8.48 8.11 7.79 34. Education (85) 27.61 29.48 30.98 32.21 33.24 34.02 34.68 35.26 35. Human health and social work (86-88) 6.39 6.98 7.46 7.85 8.18 8.43 8.65 8.83 36. Arts, entertainment and recreation (90-93) 0.29 0.31 0.32 0.33 0.34 0.34 0.35 0.35 37. Activities of membership organisations (94) 0.33 0.33 0.32 0.31 0.31 0.30 0.30 0.30 TOTAL 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 77.2% GBARD in 2013 Results
  30. 30. 31 Education sector (NACE 85) share in GBARD. EU28 and Member States (2013). Percentage 93.3 59.0 54.9 54.7 51.5 50.2 47.0 46.2 44.1 43.3 40.7 40.6 39.8 35.3 30.1 27.8 27.8 25.1 25.0 21.0 20.9 17.0 16.6 16.5 6.9 6.5 3.4 2.6 1.4 0 10 20 30 40 50 60 70 80 90 100 Results
  31. 31. 32 Human health and social services sector (NACE 86-87) share in GBARD. EU28 and Member States (2013). Percentage 24.2 20.0 13.8 13.2 13.2 10.7 10.6 10.5 10.2 8.8 8.8 7.0 6.9 6.7 6.3 5.9 5.8 5.3 5.1 4.8 4.8 4.2 4.0 3.5 2.3 2.3 1.8 0.9 0.3 0 5 10 15 20 25 30 Results
  32. 32. 33 Scientific research and development sector (NACE 72) share in GBARD. EU28 and Member States (2013). Percentage 51.3 41.6 41.6 38.6 36.4 35.4 34.6 32.0 30.9 29.5 28.6 27.2 24.7 24.4 22.0 21.8 21.2 19.1 18.8 17.5 17.1 17.0 17.0 16.6 16.6 11.5 7.3 2.0 0.0 0 10 20 30 40 50 60 Results
  33. 33. 37 ICT GBARD by NACE Rev. 2 industries. EU28 (2006-2013). Percentage NACE Rev. 2 industries 2006 2007 2008 2009 2010 2011 2012 2013 1. Agriculture, forestry and fishing (01-03) 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.03 2. Mining and quarrying (05-09) 0.08 0.10 0.12 0.14 0.17 0.19 0.21 0.23 3. Manufacture of food products, beverages and tobacco products (10-12) 0.24 0.24 0.24 0.24 0.24 0.24 0.24 0.24 4. Manufacture of textiles, apparel, leather and related products (13-15) 0.01 0.02 0.03 0.04 0.05 0.05 0.06 0.07 5. Manufacture of wood and paper products, and printing (16-18) 0.23 0.23 0.22 0.22 0.21 0.21 0.20 0.20 6. Manufacture of coke, and refined petroleum products (19) 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07 7. Manufacture of chemicals and chemical products (20) 0.56 0.55 0.54 0.53 0.53 0.53 0.53 0.53 8. Manufacture of pharmaceuticals, medicinal chemical and botanical products (21) 0.35 0.35 0.35 0.34 0.34 0.34 0.33 0.33 9. Manufacture of rubber and plastics products, and other non-metallic mineral products (22-23) 0.11 0.11 0.11 0.11 0.12 0.12 0.12 0.12 10. Manufacture of basic metals and fabricated metal products, except machinery and equipment (24- 25) 0.50 0.45 0.41 0.37 0.34 0.31 0.29 0.27 11. Manufacture of computer, electronic and optical products (except ICT industries) (26, exc. 261-264 and 268) 0.78 0.82 0.86 0.91 0.95 0.99 1.03 1.07 12. Manufacture of electronic components and boards (261) 0.38 0.41 0.42 0.43 0.44 0.45 0.45 0.45 13. Manufacture of computers and peripheral equipment (262) 0.00 0.14 0.37 0.56 0.72 0.87 0.99 1.11 14. Manufacture of communication equipment (263) 0.73 0.80 0.87 0.94 1.01 1.07 1.14 1.20 15. Manufacture of consumer electronics (264) 0.10 0.10 0.10 0.10 0.10 0.10 0.09 0.09 16. Manufacture of magnetic and optical media (268) 0.00 0.00 0.00 0.00 0.01 0.01 0.02 0.02 17. Manufacture of electrical equipment (27) 0.36 0.37 0.37 0.37 0.38 0.38 0.38 0.38 18. Manufacture of machinery and equipment n.e.c. (28) 1.19 1.23 1.26 1.30 1.34 1.37 1.40 1.44 19. Manufacture of transport equipment (29-30) 1.86 1.67 1.51 1.38 1.27 1.17 1.09 1.02 20. Other manufacturing, and repair and installation of machinery and equipment (31-33) 0.36 0.41 0.47 0.51 0.55 0.59 0.63 0.67 21. Electricity, gas, steam and air-conditioning supply (35) 3.04 3.05 3.06 3.07 3.08 3.09 3.11 3.12 22. Water supply, sewerage, waste management and remediation (36-39) 0.74 0.60 0.47 0.37 0.27 0.19 0.12 0.05 23. Construction (41-43) 0.47 0.44 0.41 0.38 0.36 0.34 0.32 0.31 24. Transportation and storage (49-53) 2.62 2.10 1.67 1.32 1.03 0.77 0.56 0.37 25. Publishing, audiovisual and broadcasting activities (except ICT industries) (58-60, exc. 582) 0.36 0.43 0.50 0.56 0.63 0.69 0.76 0.82 26. ICT computer and related activities (5820, 62, 631 and 951) 29.75 31.14 32.21 33.06 33.76 34.30 34.75 35.15 27. Telecommunications (61) 2.99 2.66 2.39 2.16 1.96 1.79 1.64 1.51 28. Information service activities (except ICT industries) (63, exc. 631) 0.17 0.22 0.26 0.29 0.31 0.33 0.35 0.37 29. Legal and accounting; management consultancy; ; technical testing and analysis and architectural and engineering activities (69-71) 11.56 10.94 10.42 9.99 9.62 9.28 8.99 8.74 30. Scientific research and development (72) 22.68 22.46 22.27 22.12 22.00 21.87 21.77 21.70 31. Advertising and market research; other professional, scientific and technical activities and Veterinary activities (73-75) 0.02 0.02 0.02 0.02 0.02 0.01 0.01 0.01 32. Administrative and support service activities (77-82) 0.00 0.00 0.00 0.00 0.00 0.14 0.23 0.27 33. Public administration and defence; compulsory social security (84) 6.93 6.53 6.21 5.95 5.75 5.57 5.43 5.31 34. Education (85) 10.01 10.53 10.89 11.15 11.34 11.45 11.52 11.55 35. Human health and social work (86-88) 0.61 0.68 0.76 0.82 0.88 0.94 0.99 1.04 36. Arts, entertainment and recreation (90-93) 0.10 0.10 0.10 0.10 0.09 0.08 0.08 0.07 37. Activities of membership organisations (94) 0.07 0.07 0.07 0.07 0.08 0.08 0.08 0.09 TOTAL 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 Results
  34. 34. 39 0.1 0.1 0.2 0.5 0.9 1.0 1.1 1.3 1.3 1.5 1.5 1.5 1.7 1.8 1.8 1.8 2.3 2.5 2.6 3.2 3.8 3.8 4.9 4.9 5.6 5.9 5.9 8.8 9.2 9.4 13.5 14.2 23.7 25.3 32.0 39.5 63.9 0 10 20 30 40 50 60 70 31. Advertising, market research; other prof., scientific and technical activ. 1. Agriculture, forestry and fishing 22. Water supply, sewerage, waste manag. and remediation 35. Human health and social work 36. Arts, entertainment and recreation 9. Rubber and plastics products and other non-metallic mineral prod. 2. Mining and quarrying 24. Transportation and storage 37. Activities of membership organisations 10. Basic metals and fabricated metal products, except mach&eq. 34. Education 3. Food products, beverages and tobacco 23. Construction 6. Coke and refined petroleum products 4. Textiles, apparel, leather 32. Administrative and support service activities 5. Wood and paper products, and printing 7. Chemicals and chemical products 8. Pharmaceuticals, medicinal chemical and botanical prod. 33. Public administration 17. Electrical equipment 18. Mmachinery and equipment n.e.c. 21. Electricity, gas, steam and air-conditioning supply 29. Legal, account., management consultancy, architectural, engineering activ. 20. Other manufacturing, repair and installation of mach&eq. 30. Scientific research and development 19. Transport equipment 12. Electronic components and boards 25. Publishing, audiovisual and broadcasting (except ICT) 15. Consumer electronics 11. Computer, electronic and optical products (except ICT) 16. Magnetic and optical media 28. Information service activities (except ICT) 27. Telecommunications 14. Communication equipment 13. Computers and peripheral equipment 26. ICT computer and related activities ICT GBARD/Total GBARD by NACE industries. EU28 (2013). Percentage Results
  35. 35. 41 ICT GBARD/Total GBARD. EU28 and Member States (2013). Percentage 9.9 8.6 7.7 7.1 7.0 6.5 6.1 5.1 4.9 4.8 4.7 4.7 4.6 4.3 4.1 4.0 4.0 3.5 3.5 3.4 3.4 3.2 2.8 2.3 1.5 1.4 0.7 0.4 0.3 0 2 4 6 8 10 12 Results
  36. 36. • This paper proposes a methodology to estimate the R&D public sector transfers by NACE industries and which part correspond to ICT assets. • The methodology is based on GBARD data, which account for the sums committed by government to fund other industries R&D. • The methodology closely follows Stančík, J. (2012) and Stančík, J., & Rohman, I.K. (2014). • A correspondence between the NACE and NABS classification and the adequate weights to spilt different GBARD by NABS into NACE industries are used. • Two key assumptions: – the distribution of government R&D expenditures by industries is similar to the distribution of labour costs of the most qualified employees. – the percentage of ICT R&D assets in each industry is proportional to the share of labour costs of employees with higher education in ICT occupations over total labour costs with higher education. • The methodology is tested for the EU member states for the period 2006-2013. It offers a disaggregation of 37 2-digits NACE industries (comprising 7 ICT sectors). Main issues 43
  37. 37. • Results show that R&D transfers are concentrated in a small number of industries: – 5 industries concentrate 77% of total GBARD: • Education; Scientific Research and development; Health; Public Administration (including defense); and Legal, accounting, technical testing and analysis, architectural and engineering activities. • As expected, ICT GBARD intensive industries (in terms of the % of total GBARD) are the ICT sectors. Main issues 44
  38. 38. This project has received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under grant agreement No. 612774 A Methodology for Disentangling Public Funded R&D (GBARD) by Industries Matilde Mas (University of Valencia and Ivie) Eva Benages (Ivie) Juan Fernández de Guevara (University of Valencia and Ivie) Thessaloniki, SEM Conference. 2016

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