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Global Research and Development Expenditures: Fact Sheet

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Global Research and Development Expenditures: Fact Sheet

November 18, 2015June 16, 2017 (R44283)

Research and development (R&D) plays a central role in advanced economies in areas such as economic growth and job creation, industrial competitiveness, national security, energy, agriculture, transportation, public health and well-being, environmental protection, and expanding the frontiers of human knowledge understanding.1 Accordingly, companies, governments, universities, non-profitnonprofit organizations, and others around the world have made substantial investments in R&D. Since 2000, total global R&D expenditures have more than doubled.

The United States emerged as a global leader in science and technology in the second half of the 20th century. During this period, U.S. public and private investments in R&D grew rapidly and helped to propel the United States to a position of global economic leadership. By 1960, the United States accounted for approximately 69% of the world's R&D funding. By 20132015, however, the U.S. share of global R&D expenditures2 had fallen to about 29%. (See Figure 1.)3 The U.S. decline in share of global R&D resulted not from a reduction in U.S. R&D investments—in fact, U.S. public and private R&D grew robustly during this period—but rather from even greater increases in the investments of the governments and industries of other countries, which recognized the importance of R&D to their industrial innovation and competitiveness.

Figure 1. U.S. Share of Global R&D

Sources: 1960: CRS analysis of U.S. Department of Commerce, Office of Technology Policy, The Global Context for U.S. Technology Policy, Summer 1997; 20132015: CRS analysis of Organization for Economic Cooperation and Development (OECD) data, Main Science and Technology Indicators, OECD.Stat.

Notes: Rest of the World includes the members of the OECD (less the United States), Argentina, China, Romania, Russia, Singapore, South Africa, and Taiwan. R&D expenditures by others countries are not included but are likely to be small in relative terms. CRS has estimated R&D expenditures for fiveseven countries (Australia, Ireland, Singapore, South Africa, and SwitzerlandCanada, Ireland, New Zealand, Switzerland, Turkey, and Argentina) not reporting data for 20132015 based on recent growth rates.

In 20132015 (the most recent year for which comprehensive data are available), global R&D expenditures were $1.557750 trillion. The United States continued to fund more R&D than any other country. China, ranked second in 20132015, funded more R&D than the next twothree highest countries—Japan and Germany, Germany, and South Korea—combined. The ten10 largest R&D-funding countries of 20132015 accounted for $1.316480 trillion in R&D expenditures, about 84.6% of the global total. (See Table 1.)

Table 1. Countries with the Highest Expenditure on R&D, 2013

2015

(in billions of current PPP dollars)

Rank

Country

Amount

  

Rank

Country

Amount

1

United States

502
$457.0.9

 

6

France

60
$ 55.2.9

2

China

408
336.5.8

 

7

Russia

United Kingdom

46
40.7.3

3

Japan

170
160.2.1

 

8

United Kingdom

Russia

40
39.9.5

4

Germany

112
101.0.8

 

9

Taiwan

33
30.5.7

5

South Korea

74
68.9.2

 

10

Italy

30
26.5.1

Source: CRS analysis of Organization for Economic Development and Cooperation, OECD.Stat database, https://stats.oecd.org/Index.aspx?DataSetCode=MSTI_PUB.

Notes: PPP = Purchasing Power Parity. PPP is used to determine the relative value of different currencies and to adjust data from different countries to a common currency allowing direct comparisons among them.

In 2000, China accounted for nearly 5% of global R&D, joining the United States, Japan, and the countries of Western Europe as the largest funders of R&D. In 2009, China surpassed Japan to become the second largest funder of R&D, and by 2013 China accounted for approximately 22% of global R&D. CRS estimates that more than half of the decline in the U.S. share of global R&D from 2000 to 2013 (10.5%, from 39.8% in 2000 to 29.4% in 2013) was due to China's rapid growth in R&D expenditures during the period.

Figure 2 illustrates R&D expenditures between 2000 and 2013 for the tenFigure 2 illustrates R&D expenditures between 2000 and 2015 for the 10 countries with the highest R&D expenditures.

Figure 2. R&D Expenditures of Selected Countries, 2000-2013

2015

(in billions of current PPP dollars)

Source: CRS analysis of Organization for Economic Cooperation and Development, OECD.Stat database, https://stats.oecd.org/Index.aspx?DataSetCode=MSTI_PUB.

Notes: PPP = Purchasing Power Parity. PPP is used to determine the relative value of different currencies and to adjust data from different countries to a common currency allowing direct comparisons among them.

Trends in global R&D share between 2000 and 20132015 for the ten10 countries with the highest 20132015 R&D expenditures are illustrated in Figure 3. Among them, six saw declines in share of global R&D between 2000 and 2013 (—the United States, Japan, Germany, France, the United Kingdom, and Italy), —while four saw their shares grow (—China, South Korea, Russia, and Taiwan).

.

In 2000, China accounted for nearly 5% of global R&D, joining the United States, Japan, South Korea, and the countries of Western Europe as the largest funders of R&D. In 2009, China surpassed Japan to become the second largest funder of R&D. From 2000 to 2015, while China's share of global R&D rose from 4.9% to 23.4%, the U.S. share fell from 40.0% to 28.8% and Japan's share fell from 14.7% to 9.7%.

Figure 3. Share of Global R&D of Selected Countries, 2000-2013

2015

Source: CRS analysis of Organization for Economic Development and Cooperation, OECD.Stat database, https://stats.oecd.org/Index.aspx?DataSetCode=MSTI_PUB.

Notes: Global R&D includes the expenditures of the OECD countries, Argentina, China, Romania, Russia, Singapore, South Africa, and Taiwan. Share computed in PPP terms. PPP = Purchasing Power Parity. PPP is used to determine the relative value of different currencies and to adjust data from different countries to a common currency allowing direct comparisons among them.

Figure 4 illustrates the growth of R&D expenditures for the ten10 countries with the highest 20132015 R&D expenditures from their 2000 R&D expenditure levels through 20132015.

Figure 4. Growth in R&D Expenditures Since 2000 for Selected Countries, 2000-2013

2015

Source: CRS analysis of Organization for Economic Development and Cooperation, OECD.Stat database, https://stats.oecd.org/Index.aspx?DataSetCode=MSTI_PUB.

Author Contact Information

[author name scrubbed], Specialist in Science and Technology Policy ([email address scrubbed], [phone number scrubbed])

Footnotes

1.

Alternatively, some nations have taken non-R&D intensive paths to economic growth, for example by serving as low labor-cost locations for the manufacturing and service needs of other nations, by licensing or acquiring the intellectual property needed for production activities, and by extracting and refining natural resources (e.g., oil, gas, minerals).
2.

For purposes of this report, global R&D expenditures include those of the OECD countries, Argentina, China, Romania, Russia, Singapore, South Africa, and Taiwan. R&D expenditures by others countries are not included but are likely to be small in relative terms.
3.

20132015 is the latest year for which OECD R&D data is largely complete. It generally takes a year or two for national R&D data to be collected and reported, then harmonized and published by the OECD.