EU R&D spending stalls, new OECD data say

Newly released OECD statistics show public R&D budgets stagnating, but R&D tax breaks mean corporate R&D spend is increasing


R&D spending in EU member states plateaued at 2 per cent of GDP in 2015, according to the latest OECD data, which show that public research spending also stagnated in 16 OECD countries for which 2016 data are available.

Despite a public spending boost in the US, declining research budgets in Japan and eight other countries paint a flat picture overall.

In 2015 there was a decline of 0.2 per cent in government R&D budgets across the 35 OECD countries, while companies increased their R&D spending, carrying out 68.8 per cent of all the OECD-area R&D that year.

Government-financed R&D, excluding the cost of tax incentives for corporate R&D, has shrunk by 2.4 per cent in real terms since 2010, slipping from 31 per cent of total OECD spending in 2010 to 27 per cent in 2014.

In 2016, 29 OECD countries and some emerging economies gave preferential tax treatment to corporate R&D spending. The share of tax relief in total government support in the OECD area rose from an average of 37 per cent in 2006 to 45 per cent in 2014, as 6.4 per cent of business R&D was directly funded by governments. France, Russia and Korea provided the most support for business R&D as a share of GDP, and the US, France and China provided the most tax support by volume.

R&D expenditure as % of GDP in the EU


Total R&D Expenditure in OECD countries, 1981-2015 ($ billions)

Source: OECD Main Science and Technology Indicators Database, Feb 2017

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Related subjects: OECD, R&D policy

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