THE ECONOMIC BENEFITS OF PUBLICLY FUNDED BASIC RESEARCH: A CRITICAL REVIEW

  • Muneesh Kumar Department of Zoology, Govt. Degree College Bhaderwah, University of Jammu, Jammu, India
  • Sangeeta Devi Department of Botany, GGM Science College, Jammu, University of Jammu, Jammu, India
Keywords: Economic Benefits, Basic Research, Government Funding

Abstract

This article critically reviews the literature on the economic benefits of publicly funded basic
research. In that literature, three main methodological approaches have been adopted —
econometric studies, surveys and case studies. Econometric studies are subject to certain
methodological limitations but they suggest that the economic benefits are very substantial.
These studies have also highlighted the importance of spill over’s and the existence of
localisation effects in research. From the literature based on surveys and on case studies, it is
clear that the benefits from public investment in basic research can take a variety of forms. We
classify these into six main categories, reviewing the evidence on the nature and extent of each
type. The relative importance of these different forms of benefit apparently varies with
scientific field, technology and industrial sector. Consequently, no simple model of the
economic benefits from basic research is possible. We reconsider the rationale for government
funding of basic research, arguing that the traditional ‘market failure’ justification needs to
be extended to take account of these different forms of benefit from basic research. The article
concludes by identifying some of the policy implications that follow from this review.

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References

Allen Consulting Group (2004) Measuring the impact of publicly funded research, Department of Education, Science and Training, Canberra.

Alston, J.M. and Pardy, P.G. (2001) ‘Attribution and other problems in assessing the returns to agricultural R&D,’ Agricultural Economics 25, pp141-152. DOI: https://doi.org/10.1111/j.1574-0862.2001.tb00195.x

Hall, B.H., Mairesse, J. and Mohnen, P. (2010) Measuring the returns to R&D, in eds. Hall, B.H. and Rosenburg, N. (2010) Handbook of the Economics of Innovation. DOI: https://doi.org/10.3386/w15622

Harrison, M. (2007) ‘Valuing the future: Choosing the discount rate in cost-benefit analysis,’ OPBR Cost Benefit Analysis Conference, November 2007.

Jaffe, A. (1989) ‘Real effects of academic research,’ American Economic Review 79, pp957- 970.

Published
2017-12-31
How to Cite
Kumar, M., & Devi , S. (2017). THE ECONOMIC BENEFITS OF PUBLICLY FUNDED BASIC RESEARCH: A CRITICAL REVIEW. International Journal of Engineering Technologies and Management Research, 4(12), 71-73. https://doi.org/10.29121/ijetmr.v4.i12.2017.594