Top Countries by Research and Development Expenditure – 1996/2019

Expenditure on research and development (R&D) has always been a central element in understanding how individual countries are investing in the medium to long term. In fact, strong public and private sector spending in this area actually means investing in science and technology. It means increasing one’s own competitiveness with respect to the competition. In today’s article we will see the analysis of data on R&D spending from 1996 to 2018.

Top 20 Countries by Research and Development Expenditure – 2018

Let us start by first explaining what is meant by this parameter. Expenditure on research and development refers to gross expenditure in this sector in relation to the GDP of the individual countries (as a percentage). They include both capital and current expenditures in the four main sectors: Business enterprise, Government, Higher education and Private non-profit. R&D covers basic research, applied research, and experimental development.

Explained then that this parameter includes both public and private spending, what are the top 20 countries in the world for spending on research and development – 1996/2018?

The top country for this metric is Israel. In fact, this nation spends, in 2018, almost 5% of its GDP on research and development. A decidedly high figure, but one that is not far behind the second nation: South Korea. Even in Korea, in fact, spending is very high: 4.81. More distant are Switzerland with a value of 3.37%, Sweden with 3.34% and Japan with 3.26%. Overall, there are 8 countries with an expenditure of over 3%. This is followed by a group of 8 other countries with an expenditure of over 2%. This group also includes the United States of America, which ranks ninth. Finally, in fifteenth place we find Australia, which closes the top 20 – the first country in Oceania – with a value of 1.87%

Research and development expenditure in the world (% of GDP) – 1996/2018

Above we saw over time which were the top 20 nations in the world for R&D spending relative to GDP. But globally, what has been the trend over the past 20 years? Has spending increased or decreased?

Globally, as you can see in the chart above, the trend is positive. If in 1996 the figure for world spending on research and development was 1.97%, in 2018 the figure came in at 2.27%. The growth was therefore +0.30 points in relation to GDP. A figure that is certainly not small, given that each percentage point worldwide represents a large change. But in any case, despite an all in all positive trend, the figures are still far from the targets that the various governments have set themselves.

At European Union level, the target figure is in fact 3% of GDP spent in this sector. But, as you can see from the graphic below, for many countries we are still far from this goal. One example is Italy, which despite being one of the leading nations in the world for manufacturing production, is in 22nd place for investment in this sector.

The Italian case

We saw above how Italy, in 2018, is in 22nd position in the world for R&D spending. But what is the gap between Italy and the world average? And what between the world’s leading nation, Israel?

Although Italy has managed to increase its spending over the years, exceeding 1%, we are still far too far from the world average. The distance between Italy and the world over time has narrowed slightly, especially from 2007 onwards. But the gap is still very wide. In fact, we are talking about almost 0.9 points between Italy and the world. If we then compare, as can be seen in the graph, the data for Italy with Israel, it can be seen that for the latter nation growth in recent years has been very large. The gap between Israel and Italy, in fact, is over 3.5 points. A gap that was just over one and a half points in 1996.

Another important fact is that a large part of the research expenditure comes from the public sector: if the total expenditure is 100, 35% comes from the public sector and only 52.10% from companies. A data decidedly different from the European average where the public expense is of 30,9% and that private of the enterprises of 56,60%.

The nations in the world with the most researchers (per 1000 workers)

And at the level of researchers per 1,000 workers, which nations have the best data? Interestingly, as was easily predictable, in nations where the percentage spending on research is higher, the number of male and female workers in research is also higher. In this the OECD data does not show Israel’s data, but in general the top ranking of nations for research spending is similar to the top ranking of nations for researchers per 1000 workers. The U.S. in 2019 had a position, 13th, that was slightly distant from the position it had by research spending.

In 2019, South Korea is in first place with a value of 15,879 researchers per 1000 employees. This is followed by three northern European countries: Sweden, Finland and Denmark. All of these nations have values ranging between 15,000 and 14,000. Behind them by 1,400, but with a very high value, are Belgium and Norway. The European average for the 27 countries in 2020 is 8,879. Below the average are countries such as Greece, Spain, Italy, Mexico and others.

Source and link

I used several sources to make this article. The first one, for the video, was the World Bank. As for the data of researchers per 1000 workers, I used the OECD database. For the data on Italy the comments were made by reading the report provided by ISTAT.

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