Researchers have found that investing public money in science and engineering research is good for the UK's economy.
Professor Jonathan Haskel from Imperial College Business School and his colleagues have found that public expenditure on science and engineering research is an investment that generates economic growth. This is because investment in scientific research leads to an increase in productivity in the private sector, which helps the economy to grow.
The report authors found that Government funding for science attracts substantial private sector investment, especially from overseas. They calculated that for every £1 spent by the Government on research and development (R&D), private sector R&D output rises by 20 pence a year. This puts the rate of return on public investment at around 20 per cent.
The report authors met with Universities and Science Minister David Willets recently to discuss the findings of the report and how it can help shape government policies.
The researchers suggest that the public expenditure on R&D plays an important role in connecting public and private research. This is vital as investment from both sectors generates economic growth.
They also suggest a one off increase by the Government in R&D spending could have major benefits for the UK economy. Currently, the UK Government allocates £4.6 billion per annum to science and research programmes. According to the report authors, if the government made a one-off increase in public spending on R&D of £450m, market sector output would rise by £90m per year, every year.
Professor Jonathan Haskel, report co-author and Chair in Economics at Imperial College Business School, said:
The country could benefit even more if the UK Government invests further in science through university and research funding because it further attracts private investment. This could help deliver strong economic returns and growth.
– Professor Jonathan Haskel
report co-author and Chair in Economics at Imperial College Business School
“The UK excels in research, development and innovation, and innovative companies are an important contributor to economic growth. The country could benefit even more if the UK Government invests further in science through university and research funding because it further attracts private investment. This could help deliver strong economic returns and growth.”
The report examines the relationship between public funding for science and engineering and three levels of economic activity. These levels of economic activity are productivity growth in industries, ability of universities to attract external income and interaction between individual researchers and the wider economy. It shows that in each case, public investment in science and engineering leads to economic growth.
Article text (excluding photos or graphics) © Imperial College London.
Photos and graphics subject to third party copyright used with permission or © Imperial College London.
Leave a comment
Your comment may be published, displaying your name as you provide it, unless you request otherwise. Your contact details will never be published.