or, in other words, from the flexible and discretion- 

 ary way in which they may be used. This is particu- 

 larly important in an economy where activities and 

 requisite inputs are tautly planned for in advance, 

 as in much centralized funding. The GKNT, for exam- 

 ple, retains as a reserve a modest fraction (1.5 to 

 2 percent) of the annual budget allocation to science. 

 The State Committee can distribute these funds as 

 needs arise during the year for important scientific 

 research work not included in the approved plan. In 

 the period 1971 to 1975, for example, research insti- 

 tutes under the Ukrainian Academy of Sciences com- 

 pleted 354 additional projects for which the GKNT al- 

 located 37 million rubles from its reserve fund. 34 

 Industrial ministries and other major agencies may 

 also keep at their disposal up to 2 percent of their 

 budget allocations for science for special use. The 

 "active" role of such funds is bolstered by their 

 high priority, especially in the case of the GKNT 

 fund. They are able to command real resources at 

 short notice for use in urgent and unanticipated pro- 

 jects. 



Financing of R&D at the level of the performer or- 

 ganization, or decentrally financed R&D, is accounted 

 for either by contract with a sponsoring organization 

 or by revenue generated by the performer organiza- 

 tion's own economic activity. Research institutes 

 and design bureaus, of course, depend almost entirely 

 upon contract research for this financing, and the 

 importance of contract research in the total financ- 

 ing of their activities is naturally closely related 

 to the extent to which their work is directed at sat- 

 isfying the requirements of industry. In some minis- 

 tries, such as those machine-building ministries with 

 a pronounced "systems" or end product orientation 

 (e.g., motor vehicles, aircraft), certain R&D facili- 

 ties finance the majority of their work on the basis 

 of contracts. In institutes of the academies of sci- 

 ences contracting naturally is far less significant. 

 For the USSR Academy as a whole, by 1975 about 12 

 percent of the total work was financed by contract 

 receipts. In the Siberian Division and in the Ukrai- 

 nian Academy, which have more extensive ties with in- 



99 



