except the Department of the Interior (figure 3- 

 15). In the case of NASA, HEW, and Commerce, 

 the year of highest funding of intramural basic 

 research support was 1970, after which funding 

 decreased in each of the agencies. By 1974, 

 NASA's funding had declined more than 25 

 percent over its 1970 level, HEW by 40 percent, 

 and Commerce by almost 70 percent. Basic 

 research in DOD and USDA intramural 

 laboratories received the highest level of con- 

 stant dollar support in 1972. The DOD program 

 declined by just over 20 percent while the USDA 

 program remained fairly constant through 1974. 

 In contrast, the Department of the Interior 

 obligations for intramural basic research 

 reached their highest level in 1974. 



BASIC RESEARCH IN INDUSTRY'o 



Basic research consists of original in- 

 vestigations for the advancement of scientific 

 knowledge which has no specified commercial 

 objective, although the research may be within 

 the general area of a company's interest. Such 

 research, which is conducted largely by 

 manufacturing industries, may provide a 

 technical basis for product improvement, expan- 

 sion or new business, and a defense against 

 technological obsolescence. 



Expenditures for basic research in industry 

 represented 16 percent of the total national 

 funds spent for basic research in 1974, but only 3 

 percent of all R&D expenditures in industry.-^' 

 Although the current dollar total from all 

 sources has risen, particularly since 1972, the 

 effect of inflation has been to reduce the 1974 

 basic research expenditures in industry to 

 approximately the same level as 1961 (figure 3- 

 16). Federal support has dropped 12 percent 

 since 1971 in constant dollars compared to a 3 

 percent increase of non-Federal basic research 

 expenditures. The proportion of basic research 

 in industry which has had Federal support has 

 been about 22 percent for the last three years, 

 compared to 32 percent in 1967. 



Over three-fourths (78 percent) of the 1973 

 basic research expenditures in industry were 

 accounted for by only four industries (figure 3- 

 17): chemicals and allied products (37 percent), 

 electronic equipment and communications (28 



50 A more comprehensive discussion of R&D in industry is 

 found in a later chapter entitled, "Industrial R&D and 

 Innovation." 



31 Naiioml Pallenii of R&D Resources. 1953-75. National 

 Science Foundation (NSF 75-307). 



percent), aircraft and missiles (9 percent), and 

 machinery (4 percent). 



For the most part, basic research in industry is 

 concentrated in the physical sciences and 

 engineering (some 80 percent in 1973). Expen- 

 ditures in the physical sciences, however, have 

 declined significantly since the late 1960's, in 

 both current and constant dollars (figure 3-18), 

 while engineering expenditures reached their 

 highest level in 1973 in current dollars. Constant 

 dollar expenditures in the life sciences, on the 

 other hand, grew substantially in the late 1960's 

 before peaking in 1971 and then declining. 



BASIC RESEARCH IN 

 NONPROFIT INSTITUTIONS 



Independent nonprofit institutions are 

 organizations other than educational in- 

 stitutions chartered to serve the public interest, 

 and include research institutes, hospitals, 

 private foundations, science exhibitors, 

 professional societies, trade associations, and 

 FFRDC's administered by such nonprofit in- 

 stitutions. Although the largest single category 

 is the research institutes, the others generally 

 perform other services in addition to research, 

 such as patient care or charitable activities. 



These institutions were responsible for 7 

 percent of the Nation's expenditures for basic 

 research in 1974, a fraction which changed little 

 during the 1960-74 period. Current dollar 

 expenditures for basic research in nonprofit 

 institutions reached their maximum in 1974 

 (figure 3-19). In terms of constant dollar 

 expenditures, funds for basic research in 1974 

 were comparable in magnitude to the funding 

 level of earlier years (1971 and 1962-63), and 

 approximately 20 percent lower than the year of 

 highest funding which was 1966. 



Federal sources provide the greatest part of 

 support for basic research in these institutions 

 and have a large impact on the total level of 

 funding in any given year. In 1974, Federal 

 support accounted for 53 percent of all basic 

 research expenditures in nonprofit institutions, 

 compared to 58 percent in 1966 and 50 percent in 

 1960. In contrast to the fluctuating Federal 

 funding, support from other sources rose 

 comparatively steadily, although slowly. 



Over the 1960-74 period, basic research as a 

 proportion of total research and development 

 expenditures by these institutions declined from 

 38 percent to 22 percent. 



70 



