last 10 years, falling nearly one-fourth from its 

 peak level in 1964. The decline, as discussed 

 elsewhere in this report,* is due primarily to 

 reduced growth of expenditures by the Federal 

 Government for R&D in the defense and space 

 areas; increases in R&D funds from all other 

 sources combined kept pace with growth in the 

 GNP. In the case of France, the only other 

 country of those studied which showed a long- 

 term decline in this indicator, the reduction 

 appears to result largely from a slower growth in 

 government R&D expenditures for national 

 defense and nuclear energy. 



Both Japan and West Germany recorded 

 substantial growth in the proportion of the GNP 

 directed to R&D. Underlying their growth were 

 continuous large increases in R&D funding from 

 both industry and government. Total R&D 

 expenditures by Japan increased at an average 

 annual rate of 21 percent between 1963 and 

 1973, and those of West Germany by 15 percent, 

 as compared with 6 percent for the United 

 States. More recently, annual increases between 

 1969-73 averaged 24 percent for Japan, 16 

 percent for West Germany, and 4 percent for the 

 United States. While industry is the prime 

 source of R&D funds in Japan and West 

 Germany, funds provided by the government 

 have grown relatively more than those from 

 industry. Government funds for R&D in these 

 two countries are concentrated on advancement 

 of science and, to a lesser extent, on general 

 economic growth and nuclear energy. ^ 



For the U.S.S.R. this indicator is based upon 

 limited information and should be regarded only 

 as an estimate. The general upward trend in the 

 proportion of the GNP devoted to R&D is 

 believed to be valid, although the specific 

 numerical values may differ significantly from 

 the true values. Possible differences in the 

 variety of activities regarded as R&D, as well as 

 differences in GNP accounting, make inter- 

 national comparisons involving the U.S.S.R. 

 particularly hazardous. 



cost, and effectiveness of R&D — as well as 

 inconsistencies in GNP accounting — the 

 measure is relatively gross. Interpretations of 

 the indicator, therefore, should focus on general 

 trends rather than specific numerical values. 



The fraction of the GNP of the United States 

 devoted to R&D has declined steadily over the 



R&D Personnel 



The human resources involved in R&D 

 provide another comparison of the magnitude of 

 national R&D efforts. The number of scientists 



J See the chapter in this report entitled "Resources for 

 R&D". 



5 Information on the distribution of government R&D 

 expenditures among these and other areas is presented in a 

 later section of this chapter. 



