chapter 1 . 



national r&d patterns 



total r&d 

 expenditures 



Over the past 2 decades, Japan has 

 substantially increased its invest- 

 ments in R&D. Starting at a rela- 

 tively small base, R&D expenditures 

 in Japan increased nearly fivefold 

 between 1965 and 1985, growing 

 from constant (1982) $6.1 billion to 

 $36.0 billion — an average annual rate 

 of increase of 9.3 percent (chart 1). 

 During the same period, U.S. in- 

 vestments in R&D rose 63 percent, 

 from constant $59.4 billion to $96.5 

 billion, increasing at an average an- 

 nual rate of 2.5 percent. In constant 

 terms, U.S. R&D expenditures ex- 

 perienced virtually no net growth 

 between 1965 and 1975, while Jap- 

 anese expenditures during the pe- 

 riod more than doubled. U.S 

 expenditures increased from 1965 to 

 1968, but declined during most of 

 the 1968-75 period. By 1975, U.S. 

 R&D spending was just barely above 

 its 1965 total. Although U.S. 

 expenditures increased by 61 per- 

 cent from 1975 to 1985, this gain rep- 

 resents only slightly more than one- 

 half of the Japanese increase of 116 

 percent for the period. During 1980- 



86, U.S. R&D expenditures in- 

 creased 37 percent; Japanese R&D 

 expenditures increased 58 percent. 

 Although U.S. investments in R&D 

 are nearly three times as high as those 



of Japan in absolute terms, Japan's 

 investment is now comparable based 

 on the size of its economy. The Jap- 

 anese R&D to GNP ratio rose con- 

 sistently during the past 2 decades. 



Chart 1. National R&D expenditures 



[Constant 1982 dollars] 



Billions of dollars 

 100 



80 



United States 



\. 



100 



80 



- 40 



85 '86 



SOURCE; Nalitmal Science Foundation, SRS. table B-1 



