ROBERT E. WILSON 



the cost of applied research and development carries a larger 

 amount of "hardware" than does basic research. 



Practically all the research directors contacted agreed that 

 their basic research had been expanding more rapidly than their 

 total research budgets during recent years, in spite of the fact 

 that inflationary factors affect applied research somewhat more 

 than they do basic. Comparing the 195s with the 1958 figures 

 would indicate that the expenditures for basic research of the 

 larger laboratories in the industry have been increasing at a rate 

 of about 21 per cent per year compared with 14 per cent annual 

 increase for the total cost of all research in the industrv. It must 



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again be emphasized that the 1958 figures were obtained from 

 the twelve largest research organizations in the industry, which 

 do about 69 per cent of the country's petroleum refining. These, 

 however, do the great bulk of the basic research that is carried 

 out in industry laboratories. Such a rate of increase is quite 

 gratifying, and would seem to indicate that the petroleum in- 

 dustry, at any rate, is making good strides in attaining reason- 

 able balance between basic and applied research. 



These figures would at first appear somewhat surprising in 

 view of Dr. Mervin J. Kelly's statement that total expenditures 

 for basic research have increased much less rapidly over the 

 longer period 1 940-1 958, possibly by a factor of three, than 

 the total expenditures for research. However, the figures are 

 not necessarily contradictory, because we must realize that the 

 period 1 940-1 958 was really made up of two periods of widely 

 different character, mainly because of the war. 



While accurate figures are not available bv years, there is 

 no question but that university research, which comprised well 

 over 50 per cent of basic work, was both curtailed bv a shortage 

 of manpower and, to a considerable extent, diverted to defense 

 problems during the war. At the same time, applied research, 

 mainly financed by the government, increased at an unprece- 



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