Today NPL economists, Dr Mike King and Eugenio Renedo release a new paper discussing the 2.4% GDP target. Highlighting that R&D investment is an important driver of the technological change which enables productivity growth, the paper looks at the current model of investment in R&D and what is required to further increase productivity. It is a timely and compelling thought piece during a moment when productivity benefits are vital to industry and economic recovery.
The paper highlights significant new evidence that the productivity of R&D needs to be improved and points to one study that suggest the rate at which R&D spending, and its conversion into better products, has declined over time. In order to achieve improved R&D outcomes and to ensure reproducibility, private organisations require good access to research tools, techniques, and standards. These infrastructure technologies (infra-technologies) need further investment to ensure they are accessible and relevant.
Investment in infra-technologies, such as metrology, increases the return on private R&D activity, through making one of its essential sub-activities - taking measurements during experiments - more reliable and productive. Reducing technological uncertainty further decreases risk and boosts the reproducibility of research findings, resulting in fewer hurdles, and allowing more of the potential projects to be funded by the private sector. These supportive technologies are crucial to UK industry in the months and years following the Covid-19 pandemic, to minimise economic scarring.
To read the full report and find out more about the role of measurement and National Metrology Institutes like NPL, click here
22 Jun 2020