Recent Reports: Japan’s R&D Funding Grows; U.S. Level Declines

According to a June 13 NSF Issues Brief, Japan is on track to achieve a doubling of its government R&D investment between the years 1992 and 2000. If it continues with funding increases such as those approved for 1996 and 1997, the NSF brief says, “annual government R&D investment would be around $18 billion in the year 2000, approximately double the 1992 budget in constant yen.”

A large portion of the added funding would go toward renovating facilities and instruments, particularly at universities. Funds would also be directed toward expanding doctoral programs at universities, increasing the amount of competitive grant money available, and attempting to create Centers of Excellence in specific research areas at Japanese universities. In recent years, Japan has also “provided additional funds to intensify international research cooperation in basic sciences” such as the Human Genome Project and construction of the Large Hadron Collider at CERN in Europe.

“Relative to the size of its economy, Japan’s overall R&D investment (both public and private) is about the same as that of the United States,” the paper states. In 1994, Japan spent 2.6 percent of its GDP on research and development compared to the U.S.'s 2.5 percent. However, most of the Japanese investment comes from private industry. The Japanese government supports less than 20 percent of total R&D, compared with support of 35-40 percent by the U.S. and Europe. If Japan achieves its doubling of federal research dollars by 2000, government support will equal approximately 29 percent of the R&D total.

The four-page NSF brief, “Japan Hopes to Double Its Government Spending on R&D,” (NSF-97-310), can be obtained under “Issue Briefs” on the NSF HomePage at: http://www.nsf.gov/sbe/srs/pubdata.htm ; or by sending an email request to pubs@nsf.gov or calling (703) 306-1773.

In contrast, a May GAO report on U.S. trends in federal investment shows a decline in government R&D funding in the past decade. According to GAO, the share of federal spending classified as investment (“specifically intended to enhance the private sector’s long-term productivity”) increased in constant dollars from the early 1980s through the mid-1990s, then began a gradual decline that is projected to continue through fiscal year 2002. Among various types of investment spending, federal R&D follows a similar trend, increasing in constant dollars through the 1980s, then declining in the 1990s. In constant 1992 dollars, the report shows, federal R&D spending rose from $48 billion in FY 1981 to $63 billion in FY 1990. It has since dropped to an FY 1996 level of $58 billion, and the Administration’s estimate for FY 2002 is about $50 billion. The report criticizes the current budget structure for not highlighting “for decision-making purposes the differences between spending for long-term investment and current consumption.”

The 19-page GAO report, “Budget Trends: Federal Investment Outlays, Fiscal Years 1981-2002,” (GAO/AIMD-97-88), is available on the Internet under the “Budget and Spending” heading for May GAO reports at http://www.gao.gov/monthly.list/may/may97.htm ; or by calling (202) 512-6000 or faxing a request to (301) 258-4066.