Climbing Mount Publishable

The growing role of knowledge in the global economy

Hugo Hollanders and Luc Soete

THE GLOBAL PICTURE

The UNESCO Science Report 2010 takes up from where its predecessor left off five years ago. The aim of this first chapter is to provide a global overview of developments over the past five years. We shall pay particular attention to ‘new’, ‘less known’, or ‘unexpected’ features revealed by the data and the chapters that follow.

We shall begin by briefly reviewing the state of the support system for science against the backdrop of the long, historically unique period of rapid global economic growth from 1996 to 2007. This ‘growth spurt’ has been driven by new digital technologies and by the emergence of a number of large countries on the world stage. It was brought to a sudden and somewhat brutal halt by the global economic recession triggered by the sub-prime mortgage crisis in the USA in the third quarter of 2008.

What impact has this global economic recession had on investment in knowledge? Before we endeavour to answer this question, let us take a closer look at some of the broad trends that have characterized the past decade.

First and foremost, cheap and easy access to new digital technologies such as broadband, Internet and mobile phones have accelerated the diffusion of best-practice technologies, revolutionized the internal and external organization of research and facilitated the implantation abroad of companies’ research and development (R&D) centres. However, it is not only the spread of digital information and communication technologies (ICTs) that has shifted the balance in favour of a more transparent and more level playing field. The growing membership and further development of global institutional frameworks like the World Trade Organization (WTO) governing international knowledge flows in trade, investment and intellectual property rights have also sped up access to critical knowledge. China, for example, only became a member of WTO in December 2001. The playing field now includes a wide variety of capital- and organization-embedded forms of technology transfer which include foreign direct investment (FDI), licenses and other forms of formal and informal knowledge diffusion.

Secondly, countries have been catching up rapidly in terms of both economic growth and investment in knowledge, as expressed by investment in tertiary education and R&D. This can be observed in the burgeoning number of graduates in science and engineering. India, for example, has opted to establish 30 new universities to raise student enrollment from less than 15 million in 2007 to 21 million by 2012. Large emerging developing countries such as Brazil, China, India, Mexico and South Africa are also spending more on R&D than before. This trend can also be observed in the transition economies of the Russian Federation (Russia) and some other Eastern and Central European countries which are gradually climbing back to the levels of investment under the Soviet Union. In some cases, the rise in gross domestic expenditure on R&D (GERD) has been a corollary of strong economic growth rather than the reflection of greater R&D intensity. In Brazil and India, for example, the GERD/GDP ratio has remained stable, whereas in China it has climbed by 50% since 2002 to 1.54% (2008). Similarly, if the GERD/GDP ratio has declined in some African countries, this is not symptomatic of a weaker commitment to R&D. It simply reflects an acceleration in economic growth thanks to oil extraction (in Angola, Equatorial Guinea, Nigeria, etc) and other non-R&D-intensive sectors. If each country has different priorities, the urge to catch up rapidly is irrepressible and has, in turn, driven economic growth worldwide to the highest level in recorded history.

Thirdly, the impact of the global recession on a post-2008 world is not yet reflected in the R&D data but it is evident that the recession has, for the first time, challenged the old North–South technology-based trade and growth models. Increasingly, the global economic recession appears to be challenging Western scientific and technological (S&T) dominance. Whereas Europe and the USA are struggling to free themselves from the grips of the recession, firms from emerging economies like Brazil, China, India and South Africa are witnessing sustained domestic growth and moving upstream in the value chain. Whereas these emerging economies once served as a repository for the outsourcing of manufacturing activities, they have now moved on to autonomous process technology development, product development, design and applied research. China, India and a few other Asian countries, together with some Arab Gulf states, have combined a national targeted technology policy with the aggressive – and successful – pursuit of better academic research within a short space of time. To this end, they have made astute use of both monetary and non-monetary incentives, as well as institutional reforms. Although data are not easy to come by, it is well-known that many academic leaders in American, Australian and European universities have, in the past five years, been offered positions and large research budgets in fast-growing universities in East Asian countries.

In short, achieving knowledge-intensive growth is no longer the sole prerogative of the highly developed nations of the Organisation for Economic Co-operation and Development (OECD). Nor is it the sole prerogative of national policymaking. Value creation depends increasingly on a better use of knowledge, whatever the level of development, whatever its form and whatever its origin: new product and process technologies developed domestically, or the re-use and novel combination of knowledge developed elsewhere. This applies to manufacturing, agriculture and services in both the public and private sectors. Yet, at the same time, there is striking evidence of the persistence – expansion even – in the uneven distribution of research and innovation at the global level. Here, we are no longer comparing countries but regions within countries. Investment in R&D appears to remain concentrated in a relatively small number of locations within a given country. In Brazil, for example, 40% of GERD is spent in the São Paulo region. The proportion is as high as 51% in South Africa’s Gauteng Province.

Climbing Mount Publishable

The old scientific powers are starting to lose their grip

The Economist Nov 11th 2010

TWENTY years ago North America, Europe and Japan produced almost all of the world’s science. They were the aristocrats of technical knowledge, presiding over a centuries-old regime. They spent the most, published the most and patented the most. And what they produced fed back into their industrial, military and medical complexes to push forward innovation, productivity, power, health and prosperity.

All good things, though, come to an end, and the reign of these scientific aristos is starting to look shaky. In 1990 they carried out more than 95% of the world’s research and development (R&D). By 2007 that figure was 76%.

Such, at least, is the conclusion of the latest report from the United Nations Educational, Scientific and Cultural Organisation, UNESCO. The picture the report paints is of a waning West and a rising East and South, mirroring the economic shifts going on in the wider world. The sans culottes of science are on the march.

GERD is good

Comparisons of the scientific prowess of countries frequently begin with spending. One measure of this is GERD, gross domestic expenditure on R&D. Globally, GERD amounted to $1.15 trillion in 2007 (the last year the UNESCO report measures). That was up 45% compared with 2002. Moreover, in those five years Asia’s share of the total rose from 27% to 32%.

When comparing economies of different sizes, the share of national wealth spent on R&D is also useful—particularly as scientific excellence tends to concentrate itself in small areas of the world, allowing researchers in tiny countries like Singapore to challenge those of larger ones, such as America. In 2007 Japan spent 3.4% of its GDP on R&D, America 2.7%, the European Union (EU) collectively 1.8% and China 1.4% (see chart 1). Many countries seeking to improve their global scientific standing want to increase these figures. China plans to push on to 2.5% and Barack Obama would like to nudge America up to 3%.

The number of researchers has also grown everywhere. China is on the verge of overtaking both America and the EU in the quantity of its scientists. Each had roughly 1.5m researchers out of a global total of 7.2m in 2007. Nevertheless, the number of scientists per million people remains relatively low in China. And India, second only to China in the size of its population, has only a tenth as many researchers. This is a surprising anomaly for a country that has become the world’s leading exporter of information-technology services and ranks third after America and Japan in terms of the volume of pharmaceuticals it produces.

Having lots of boffins does not matter, though, if they are not productive. One indicator of prowess is how much a country’s researchers publish. As an individual country, America still leads the world by some distance. Yet America’s share of world publications, at 28% in 2007, is slipping. In 2002 it was 31%. The EU’s collective share also fell, from 40% to 37%, whereas China’s has more than doubled to 10% and Brazil’s grew by 60%, from 1.7% of the world’s output to 2.7% (see chart 2).

The size of Asia’s population leads UNESCO to conclude that it will become the “dominant scientific continent in the coming years”. But citation of English-language articles in Chinese journals by other publications remains low. This could be because Chinese science is poor or because researchers in America, Europe and Japan have an historical bias towards citing each other. The average American paper was cited 14.3 times between 1998 and 2008, whereas the average Chinese paper was cited only 4.6 times, about the same as papers published in India and less than those published in South Korea.

For science’s aristos, then, much of this suggests the tumbrels await. But the story does not end there. What also counts is the extent to which countries are successful in using the knowledge they generate.

One way of looking at that is to count how many patents a country produces. This can be tricky. A recent report from Thomson Reuters, an information firm that is also the source of much of UNESCO’s data on scientific publications, suggests that between 2003 and 2009 Chinese patent filings grew by 26%—far faster than anywhere else. By this measure China will become the world’s largest registrar of patents in 2011. There is a snag, though. Bureaucrats in Chinese patent offices are paid more if they approve more. As a result there is a mountain of Chinese patents of dubious quality.

UNESCO’s latest attempt to look at patents has therefore focused on the offices of America, Europe and Japan, as these are deemed of “high quality”. In these patent offices, America dominated, with 41.8% of the world’s patents in 2006, a share that had fallen only slightly over the previous our years. Japan had 27.9%, the EU 26.4%, South Korea 2.2% and China 0.5%.

The prospects for R&D investment by business look bright in many of the emerging scientific nations, however. Between 2002 and 2007 business investment as a proportion of GDP has risen rapidly in China, India, Singapore and South Korea (although India’s increase was from a low base). But at least one aristo is fighting back, for investment has risen rapidly in Japan.

Although much of this might seem cause for the old regime to fret, there is one other pattern worth noting: that of growing international collaboration. Thanks to cheap travel and the rise of the internet, scientists find it easier than ever to work together. According to Sir Chris Llewellyn-Smith, the chairman of the advisory group for another report on global science (to be published early next year by the Royal Society, the world’s oldest scientific academy), more than 35% of articles in leading journals are now the product of international collaboration. That is up from 25% 15 years ago—something the old regime and the new alike can celebrate.

QUESTIONS FOR YOUR CONSIDERATION

1. What are the main current trends in global R&D?

2. Do you agree that quantitative increase in the global South’s output is matched by high quality of its results?

3. How can you explain the developments in East Asia?

4. What role do you see for Russia in the global knowledge economy?

Date: 2016-03-03; view: 1023