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//upload.wikimedia.org/wikipedia/en/thumb/f/f2/Edit-clear.svg/80px-Edit-clear.svg.png 2x" data-file-width="48" data-file-height="48" /></span></span></div></td><td class="mbox-text"><div class="mbox-text-span">This article may <b>require <a href="/wiki/Wikipedia:Cleanup" title="Wikipedia:Cleanup">cleanup</a></b> to meet Wikipedia's <a href="/wiki/Wikipedia:Manual_of_Style" title="Wikipedia:Manual of Style">quality standards</a>. The specific problem is: <b>subject coverage is superficial and relatively nescient, and is generally dated (despite impression of recentism imparted by web sources).</b><span class="hide-when-compact"> Please help <a href="/wiki/Special:EditPage/R%26D_intensity" title="Special:EditPage/R&D intensity">improve this article</a> if you can.</span> <span class="date-container"><i>(<span class="date">October 2015</span>)</i></span><span class="hide-when-compact"><i> (<small><a href="/wiki/Help:Maintenance_template_removal" title="Help:Maintenance template removal">Learn how and when to remove this message</a></small>)</i></span></div></td></tr></tbody></table> <figure class="mw-default-size" typeof="mw:File/Thumb"><a href="/wiki/File:1953-_Funding_for_research_and_development_-_US.svg" class="mw-file-description"><img src="//upload.wikimedia.org/wikipedia/commons/thumb/f/fc/1953-_Funding_for_research_and_development_-_US.svg/220px-1953-_Funding_for_research_and_development_-_US.svg.png" decoding="async" width="220" height="165" class="mw-file-element" srcset="//upload.wikimedia.org/wikipedia/commons/thumb/f/fc/1953-_Funding_for_research_and_development_-_US.svg/330px-1953-_Funding_for_research_and_development_-_US.svg.png 1.5x, //upload.wikimedia.org/wikipedia/commons/thumb/f/fc/1953-_Funding_for_research_and_development_-_US.svg/440px-1953-_Funding_for_research_and_development_-_US.svg.png 2x" data-file-width="1000" data-file-height="750" /></a><figcaption>Since the 1960s, private businesses in the U.S. have provided an increasing share of funding for research and development, as direct federal funding waned.<sup id="cite_ref-NSF_R&D_2023_1-0" class="reference"><a href="#cite_note-NSF_R&D_2023-1"><span class="cite-bracket">[</span>1<span class="cite-bracket">]</span></a></sup></figcaption></figure> <p><b>Research and development intensity</b> (<b>R&D intensity</b>) is generally defined as expenditures by a firm on its research and development (<a href="/wiki/R%26D" class="mw-redirect" title="R&D">R&D</a>) divided by the firm's sales.<sup id="cite_ref-2" class="reference"><a href="#cite_note-2"><span class="cite-bracket">[</span>2<span class="cite-bracket">]</span></a></sup> There are two types of R&D intensity: direct and indirect. R&D intensity varies, in general, according to a firm's industry sector, product knowledge, manufacturing, and technology, and is a metric that can be used to gauge the level of a company's investment to spur innovation in and through <a href="/wiki/Basic_research" title="Basic research">basic</a> and <a href="/wiki/Applied_research" class="mw-redirect" title="Applied research">applied research</a>. A further aim of R&D spending, ultimately, is to increase <a href="/wiki/Productivity" title="Productivity">productivity</a> (e.g., <a href="/wiki/Factor_of_production" class="mw-redirect" title="Factor of production">factor productivity</a>) as well as an organization's salable output. </p> <meta property="mw:PageProp/toc" /> <div class="mw-heading mw-heading2"><h2 id="Definition_and_aim_of_metric">Definition and aim of metric</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=1" title="Edit section: Definition and aim of metric"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <p>Generally speaking, R&D is seen as a main driver of societal and business innovation.<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (October 2015)">citation needed</span></a></i>]</sup> The <a href="/wiki/OECD" title="OECD">OECD</a>'s <i>Frascati Manual</i> describes R&D as "creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications."<sup id="cite_ref-OECD02Fr_3-0" class="reference"><a href="#cite_note-OECD02Fr-3"><span class="cite-bracket">[</span>3<span class="cite-bracket">]</span></a></sup> </p><p>R&D expenditure and R&D intensity are two of the key indicators used to monitor resources devoted to science and technology worldwide.<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (October 2015)">citation needed</span></a></i>]</sup> R&D intensity has been defined as "the ratio of expenditures by a firm on research and development to the firm's sales."<sup id="cite_ref-Meyer05_4-0" class="reference"><a href="#cite_note-Meyer05-4"><span class="cite-bracket">[</span>4<span class="cite-bracket">]</span></a></sup> William Leonard has described research intensity as "measured usually by ratios of scientific personnel to total employment or by R&D expenditures/sales" to gains in such variables as productivity, profits, sales, and asset status.<sup id="cite_ref-Leonard71_5-0" class="reference"><a href="#cite_note-Leonard71-5"><span class="cite-bracket">[</span>5<span class="cite-bracket">]</span></a></sup> R&D intensity is therefore a measure of a company's <a href="/wiki/R%26D" class="mw-redirect" title="R&D">R&D</a> spending toward activities aimed at expanding sector and product knowledge, manufacturing, and technology,<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (October 2015)">citation needed</span></a></i>]</sup> and so aimed at spurring innovation in and through basic and applied research.<sup id="cite_ref-CohenLevinthal90_6-0" class="reference"><a href="#cite_note-CohenLevinthal90-6"><span class="cite-bracket">[</span>6<span class="cite-bracket">]</span></a></sup><sup id="cite_ref-Burgelman0208_7-0" class="reference"><a href="#cite_note-Burgelman0208-7"><span class="cite-bracket">[</span>7<span class="cite-bracket">]</span></a></sup> Furthermore, it is aimed at increasing "<a href="/wiki/Factor_of_production" class="mw-redirect" title="Factor of production">factor</a> <a href="/wiki/Productivity" title="Productivity">productivity</a> and salable output".<sup id="cite_ref-Leonard71_5-1" class="reference"><a href="#cite_note-Leonard71-5"><span class="cite-bracket">[</span>5<span class="cite-bracket">]</span></a></sup><sup class="noprint Inline-Template noprint Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:No_original_research#Primary,_secondary_and_tertiary_sources" title="Wikipedia:No original research"><span title="This claim needs references to reliable secondary sources. (October 2015)">non-primary source needed</span></a></i>]</sup><sup class="noprint Inline-Template" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citing_sources" title="Wikipedia:Citing sources"><span title="This citation requires a reference to the specific page or range of pages in which the material appears. (October 2015)">page needed</span></a></i>]</sup> </p><p>There are two types of R&D intensity, calculated as follows:<sup id="cite_ref-European_Commission_8-0" class="reference"><a href="#cite_note-European_Commission-8"><span class="cite-bracket">[</span>8<span class="cite-bracket">]</span></a></sup> </p> <ul><li>Direct R&D intensity, calculated by dividing R&D expenditure by output</li> <li>Indirect R&D intensity, which quantifies the R&D expenditure embodied in the intermediate goods used in the production of another sector and can be calculated using Input-Output Tables</li></ul> <div class="mw-heading mw-heading2"><h2 id="In_enterprises_and_companies">In enterprises and companies</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=2" title="Edit section: In enterprises and companies"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <p>As the <a href="/wiki/National_Science_Foundation" title="National Science Foundation">National Science Foundation</a> explains: absolute levels of "R&D expenditures indicate the level of effort dedicated to producing future products and process improvements while maintaining current <a href="/wiki/Market_share" title="Market share">market share</a> and increasing operating <a href="/wiki/Efficiency" title="Efficiency">efficiency</a>. By extension, such expenditures may reflect firms' perceptions of the market's demand for new and improved technology." However, R&D intensity is the most frequently used measure "to gauge the relative importance of R&D across industries and among firms in the same industry."<sup id="cite_ref-NSF10_9-0" class="reference"><a href="#cite_note-NSF10-9"><span class="cite-bracket">[</span>9<span class="cite-bracket">]</span></a></sup><sup class="noprint Inline-Template" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citing_sources" title="Wikipedia:Citing sources"><span title="This citation requires a reference to the specific page or range of pages in which the material appears. (October 2015)">page needed</span></a></i>]</sup> Economic research on sixteen industries by William Leonard, "the relation [between investment and gains] appears two years after R&D spending and increases thereafter", although research intensity relates "less effectively" to "<a href="/wiki/Human_resources" title="Human resources">manpower</a> ratios [ratios of scientific personnel to total employment]."<sup id="cite_ref-Leonard71_5-2" class="reference"><a href="#cite_note-Leonard71-5"><span class="cite-bracket">[</span>5<span class="cite-bracket">]</span></a></sup> </p> <div class="mw-heading mw-heading2"><h2 id="Among_sectors">Among sectors</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=3" title="Edit section: Among sectors"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <p>R&D intensity differs between different sectors: <a href="/wiki/High_tech" title="High tech">high-tech</a> sectors (such as aircraft & spacecraft, electrical equipment, and pharmaceuticals) are characterized by the highest R&D intensity, while <a href="/wiki/Low_tech" class="mw-redirect" title="Low tech">low-tech</a> sectors (such as food products, iron and steel, and textiles) usually have low R&D intensity.<sup id="cite_ref-European_Commission_8-1" class="reference"><a href="#cite_note-European_Commission-8"><span class="cite-bracket">[</span>8<span class="cite-bracket">]</span></a></sup> In fact, R&D intensity could be used as the sole indicator to identify high-tech sectors.<sup id="cite_ref-European_Commission_8-2" class="reference"><a href="#cite_note-European_Commission-8"><span class="cite-bracket">[</span>8<span class="cite-bracket">]</span></a></sup> </p> <div class="mw-heading mw-heading2"><h2 id="By_countries_and_regions">By countries and regions</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=4" title="Edit section: By countries and regions"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div><p> R&D intensity for a <i>country</i> or larger political or geographical entity is defined as its R&D expenditure as a percentage of <a href="/wiki/Gross_domestic_product" title="Gross domestic product">gross domestic product</a> (GDP) of the entity. Generally speaking, developed countries have higher R&D intensities than developing countries.<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (October 2015)">citation needed</span></a></i>]</sup> As Eurostat noted in 2013, for a preceding period,<sup class="noprint Inline-Template" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Manual_of_Style/Dates_and_numbers#Chronological_items" title="Wikipedia:Manual of Style/Dates and numbers"><span title="The time period mentioned near this tag is ambiguous. (October 2015)">when?</span></a></i>]</sup><style data-mw-deduplicate="TemplateStyles:r1244412712">.mw-parser-output .templatequote{overflow:hidden;margin:1em 0;padding:0 32px}.mw-parser-output .templatequotecite{line-height:1.5em;text-align:left;margin-top:0}@media(min-width:500px){.mw-parser-output .templatequotecite{padding-left:1.6em}}</style></p><blockquote class="templatequote"><p>The European Union (EU) is currently lagging behind both the USA and Japan in terms of expenditure on R&D as a proportion of GDP, primarily due to slow relative growth in business R&D expenditure. The European Council set an overall target of 3% of GDP by the year 2010, with industry asked to contribute two thirds of this objective.<sup id="cite_ref-10" class="reference"><a href="#cite_note-10"><span class="cite-bracket">[</span>10<span class="cite-bracket">]</span></a></sup></p></blockquote> <p>GERD can be broken down among four sectors of performance: business enterprise, higher education, government, and private not-for-profit institutions serving households (PNP).<sup id="cite_ref-OECD13_11-0" class="reference"><a href="#cite_note-OECD13-11"><span class="cite-bracket">[</span>11<span class="cite-bracket">]</span></a></sup> </p> <div class="mw-heading mw-heading2"><h2 id="See_also">See also</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=5" title="Edit section: See also"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <ul><li><a href="/wiki/Innovation" title="Innovation">Innovation</a></li> <li><a href="/wiki/Research_and_Development" class="mw-redirect" title="Research and Development">Research and Development</a></li></ul> <div class="mw-heading mw-heading2"><h2 id="References">References</h2><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=R%26D_intensity&action=edit&section=6" title="Edit section: References"><span>edit</span></a><span class="mw-editsection-bracket">]</span></span></div> <style data-mw-deduplicate="TemplateStyles:r1239543626">.mw-parser-output .reflist{margin-bottom:0.5em;list-style-type:decimal}@media screen{.mw-parser-output .reflist{font-size:90%}}.mw-parser-output .reflist .references{font-size:100%;margin-bottom:0;list-style-type:inherit}.mw-parser-output .reflist-columns-2{column-width:30em}.mw-parser-output .reflist-columns-3{column-width:25em}.mw-parser-output .reflist-columns{margin-top:0.3em}.mw-parser-output .reflist-columns ol{margin-top:0}.mw-parser-output .reflist-columns li{page-break-inside:avoid;break-inside:avoid-column}.mw-parser-output .reflist-upper-alpha{list-style-type:upper-alpha}.mw-parser-output .reflist-upper-roman{list-style-type:upper-roman}.mw-parser-output .reflist-lower-alpha{list-style-type:lower-alpha}.mw-parser-output .reflist-lower-greek{list-style-type:lower-greek}.mw-parser-output .reflist-lower-roman{list-style-type:lower-roman}</style><div class="reflist"> <div class="mw-references-wrap mw-references-columns"><ol class="references"> <li id="cite_note-NSF_R&D_2023-1"><span class="mw-cite-backlink"><b><a href="#cite_ref-NSF_R&D_2023_1-0">^</a></b></span> <span class="reference-text"><style data-mw-deduplicate="TemplateStyles:r1238218222">.mw-parser-output cite.citation{font-style:inherit;word-wrap:break-word}.mw-parser-output .citation q{quotes:"\"""\"""'""'"}.mw-parser-output .citation:target{background-color:rgba(0,127,255,0.133)}.mw-parser-output .id-lock-free.id-lock-free a{background:url("//upload.wikimedia.org/wikipedia/commons/6/65/Lock-green.svg")right 0.1em center/9px no-repeat}.mw-parser-output .id-lock-limited.id-lock-limited a,.mw-parser-output .id-lock-registration.id-lock-registration a{background:url("//upload.wikimedia.org/wikipedia/commons/d/d6/Lock-gray-alt-2.svg")right 0.1em center/9px no-repeat}.mw-parser-output .id-lock-subscription.id-lock-subscription a{background:url("//upload.wikimedia.org/wikipedia/commons/a/aa/Lock-red-alt-2.svg")right 0.1em center/9px no-repeat}.mw-parser-output .cs1-ws-icon a{background:url("//upload.wikimedia.org/wikipedia/commons/4/4c/Wikisource-logo.svg")right 0.1em center/12px no-repeat}body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-free a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-limited a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-registration a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .id-lock-subscription a,body:not(.skin-timeless):not(.skin-minerva) .mw-parser-output .cs1-ws-icon a{background-size:contain;padding:0 1em 0 0}.mw-parser-output .cs1-code{color:inherit;background:inherit;border:none;padding:inherit}.mw-parser-output .cs1-hidden-error{display:none;color:var(--color-error,#d33)}.mw-parser-output .cs1-visible-error{color:var(--color-error,#d33)}.mw-parser-output .cs1-maint{display:none;color:#085;margin-left:0.3em}.mw-parser-output .cs1-kern-left{padding-left:0.2em}.mw-parser-output .cs1-kern-right{padding-right:0.2em}.mw-parser-output .citation .mw-selflink{font-weight:inherit}@media screen{.mw-parser-output .cs1-format{font-size:95%}html.skin-theme-clientpref-night .mw-parser-output .cs1-maint{color:#18911f}}@media screen and (prefers-color-scheme:dark){html.skin-theme-clientpref-os .mw-parser-output .cs1-maint{color:#18911f}}</style><cite id="CITEREFAndersonMoris2023" class="citation web cs1">Anderson, G.; Moris, F. 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Retrieved <span class="nowrap">13 October</span> 2015</span>.</cite><span title="ctx_ver=Z39.88-2004&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Abook&rft.genre=bookitem&rft.atitle=Research+and+Development%3A+National+Trends+and+International+Linkages+%28Ch.+4%29&rft.btitle=Science+and+Engineering+Indicators+2010&rft.place=Arlington%2C+VA%2C+USA&rft.pub=National+Science+Foundation%2C+National+Center+for+Science+and+Engineering+Statistics%2C+National+Science+Board&rft.date=2010&rft.au=NSF&rft_id=https%3A%2F%2Fwww.nsf.gov%2Fstatistics%2Fseind10%2Fc4%2Fc4h.htm&rfr_id=info%3Asid%2Fen.wikipedia.org%3AR%26D+intensity" class="Z3988"></span><sup class="noprint Inline-Template" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citing_sources" title="Wikipedia:Citing sources"><span title="This citation requires a reference to the specific page or range of pages in which the material appears. (October 2015)">page needed</span></a></i>]</sup></span> </li> <li id="cite_note-10"><span class="mw-cite-backlink"><b><a href="#cite_ref-10">^</a></b></span> <span class="reference-text"><link rel="mw-deduplicated-inline-style" href="mw-data:TemplateStyles:r1238218222"><cite id="CITEREFAnon.2013" class="citation web cs1">Anon. (2013). <a rel="nofollow" class="external text" href="http://ec.europa.eu/eurostat/statistics-explained/index.php/Glossary:R_%26_D_intensity">"Glossary: R&D intensity"</a>. Eurostat<span class="reference-accessdate">. Retrieved <span class="nowrap">13 December</span> 2013</span>.</cite><span title="ctx_ver=Z39.88-2004&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Abook&rft.genre=unknown&rft.btitle=Glossary%3A+R%26D+intensity&rft.pub=Eurostat&rft.date=2013&rft.au=Anon.&rft_id=http%3A%2F%2Fec.europa.eu%2Feurostat%2Fstatistics-explained%2Findex.php%2FGlossary%3AR_%2526_D_intensity&rfr_id=info%3Asid%2Fen.wikipedia.org%3AR%26D+intensity" class="Z3988"></span></span> </li> <li id="cite_note-OECD13-11"><span class="mw-cite-backlink"><b><a href="#cite_ref-OECD13_11-0">^</a></b></span> <span class="reference-text">OECD (2013). "2. Building Knowledge, 5. R&D expenditure," In <i>OECD Science, Technology and Industry Scorecard 2013, OECD Publishing,</i> Paris, FR: OECD Publishing, DOI 10.1787/20725345 or DOI 10.1787/sti_scoreboard-2013-en, ISSN 2072-5345 or ISSN 1562-983X, <link rel="mw-deduplicated-inline-style" href="mw-data:TemplateStyles:r1238218222"><a href="/wiki/ISBN_(identifier)" class="mw-redirect" title="ISBN (identifier)">ISBN</a> <a href="/wiki/Special:BookSources/9789264203181" title="Special:BookSources/9789264203181">9789264203181</a> or <link rel="mw-deduplicated-inline-style" href="mw-data:TemplateStyles:r1238218222"><a href="/wiki/ISBN_(identifier)" class="mw-redirect" title="ISBN (identifier)">ISBN</a> <a href="/wiki/Special:BookSources/9789264205000" title="Special:BookSources/9789264205000">9789264205000</a> or <link rel="mw-deduplicated-inline-style" href="mw-data:TemplateStyles:r1238218222"><a href="/wiki/ISBN_(identifier)" class="mw-redirect" title="ISBN (identifier)">ISBN</a> <a href="/wiki/Special:BookSources/9789264200739" title="Special:BookSources/9789264200739">9789264200739</a>, see <a rel="nofollow" class="external autonumber" href="http://www.oecd-ilibrary.org/sites/sti_scoreboard-2011-en/02/05/index.html?itemId=/content/chapter/sti_scoreboard-2011-16-en">[2]</a> or <a rel="nofollow" class="external autonumber" href="http://www.oecd-ilibrary.org/science-and-technology/oecd-science-technology-and-industry-scoreboard_20725345;jsessionid=3onnh4h4aqjfj.x-oecd-live-03">[3]</a>, accessed 13 October 2015.</span> </li> </ol></div></div>    </div><noscript><img src="https://login.wikimedia.org/wiki/Special:CentralAutoLogin/start?type=1x1" alt="" width="1" height="1" style="border: none; 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