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Research and Development (view source)
Revision as of 19:20, 10 February 2016
, 19:20, 10 February 2016no edit summary
===Status Quo===
[[Image:Private Spending.jpg|500px|thumb|left]] Much of today's research is still dominated by the largest firms. Corporations with more than 10,000 employees account for more than half of research spending, while small businesses with less than 500 employees account for less than one-fifth of R&D expenditures. [http://iveybusinessjournal.com/publication/rethinking-corporate-research-and-development/(Ivey Business Journal)] Research today is dominated by the very largest of firms.[http://files.eric.ed.gov/fulltext/ED502863.pdf (BerkleyBerkeley)] Corporations with over 10,000 employees still account for more than half the research spending. Those with fewer than 500 employees, a traditional definition of small a business, account for less than one-fifth of the total expenditures. These same patterns hold internationally.[http://iveybusinessjournal.com/publication/rethinking-corporate-research-and-development/(Ivey Business Journal)]
The Oxford Review of Economic Policy conducted a [http://oxrep.oxfordjournals.org/content/18/1/35.short study] on corporate financing of R&D. They found:
#Evidence for high costs of R&D capital for large firms is mixed, although these firms do prefer internal funds for financing these investments.
#There are limits to venture capital as a solution to the funding gap, especially in countries where public equity markets are not highly developed.
The National Science Foundation reported that "companies spent $323 billion on research and development performed in the United States during 2013, 6.7% more than the $302 billion spent during 2012. Funding from the companies’ own sources was $247 billion during 2012 and $265 billion during 2013, a 7.1% increase. Funding from other sources was $55 billion during 2012 and $58 billion during 2013. Data for this InfoBrief are from the Business R&D and Innovation Survey (BRDIS), which was developed and is cosponsored by the National Science Foundation and the U.S. Census Bureau." [http://www.nsf.gov/statistics/2015/nsf15329/ (NSF)]
===Corporate R&D Problems===
====Commitment Issues====
Josh Lerner, the Jacob H. Schiff Professor of Investment Banking at Harvard Business School, says companies have been too fickle in their commitment to new innovation initiatives. A historical lack of commitment in the corporate venture domain has made employees less likely to join a corporate venturing group they fund, entrepreneurs reluctant to accept their funds, independent venture funds hesitant to syndicate investments with these groups, and corporate funded start-ups find collaborations harder to arrange. In each case, the very real possibility that the rug will be pulled out from under the corporate venture initiative leads others to be reluctant to work alongside them. [https://hbr.org/product/the-architecture-of-innovation-the-economics-of-cr/an/10796-HBK-ENG Harvard Business Review]
