What determines industrial R&D expenditure in the UK?

Bettina Becker, Nigel Pain

Research output: Contribution to journalArticlepeer-review


In this paper we identify some of the factors behind the comparatively poor R&D performance of the UK in the 1990s, when R&D intensity in the business sector declined consistently. We estimate an econometric model of R&D using a panel of UK manufacturing industries. Our results highlight the importance of industry characteristics such as sales and profitability, product market competition, macroeconomic factors such as interest and exchange rates, and the composition of R&D expenditure and funding. A rise in the share of government-funded R&D or the share of foreign R&D is found to have a positive impact on aggregate R&D expenditure.
Original languageEnglish
Pages (from-to)66-87
Number of pages27
JournalManchester School
Issue number1
Early online date21 Dec 2007
Publication statusPublished - Jan 2008


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