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Innovation and Research & Development - R&D Gross Expenditure

High Level Summary of Statistics Trend Last update: Thursday, March 30, 2017

R&D Gross Expenditure

Innovation and Research & Development (R&D) are important both for individual firms, and for the economy as a whole. R&D is a component part of the innovation process, characterised as work that increases the stock of knowledge or results in the creation of new products. The introduction of new products or processes, or improvements to existing ones, is a prerequisite for firms to survive, evolve and grow in an increasingly competitive environment. The ongoing process of innovation improves and increases the rate of technical progress in the economy and is recognised in empirical studies as an important source of productivity growth, which is ultimately a key determinant of regional economic growth.

In terms of Gross Expenditure on R&D (GERD), which includes businesses, higher education and government expenditure, Scottish expenditure as a proportion of GDP is below the EU average.  In 2015, GERD as a percentage of GDP was 1.46 per cent for Scotland and 1.95 per cent for the EU; a gap of 0.49 percentage points.  The Scottish Government has set a National Indicator to Increase R&D Spending. The indicator compares Scotland’s GERD as a percentage of GDP with the equivalent average figure for the EU 28.

GERD as a percentage of GDP

Source: Scottish Government, Organisation for Economic Cooperation and Development

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