Energy research and R&D indicators: An LMDI decomposition analysis for the IEA Big 5 in energy research

Abstract

The literature has always shown that there are two important factors in the improvement of a country's research output: Gross Domestic Product (GDP) and R&D Expenditures. Taking the discussion a step further, and in an effort to provide policy recommendations on what is needed to boost research capacity, this paper aims at decomposing the change in energy research papers of five countries (Australia, Canada, Germany, UK and US) into four factors: GDP, R&D intensity (ratio of total R&D to GDP), energy R&D rate of return or productivity (number of energy-related papers per unit of energy R&D expenditure), and energy R&D priority (share of energy R&D to total R&D expenditure).The findings show a general trend in the sign of the four effects on research for all five countries: energy R&D productivity, energy R&D priority, and GDP are mostly found to be positive contributors, while the R&D intensity a negative one. This pattern has exceptions that are more prominent during periods where economic growth is constrained, for example during 2008/09. The results have policy implications not only for these five countries but also for developing countries (low GDP) that aim at contributing more to the energy-related research output globally.