Models and measures to evaluate the effectiveness of funds utilization for scientific research and development of advanced technologies

Abstract

The purpose of this report was to construct some alternative methods to estimate the effectiveness of investments in scientific research and development of advanced technologies, especially their long-term effects. The Study Group decided to focus on the sub-problem of finding the relation between the spending on science and the quality of science itself. As a result, we have developed two independent methodologies. The most promising one is based on the theory of time-delay systems, which allows capturing effects of the time-lag between the use of funds and the results related to scientific work. Moreover, the methodology gives an opportunity to seek the optimal spending scenario that would fulfill some prescribed constraints (e.g. it would minimize costs and at the same time remain above a desired level of quality of science). The second methodology is premised on Stochastic Frontier Analysis and it can be applied to determine the form of relation between the amount of financing and the results of scientific work. It offers considerable advantages for analyses of several forms of relation at once (production functions) and for a suitable choice of the best one. Both methods are promising, however, additional work is necessary to apply them successfully to some real-life problems.