Saturday, August 22, 2009

Toward a debate on Science and Technology Policy in Ireland

There has been a large amount of activity in recent weeks debating the extent to which the government should support science and technology in the universities, and the likely impact that such spending will have on the wider economy and society and through which particular channels.

Some of this debate is a continuation of a long-standing discussion on two government strategy documents, the "Strategy for Science, Technology and Innovation" and the "Framework for Economic Renewal" (Smart Economy) document.

Discussion has also likely increased as a result of the opinion expressed in the McCarthy report that there was little evidence of value deriving from R+D activities. The McCarthy report opinion on university research funding is below.

"The two research councils, Irish Research Council for the Humanities and Social Science (IRCHSS) and Irish Research Council for Science, Engineering and Technology (IRCSET) provide funding for researchers in the form of post graduate scholarships, post doctoral fellowships, research fellowships and project based research. The Group supports the CEEU recommendation that the industry co-funding ratio should be increased for IRCSET’s enterprise partnership awards. Further, the Group is of the view that the allocation to the research councils to increase Ph.D. outputs should be reduced because of the uncertainty about the absorptive capacity of industry to employ fourth level graduates and the propensity of Ph.D. graduates to emigrate. The fifth cycle of the PRTLI scheme is due to run over the period 2010 to 2014. This scheme has been in operation since 1998 and there is insufficient evidence of the positive economic impact of the programme to date. Subject to any contractual commitments, this cycle should be cancelled. This will lead to savings in future years as spending on earlier cycles of PRTLI winds down without any new funding requirements arising in their place. The cancellation should also have imfor SFIfunding given that SFI researchers are housed in PRTLI funded infrastructure."

A number of economists have written critical articles about the current direction of S+T policy:

Eoin O'Leary

Karl Whelan

Kevin O'Rourke

Richard Tol

MIchael Hennigan

A number of further articles have defended large scale funding of university research

Luke O'Neill

Ferdinand von Prondzynksi

The importance of this debate cannot be understated, not least for people (many of whom read this blog) who have devoted most of their lives to research and teaching in university contexts. The charge of being a "vested interest" is frequently hurled at people who express opinions in this area. But anyone who works in a university or in research has a vested interest in this, and we have to try to deal with that and put forward coherent views that can be debated. If the charge is true that no-one working in research can express an objective view about how it should be funded and structured then we all should stop now.

It has also been agreed by many on both sides of the debate that if you simply start counting direct revenue generated from university patenting and licensing activities, that you are not going to find a good justification for funding research in universities, certainly not a healthy economic return. It seems to me obvious that Ferdinand von Prondzynski's point is correct that indirect rather than direct measures of benefits from research funding needed to be prioritised. To that extent, we need to start talking about issues such as:

- whether research funding in a university improves the quality and return to education in that university. Related to this, do students who are taught by and interact with top researchers become better equipped to work with cutting edge technologies and so on.

- the extent to which having research groups in Ireland that are embedded into international networks has value is something again I want to debate without assumption. many of us here base a huge amount of our working life on the (untested) assumption that working with international colleagues who are excellent in their field improves our work and improves the quality of knowledge in our respective fields in Ireland. the thing that impresses me when I see some of the better SFI-funded programmes is the international networks that such programmes open up to people in Irish universities. I have to admit that I have always viewed this as having huge value and this is my default assumption. having said that, to argue that a huge amount of money should be spent on developing these networks on the basis of an assumption would be silly.

- the extent to which multinational companies based location decisions on factors such as PhD researchers available, ability to draw from local research groups and so on.

- the extent to which indigenous companies can draw expertise and tools from research clusters based in universities. how much is this happening in Ireland at present?

- the extent to which research funding potentially improves non-market outcomes. For example, to what extent does funding Irish health research impact on hospital functioning and on the integration of global technologies into Irish healthcare. Every time this get's mentioned somebody makes a scoffing remark. My instinct (completely open to being tested and just an opinion) is that medical consultants who are conducting leading edge research (even if in specific areas) are constantly thinking about where modern health technologies are developing and are better equipped to integrate global technologies. Testing this in the Irish case would be very difficult but it is certainly a channel that we would be stupid to dismiss without thinking further about it.

From the point of view of economists, our role is not just to shoot down every claim that isn't 100 per cent backed up. It is also to examine potential channels that generate increases in human welfare and to think about testing them. We should try to put all of the chess pieces on the board before getting fully started on this.


Ferdinand von Prondzynski said...

Liam, I think this is a very fair summary of the issues. I am actually in agreement that careful analysis needs to be applied, but was getting worried that a kind of hysteria was building up that wasn't based on any real evidence.

Clearly we do need to demonstrate the value of the investment. But not every investment can be based on empirical evidence guaranteeing a return; if that was the case, then we should never allow an entrepreneur to get down to business. Nevertheless, in this case there is evidence from international sources.

Your contributions to the debate have added a lot of balance.

Martin Ryan said...


There are some descriptive statistics (now a little dated) that provide information about economic activity related to STEM (Sci/Tech/Eng/Math) areas from research conducted by Eamonn O'Raghallaigh at Life Science Recruitment (in 2008).

This research states that:

(i) employment in Ireland's pharmaceutical/chemical sector increased by 56% over the previous 10 years, and there were over 24,500 employees within the sector

(ii) in the medical devices/biotechnology sector, about 140 companies employed over 26,000 employees

(iii) exports in the pharmaceutical/chemical sector totalled €43.5 billion in 2007; this represented 49% of total Irish exports (does anyone know how much of exports is/was accounted for by medical devices/biotechnology?)

(iv) the medical devices/biotechnology sector saw a slight downturn in 2007, with exports falling by 2% to €3 billion

This statistics don't prove anything on their own, but it's worth knowing them.