|Appendix 2: |
In this report, R&D refers to actual research and
development activities as well as R&D facilities. These definitions are used
by the Office of Management and Budget, the National Science Foundation, and AAAS.
Research is systematic study directed
toward more complete scientific knowledge or understanding of the subject studied.
The federal government classifies research as either basic or applied according
to the objective of the sponsoring agency.
basic research the objective is to
gain knowledge or understanding of phenomena without specific applications in
applied research the objective is to
gain knowledge or understanding necessary for meeting a specific need.
Development is the systematic use of the
knowledge or understanding gained from research directed toward the production
of materials; devices; systems; or methods, including design, development, and
improvement of prototypes and new processes. It excludes quality control, routine
product testing, and production.
R&D funding normally includes those personnel,
program supervision, and administrative support costs directly associated with
R&D activities. Laboratory equipment is also included. Defense R&D also
includes testing, evaluation, prototype development, and other activities that
precede actual production.
R&D facilities (also known as R&D plant) includes construction, repair,
or alteration of physical plant (e.g.,
reactors, wind tunnels, particle accelerators, or laboratories) used in the conduct
of R&D (R&D facilities construction). It also includes major capital equipment
used for R&D.
allocation of agency budgets among basic research, applied research, and development
is not an exact procedure; a certain arbitrariness is inevitably involved. The
severe time pressures under which these figures are compiled for OMB are also
a problem. Nevertheless, there is presumably
some consistency within each agency’s estimates so that the trends are meaningful.
The federal R&D funding data in this report are
presented in terms of budget authority.
Budget authority is the initial budget parameter for congressional action on the
President’s proposed budget. Other R&D data sources may express R&D funding
in terms of obligations or outlays. There
are also R&D data sources that obtain funding data from funding recipients
(companies, universities) rather than from funding sources
is the legal authorization to expend funds.
Obligations represent orders placed, contracts
awarded, services received, and similar transactions during a given period, regardless
of when the funds were appropriated and when the future payment of money is required.
Outlays represent checks issued and
cash payments made during a given period, regardless of when the funds were appropriated
or obligated. Some surveys refer to outlays as expenditures.
As an example, Congress may appropriate $100 million
to NASA in FY 2004 for an R&D laboratory. NASA may then issue contracts to
build the lab and sign $50 million of the contracts in FY 2004 and $50 million
in FY 2005. Upon completion of the lab in FY 2005, NASA may then write checks
to the contractors for a total of $100 million. Budget authority would be $100
million in FY 2004; obligations would be split $50 million each in FY 2004 and
FY 2005; outlays would be $100 million in FY 2005. In the federal budget process,
there is normally a lag between budget authority and outlays for large capital
projects and research contracts; budget authority and outlays usually occur in
the same year for recurring expenses such as staff salaries.
adapted from National Science Foundation, Federal
R&D Funding by Budget Function: Fiscal Years 2003-2005, Arlington,