Analysis of the Hungarian research and development potential

Abstract

In our days research and development (R&D) increases in importance in all sectors of the economy. Recognizing the decisive role in boosting economic competitiveness and productivity of R&D, in March 2002 the European Council decided on increasing R&D expenditure to 3% of GDP in order to bridge the gap between the EU and its major competitors like the United States and Japan. By passing a law on R&D and innovation, and introducing a compulsory innovation contribution for companies, Hungary has taken important steps towards this objective. Yet, having reached halftime, the proposed goal seems extremely remote. In this study I will investigate the composition and evolution from the regime change to our days of the Hungarian R&D potential, including the number of research units, research intensity and R&D expenditure as a percentage of GDP. By means of time-series analysis models I will reveal the Hungarian R&D trends of the past 15 years and also predict the feasibility of achieving the EU objective. Towards the end of my study I will investigate the evolution and composition of "down-to-earth" results of the Hungarian R&D activity and suggest index numbers for comparison and to measure the results.