In the last decade and a half China, which has grown at an annual average of 10%, has increased its spending on research and development by 170%.
Of course, we need both general stimulus spending – in areas such as healthcare, education and infrastructure – and directed investment in strategic new technologies and sectors. But the global economic race will be won mainly on the latter, and the winners will earn more profits for welfare programmes. Indeed, as has been shown in research by the National Institute of Standards and Technology, the investment multiplier is higher when public investment is directed to growth areas rather than just “digging ditches” and filling them up again. But direction requires vision, courage, and solidarity – all casualties of the latest European crisis.
I do hope I’ve got this straight. China’s increase in R&D spending is used as an argument that we Europeans should increase our R&D sending, yes?
China’s been growing at 10% per year for 15 years. GDP of 100 at the start of that period would be 417 at the end of it. Or a 317% rise in GDP if you prefer.
And R&D spending has risen by 170%. That is, fallen substantially as a portion of GDP.
This is used as an argument in favour of increasing R&D spending, is it?