Some factors correlated with fluctuations in research and development spending

The author investigated the reasons why R&D spending by organizations other than the federal government appears to vary about a seemingly steady value as a percentage of the GNP. He found several highly correlated factors. Three of these factors correlated positively with nonfederal R&D spending over limited periods of time in the last three decades: the space program in the 1960s; the high rate of change in energy prices in the 1970s; and the availability of the R&D tax credit in the 1980s. A fourth correlated factor was found between a leading real interest rate and nonfederal R&D spending. After removing these effects, only a small underlying increase was found annually in nonfederal R&D spending when expressed as a percentage of the GNP