An International Comparison of R&D Efficiency: DEA Approach

A prerequisite for making R&D more productive is to able to measure its productivity. Most of the previous studies on this topic have attempted to measure R&D productivity at the firm or industry levels. In this study, however, R&D productivity is measured at the national level to provide R&D policy implications, particularly for Asian countries. Contrary to the previous studies where total factor productivity was adopted, this study employs the data envelopment analysis (DEA) approach to measure R&D productivity. DEA is a multi-factor productivity analysis model for measuring the relative efficiency of each Decision Making Unit (DMU). In addition to the basic DEA model that includes all inputs and outputs, five additional models are constructed by combining single input with all outputs and single output with all inputs in order to measure specialized R&D efficiency. In this study, the twenty-seven countries are classified into four clusters based on the output-specialized R&D efficiency: inventors, merchandisers, academicians, and duds. Then, the characteristics of the Asian countries with respect to R&D efficiency are identified. It is found that Singapore ranks high in total efficiency, and Japan in patent-oriented efficiency. Meanwhile, China, Korea, and Taiwan are found to be relatively inefficient in R&D. We expect that the findings from this study will be able to provide directions for R&D policy-making of the Asian countries.