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R&D as rent seeking

8 comments

David Leyonhjelm bells the cat:

A lot of the noise about a lack of R&D funding comes from the scientists looking for work. They mainly focus their attention on government, often out of habit but also because government funding often comes with less conditions. But in reality they don’t care as long as someone pays.

Many of the public servants involved in policy development similarly assume there should be a higher level of government funding, although not if it means a reduction in their budgets.

I’m not sure that government funding comes with fewer conditions – it certainly comes with no market test. Filling out heaps and heaps of forms is much less onerous, albeit more tedious, than trying to turn a profit.

Written by Sinclair Davidson

March 11th, 2013 at 11:33 am

8 Responses to 'R&D as rent seeking'

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  1. Having been involved with R&D applications for 2 small Australian mbusiness enterprises, one in the 1980′s and the other in the 1990′s, I know that the money is just a subsidy to gummint mates.

    NoFixedAddress

    11 Mar 13 at 11:49 am

  2. Another is expenditure on environmental issues, particularly climate change and ‘sustainability’. Again, this has no impact on productivity. Moreover, unless the predictions of global warming turn out to be true (and even the Chairman of the IPCC now concedes there has been no warming for the past 17 years), all the expenditure on it will have been essentially worthless.

    Article makes some good points.

    laterite

    11 Mar 13 at 12:07 pm

  3. The author has picked out quite accurately the problem with R&D as it stands today particularly with, but not restricted to, agriculture.

    Researchers mostly drive programmes which are investigated and even though they usually include growers and producers on the selection panel for projects, the researchers can usually talk the growers around to their way of thinking (or just talk over them if they put up some resistance).

    He used the example of GM technology which to date has brought us nothing much other than the ability of Monsanto to sell more glyphosate. This comment ignores the benefits of BT cotton which does actually reduce pesticide use and minimises the effects of pests on the crop. However, this is small beer compered to the main game which is glyphosate which is the worlds most traded agricultural pesticide commodity.

    All the other benefits of GM technology (e.g. drought and frost resistant plants, pharmaceutical and nutritional attributes) that can be built into plants have largely failed to materialise either through lack of remuneration or the technology is too hard.

    So, all we have ended up with is public scientists using the industry body funds as their own private bank for their own pet projects, and ignoring the requirements of the private sector who has largely funded them.

    This is not an Australian problem only, it is endemic within the advanced economies and Western group of nations.

    Charles

    11 Mar 13 at 12:14 pm

  4. But in reality they don’t care as long as someone pays.

    The other way to do it is to have idea, develop the idea then float a company to exploit the idea and get rich.

    Unfortunately as we know well most academics are lefties so this is rather unlikely to happen. And it won’t come from large companies who are closing their R&D efforts and relying on universities and the CSIRO.

    Bruce

    11 Mar 13 at 1:02 pm

  5. @Charles

    all we have ended up with is public scientists using the industry body funds as their own private bank for their own pet projects, and ignoring the requirements of the private sector who has largely funded them.

    may I quote you?

    NoFixedAddress

    11 Mar 13 at 2:01 pm

  6. The other way to do it is to have idea, develop the idea then float a company to exploit the idea and get rich.

    Bang. That’s it in a nutshell.

    tbh

    11 Mar 13 at 2:08 pm

  7. I am reading bordrin and levine’s case against intellectual monopoly book. a very powerful attack on what most take for granted.

    the software industry prospered in the USA until 1981 without copyright. was there a step increase burst in software writing after copyright extended to software?

    Jim Rose

    11 Mar 13 at 6:04 pm

  8. free markets dont do everything well (i wish they could ) . some kinds of r and d fall into this category . government should help . govt research gave us the internet and so much else .

    sunshine

    11 Mar 13 at 8:54 pm

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