The economic impact of public investment in research
During my time as an Irish university president I got used to hearing commentators – often economists – arguing that the investment of public money in academic research did not represent good value. It was suggested regularly – and indeed this was done several times in comments on this blog – that there was no evidence that such investment produced any benefits to the state or the taxpayer.
It is therefore interesting that an independent analysis commissioned by the Higher Education Authority (Ireland’s higher education funding agency) has now quantified the benefits. It has found that the investment by the state in the Programme for Research in Third Level Institutions (PRTLI) of €1.173 billion has yielded some significant results. It has produced 43 spin-out companies and has commercially assisted 113 other companies. The commercial impact to date is estimated at €753 million. Over the next five years the commercial impact is estimated at €1.108 billion. If these figures are borne out, the net financial return on the investment will be over €700 million. However, this does not factor in the impact on foreign direct investment or start-ups that have been prompted by the availability of high value expertise or the support of graduates from funded research programmes.
It is difficult to argue that significant public investment in research is bad value for money. The opposite is true, and it is to be hoped that during difficult economic times in particular the investment will continue.