Useful Stats: Overall R&D intensity by state (2002-2016)

How has the intensity of research and development (R&D) performance changed across states and over time? As a follow up to an article in last week’s Digest that examined changes in total R&D expenditures for each state over the 15-year period from 2002 to 2016, this week’s Useful Stats focuses on R&D intensity. Overall R&D intensity is defined as total R&D expenditures (the sum of all R&D performed by industry, federal labs and agencies, colleges and universities, and other research institutions in a state) as a share of each state’s gross domestic product in a given year.  Notably, five states stand out for exceeding the national average in both R&D intensity and increases in R&D intensity from 2002 to 2016: Oregon, Delaware, California, Maryland, and Massachusetts.

Data on total research and development and overall R&D intensity stem from the NSF’s National Center for Science and Engineering Statistics’ (NCSES) National Patterns of R&D Resources series. In this article, SSTI has analyzed the available data for the most recent 15-years.

The map below highlights the changes in total R&D intensity across states between 2002 and 2016. Bubble size represents total R&D intensity (total R&D as a share of each state’s gross domestic product in a given year), while shading represents changes in intensity over time.

In 2016, the states where overall research and development comprised the largest share of gross state product were New Mexico (6.8 percent of GDP), Massachusetts (5.7 percent), Maryland (5.7 percent), California (5.2 percent), and Washington (4.8 percent). Meanwhile, R&D intensity was the lowest in Louisiana (0.4 percent), Nevada (0.5 percent), and Arkansas (0.6 percent).

Over the 15-year period from 2002 to 2016, there was an increase in R&D intensity in 22 states, led by Wyoming (95.0 percent increase), Missouri (83.9 percent increase), and North Carolina (51.4 percent increase). West Virginia (47.9 percent decrease), Alaska (42.1 percent decrease), and Vermont (40.9 percent decrease) were among the majority of states that experienced a decline in R&D intensity over this period.

The chart above looks at overall R&D expenditures and changes in R&D intensity over time. As can be seen in the chart, five states stand out for exceeding the national average in both R&D intensity and increases in R&D intensity from 2002 to 2016: Oregon, Delaware, California, Maryland, and Massachusetts. On the other hand, the majority of states lie in the lower-left quartile, which means overall R&D intensity in these states is lower than the national average, and that they are becoming relatively less R&D intensive. This suggests geographic unevenness in the concentration of R&D.

As was discussed last week, data on total R&D expenditures are useful for practitioners as a proxy for innovation, but there are limitations. R&D intensity is a particularly useful statistic for comparing the overall importance of innovation in a state’s economy over time and compared to other states. In the final part of this series, next week’s Digest article will examine how the composition of performance of each state’s overall R&D has changed over the 15-year period.

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