Budget Decision-Making for Research and Development

Abstract

As an initial examination of the relevance of the systems rame of reference developed in the preceding chapter we shall examine the pattern and distribution of decision-making techniques employed by various types of firms in deciding the R & D budget. As will be demonstrated, there are occasionally substantial differences between groups of firms separated by time and international boundaries, and reasons will be suggested for such differences. The analysis of the chapter may be seen as a direct development of the early section of the previous chapter in which were discussed problems of abstraction in complex systems. It may be regarded as interpreting Simon’s statement, ‘Man … is a pattern finding animal’, as a testable hypothesis since it discusses requirements for establishment of patterns in R & D budgeting, and attempts to explain differences in budgeting convention in this light.