The R&D Function

Abstract

The purpose of this chapter is to examine the R&D function, its strategic problems and internal organisation, from the perspective of economics. We shall analyse the economics of R&D activity in terms of four basic features or characteristics, and then consider the implications of these characteristics for function, strategy and structure. We hope to show that these characteristics are recurring features of analysis, often underlying a wide variety of issues and problems that have frequently been treated independently of each other in separate literatures and approaches. We start by examining the four characteristics, before examining in turn their implications for R&D activity, strategy and internal organisation.

Originally published as ‘The R&D function: strategy and structure’, in G. Dosi, C. Freeman, R. Nelson, G, Silverberg and L. Soete (eds) Technical Change and Economic Theory, London: Frances Pinter, 1988, pp. 282–94. Reprinted by kind permission of Cassell Academic, Wellington House, 125 Strand, London WC2R 0BB, UK.