Public R&D Expenditure Efficiency and Knowledge Creation in CEE Region


  • Dalibor Greganić University of Zagreb, Petra Hektrorovića 2; 10000, Zagreb, Croatia



R&D, public sector, knowledge creation, DEA, CEE


In this paper we use the data envelopment analysis (DEA) to analyze the efficiency of public expenditure on R&D in Central and Eastern European countries (CEE), using knowledge creation and knowledge diffusion as key output indicators. Our results show that most CEE countries do not use public R&D resources efficiently and that the current level of expenditure should generate much better results on the Global Innovation Index scale. Thus, we believe that instead of increasing the level of public expenditure on R&D, the CEE countries need to increase efficiency first. In order to do so, these countries should continue to improve their institutional framework in terms of government effectiveness, business climate and suppression of corruption. The increase in R&D efficiency is of great importance for the CEE countries as they look for new knowledge-based growth models that are more challenging for policy makers than pre-crisis models, which were based on physical capital accumulation and adoption of technologies from abroad.


ARISTOVNIK, A., (2012). The relative efficiency of education and R&D expenditures in the new EU member states. Journal of business economics and management, Vol. 13, No.5, pp. 832–848. DOI:

CINCERA, M., CZARNITZKI, D., & THORWARTH, S. (2011). Efficiency of public spending in support of R&D activities. Reflets et perspectives de la vie économique, Vol. 50, No. 1, pp.131–139. DOI: 10.3917/rpve.501.0131

COELLI, T. (1996). A guide to DEAP version 2.1: a data envelopment analysis (computer) program. Centre for Efficiency and Productivity Analysis, University of New England, Australia.

DUTTA S., LANVIN, B. & WUNSCH-VINCENT, S. (2017). The Global Innovation Index 2017 Innovation Feeding the World; Cornell University, INSEAD and the World Intellectual Property Organization.

WANG, E. C. & HUANG, W. (2007). Relative efficiency of R&D Activities: A cross-country study accounting for environmental factors in the DEA approach. Research Policy, Vol. 36, No. 2, pp. 260–273.

GRAVES, S. B. & LANGOWITZ, N. S. (1996). R&D Productivity: A Global Multi-industry Comparison. Technology Forecasting and Social Change, Vol. 53, No. 2, pp. 125-137. DOI:

LEE, H.Y. & PARK, Y.T. (2005). An international comparison of R&D efficiency: DEA approach. Asian Journal of Technology Innovation, Vol. 13; No. 2, pp. 207- 222. DOI: ROMER, P.M. (1990). Endogenous technological change. Journal of Political Economy, Vol. 98, No. 5, pp. 71–102., DOI:

ROUSSEAU, S. & ROUSSEAU, R. (1997). Data envelopment analysis as a tool for constructing scientometric indicators. Scientometrics, Vol. 40, No.1, pp. 45–56., DOI: 10.1007/BF02459261

ROUSSEAU, S. & ROUSSEAU, R. (1998). The scientific wealth of European nations: Taking effectiveness into account. Scientometrics, Vol. 42, No. 1, pp. 75–87., DOI: 10.1007/BFO26927.91 10 SHARMA, S. & THOMAS, V. (2008). Inter-country R&D efficiency analysis: An application of data envelopment analysis. Scientometrics, Vol. 76; No. 3, pp. 483– 501., DOI: 10.1007/s11192-007-1896-4

SOLOW, R.M. (1956). A contribution to the theory of economic growth. The Quarterly Journal of Economics, Vol. 70, No. 1, pp. 65–94., DOI: 10.2307/1884513

TEITEL, S. (1994). Patents, R&D expenditures, country size, and per-capita income: an international comparison. Scientometrics, Vol. 29; No. 1, pp. 137–159., DOI:

THOMAS, V.J., JAIN, S.K. & SHARMA, S. (2009). Analyzing R&D efficiency in Asia and the OECD: An application of the Malmquist productivity index. In: Science and Innovation Policy, 2009 Atlanta Conference (pp. 1–10). IEEE.

TODARO, M.P. & SMITH, S.C., (2014). Economic development. Pearson, New York, USA Werner, B.M.

WERNER, B.M. & SOUDER, W.E. (1997). Measuring R&D performance – state of the art. Research-Technology Management, Vol. 40; No. 2, pp. 34–42. DOI:




How to Cite

Greganić, D. (2018). Public R&D Expenditure Efficiency and Knowledge Creation in CEE Region. Socio-Economic and Humanities Studies, 8(2), 73–86.