• Capitalizing computer software for inclusion in the national accounts and moving from there to other intangibles such as human capital, including R&D embodied in education; and
  • Developing a model of the national accounts that incorporates nonmarket values, including household production.

Any of these steps would require the commitment of additional resources, which in turn would depend on whether researchers and policy makers value the results relative to other data needs. The workshop did not explore the utility of extending the satellite account, but some participants suggested that BEA and NSF seek the opinions of analysts and public officials.

Other Issues Raised

It was noted that processing RD-1 data could be improved by updating hardware, software, and methodological practices, including automating sample selection, submitting forms to respondents, collecting forms from respondents, editing and auditing reported data, and applying data-nondisclosure procedures.

Inconsistencies between RD-1 survey responses and 10-K information from the same firm are troublesome to many analysts. Although the sources of these discrepancies are not all known, it does not help that the reports are prepared by different units within firms. As a possible remedy it was suggested that the RD-1 survey present companies with the R&D numbers they reported in their 10-Ks and ask respondents to ensure that their disaggregated data are consistent with their companywide 10-K report. Other workshop participants expressed concern that in reporting data to the SEC, companies have incentives to enhance the value of their stock, and therefore the data may not be as reliable as the responses to Census surveys.

Other issues regarding the NSF RD-1 survey were raised but not discussed in detail during the workshop. These included whether questions about the composition of R&D that have been removed from the survey should be reinstated or are too ambiguous to be useful (e.g., process vs. product and short-term vs. long-term R&D). It was also questioned whether R&D expenditures should be collected by product class and, if so, what product classification should be used. Some participants noted that the product field classification of industry detail in the NSF R&D survey is not very useful, as it corresponds neither to Standard Industrial Classification (SIC) codes nor to what the Federal Trade Commission (FTC) considers to be distinct markets. Furthermore, the level of detail of the product fields has been reduced. This is an important loss of information in, for example, the capital goods sector. It was suggested that these be reviewed.



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