The Tangible Contribution of R&D Spending Foreign-Owned Plants to a Host Region: a Plant Level Study of the Irish Manufacturing Sector (1980-1996)

We use plant-level data to summarise the incidence and intensity of
R&D activity in foreign affiliates in Ireland. Tables 5 and 6 show the
percentage of the population of foreign-owned plants with ten or more
employees undertaking R&D in 1986 and 1993, the latest year for which
the data are available.

(Table 5)

Table 5 takes the population of 691 foreign-owned plants with ten or more
employees in 1986. Approximately 14 per cent of these plants engaged in
a minimum amount of R&D spend in 1986 in the Irish manufacturing
sector.¹⁵ The mean R&D spend per plant was £400,000 and the mean
number of R&D personnel employed in R&D was 13 persons per plant.¹⁶
Of the total population of foreign-owned plants, less than ten per cent had
a formal R&D department. Using a subset of the population of R&D
spending plants for which sales information is available, we calculated that
the mean intensity (R&D Spend / Sales) of the foreign-owned R&D-active
plants was 4 per cent. This estimate of R&D intensity for R&D-active
foreign-owned plants is significantly higher than the aggregate OECD
estimate (which covers all plants) of 1.17 per cent (Table 3).

It is possible to disaggregate further these totals by nationality of
ownership. We divide our population of plants on the basis of whether
their parent plant is located in Europe, North America or Asia-Pacific.¹⁷
The European plants comprise the largest single group of foreign-owned
plants in the Irish manufacturing sector. However, only 10 per cent of
these plants conducted R&D in 1986 compared with almost 20 per cent in

¹⁵ This is at least £25,000 Irish punts (the salary for one researcher).

¹⁶ This is not Full Time Equivalents. This is the number of people who have some involvement in
R&D activities without accounting for the time with which they are involved.

¹⁷ We define Asia-Pacific as a term summarising plants from Australia and Asia.

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