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The link between HIs and CoEs funding

Each HI allocates a fraction of its total research budget to fund and support the activities of hosted CoEs. According to the data provided by respondents, the share of HIs’ total research budget allocated to the CoEs’ activities represent on average 9% of each HI’s total research budget.6 This share, which is a proxy for the intensity with which HIs fund the research of CoEs, differs significantly across the sample of HIs from a minimum of 0.01% to a maximum of around 68%.

HIs for which the share of the total research budget allocated to CoEs is above 9% are categorised here as CoE-intensive HIs. Those for which the share is below 9% are categorised as CoE-non-intensive HIs (see Box 4.1).

Box 4.1. HIs’ total research budget and intensity of CoEs

Because the survey collected data on both the funding allocated annually to centres of excellence (CoEs) at each host institution (HI) and the total research budget of each HI, it was possible to determine the approximate weight (i.e. intensity) of the CoEs’ research activities in each HI’s total activities. In the sample, the CoE budget represents on average 9% of each HI’s total research budget. This average value is used as a threshold to group HIs by CoE intensity as follows:

  • • The CoE-non-intensive HIs are those for which the share of HIs’ total research budget allocated to CoEs’ activities is equal to or below 9%. The CoE-non-intensive HIs are, hence, those in which the research activities of the CoEs represent a relatively minor share of their total research activity: 44 HIs are in this category.
  • • The CoE -intensive HIs are, instead, those that allocate a relatively larger fraction (above 9%) of their total research budget to finance and support the research activities of the hosted CoEs: 17 HIs fall into this category and are considered CoE-intensive.

Interestingly, the CoE-non-intensive HIs are endowed with larger total research budgets (USD 294 million (PPP) on average) while the CoE-intensive HIs are generally smaller (USD 73 million (PPP) on average).

It is important to bear in mind, however, that the financial data collected may, in some cases, not be fully reliable owing to the difficulties encountered by some respondents in identifying overall research expenditures and available budgets. In a limited number of cases, the self-reported data for the overall HI’s research budget was smaller than the amount allocated to the hosted CoEs. In others, the data on the total research budget was very different from publicly available official data. Where there was a lot of uncertainty about the reliability of the data, the data on the total research budget were not used in order to avoid biased results. This problem is not unique to this study. In the context of the revision of the Frascati Manual efforts are under way at the OECD to improve the reliability and comparability of official R&D data on higher education expenditure on R&D (HERD) (see www.oecd.org/sti/inno/frascati-manual-revision.htm). Measurement challenges are linked to the difficulty of separately identifying R&D from other activities in this sector.

The relative weight of CoEs’ research activities in each HI’s total research activity (i.e. the CoE intensity) is likely to be related to the type of funding scheme used to provide financing to the CoE (Figure 4.9). Around 80% of CoE-non-intensive HIs contribute to the running costs of their CoEs but this drops to 41% of the CoE-intensive HIs. This may be because CoE-intensive HIs, even if allocating a larger share of their budget to the research activities of their hosted CoEs, are also, on average, endowed with smaller overall research budgets (around USD 73 million PPP, see Box 4.1) and, hence, have less possibility to support the activities of the hosted CoEs directly.

Figure 4.9. Funding schemes by CoEs’ share of the HI’s total research budget

Source: OECD/RIHR Survey to Host Institutions, 2012.

As regards the expected financial effects of hosting a CoE, significant differences appear when the total sample of HIs is split into CoE-intensive and CoE non-intensive HIs. Figure 4.10 shows that 71% of CoE-intensive HIs expect that the support they provide to research activities of hosted CoEs will make it easier to obtain subsequent REI funding but the figure drops to 45% for CoE-non-intensive HIs. CoE-intensive HIs also emphasise the role played by the activities of the hosted CoEs in attracting additional third-party funds or REI funds in the future. Yet, while only 29% of CoE-intensive HIs see CoEs’ activity as an important driver of additional funding from their core funding body, almost 90% of CoE-non-intensive HIs do so.

Figure 4.10. Financial effects by CoE funding intensity

Source: OECD/RIHR Survey to Host Institutions, 2012.

These results indirectly reveal the different expectations of the two groups. CoEintensive HIs, with smaller total budgets for research, seem to be more dependent on third-party or external funds (such as those of REIs) and hope to use the higher status and visibility granted by hosting a CoE to raise additional funds in the future. HIs endowed with larger total research budgets, and for which the importance of CoE activities may be relatively minor, rely more on the possibility of raising additional funds from their traditional funding schemes.

 
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