compensation of personnel and current expenditure other than compensation of personnel^9. Capital
outlays^10 refer to the amount of capital formation within the observed year, regardless of whether it was
financed by current revenues or borrowing.
The general government expenditure by functions (classification COFOG), as has been seen, provides
information on education outlays. It should be noted however that consistency between the two
definitions and data coverage is not straightforward. A few issues should be taken into account:
The UOE expenditure on education is collected on a cash accounting basis rather than on an accrual one
as in the SNA framework of ESA95;
The distinction between current and capital outlays within the UOE data collection does not reflect the
same classification followed by the SNA;
In the UOE data collection there are many breaks in the time series causing problems of comparability
over time and across countries;
The definition of sectors performing education expenditures might differ between the two classifications
COFOG and UEO;
R&D
The OECD has been collecting data on R&D for Member countries since the early 1960s. Figures are
published in the Main Science and Technology Indicators report. R&D statistics are collected according
to the methodology developed in the so called Frascati Manual^11 on the basis of retrospective surveys of
the units actually carrying out or performing R&D projects. The coverage of fields of science includes
natural sciences and engineering, and social sciences and humanities. Data relate to R&D performed by
four sectors: i) Business Enterprise (Industry), ii) Higher Education, iii) Government and iv) Private Non-
Profit institutions. R&D expenditure is also classified by five sources of funds which include the four
above-mentioned sectors of performance plus funding from abroad.
Resources devoted to R&D are measured both in terms of researchers and total amount of personnel
employed in R&D, and in terms of expenditures. Personnel data are expressed in full-time equivalent and
refer to all personnel working on R&D. It should be noted, however, that sometimes international
comparisons are restricted to researchers or university graduates since they are considered as the core of
the R&D system. As to outlays, the basic measure is “intramural expenditure”, which includes all
expenditures for R&D performed within a statistical unit or sector of the economy. Both current and
capital expenditures are included. The standard aggregate is the gross domestic expenditure on research
and experimental development (GERD) which is carried out in a country in a specific year. It is
calculated as the sum of intramural expenditures carried out by the four performing sectors, and it is
displayed in the form of a matrix combining both performing and funding sectors.
The Business Enterprise sector is classified according to the International Standard Industrial
Classification (ISIC Rev.3). Detailed information on R&D statistics performed by the business private
sector is reported in the OECD Analytical Business Enterprise R&D database (ANBERD) covering 19
Member countries. As to the Government sector, spending data are collected by national authorities from
the national budgets, by identifying those items involving R&D and measuring or estimating their R&D
content. Data usually refer to the central government only and are collected on a source-basis, rather than
(^9) Current expenditure other than compensation of personnel includes expenditure on contracted and purchased services,
on other resources (teaching and learning material) and required payments other than expenditure on educational
resources.
(^10) It includes spending on construction, renovation and major repair of buildings and new or replacement equipment.
(^11) OECD: “The Measurement of Scientific and Technological Activities: Proposed Standard Practices for Surveys of
Research and Experimental Development – Frascati Manual 1993”, OECD/GD(94)84.