Scale and Scope in Research

Abstract

The issue of economies of scale and scope in research is arguably as old as research itself. Recently, however, deep changes in the way we organize research and an improved understanding of the relationship between research and growth have rekindled interest in the subject. A case in point is the concept of the European Research Area (ERA), which appears to be founded on the implicit understanding that economies of scale and scope matter in research funding and execution and that coordination and collaboration (at various levels) are therefore beneficial, whereas fragmentation and dispersal are inefficient. Hence the emphasis on ‘critical mass’. The rest of the chapter is divided into the following sections. Section 1 defines scale and scope economies in research and identifies reasons why empirical verification of such effects may be fraught with difficulties. Section 2 traces the extensive literature on the neo-Schumpeterian hypotheses that laid the foundation for the modern discussion on scale and scope effects in research. Section 3 introduces cooperative research as a reaction to a perceived need for correcting market failure and the inadequacies of individual organizations to go it alone. The section also describes how assumptions of research cooperation are built on the concepts of economies of scale and scope. Finally, Section 4 concludes by relating the discussion on scale and scope, and the related need for government intervention, to the evolution of the European Framework Programmes for Research and the development of the ERA.

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