UNIVERSITY SCIENCE AND SCIENTIFIC RESEARCHES (ECONOMIC ESTIMATIONS AND EFFICIENCY PARAMETERS)

A.I. Stupnitski The professor of “International business” department at Institute of the international affairs Kiev National University of Taras Shevchenko, Ukraine, Kiev

What are the economic estimations and measuring instruments of efficiency of a university science?

What are the characteristics of specific economic parameters of scientific researches and what indicators it is possible to use for their quantitative measurement? Whether the income actually gained from a university science is exposed to calculation? Today, these questions exist and actually, they are not rhetorical, but purely practical as form base for making of budgetary decisions at the state level. Doubts concerning the possibility of definition and quantitative measurement of economic results of scientific researches are a “yesterday” for an economic science of the West; however they still take place in Ukraine that is a display of incompetence of separate civil servants and the administrative structures entrusted to them.
Adherents of “immeasurability of economic benefits” of science, first of all, are frightened of objective difficulties connected with the fact that scientific achievements often arise from a series of research works and decisions, and economic benefit is, as a rule, complex result, and it cannot be calculated as an elaboration in whole. Therefore, such sizes as a cost of separate research works, the net profit from scientific discoveries and other, are hard audible and it is necessary to search for them in bulk of facts and to distinguish in parts. It directly leads to negative recommendations concerning definition of expenses and economic benefits of a science mediocre or from uneconomical signs – such as quantity of publications, number of researchers, lists of the patented discoveries, general expenses incurred on subjects, etc. All this are “echoes” and “fragments” of the socialist approach to efficiency of science, mentality of so-called “general public benefits”.
At present, the estimation of research work is an important element in activity of the scientific organizations. Most widespread way of estimation is based on reviews. National quantitative models of work assessment of the researchers are established in different countries, corresponding to a paradigm of the hierarchical models, including certain set of attributes [1; 2; 3; 4; 5; 6]. Difficulties of recognition and measurement of economic characteristics of a science and actual possibility to make it are two different concepts which cannot be mixed. Without recognition of commensurability, including a quantitative estimation of effects from science use, the scientific approach in sociology of science is impossible, and researches in this sphere are doomed to naked empiricism and the general judgments. Research of the western techniques of estimation and calculations of efficiency of a science gives the chance to assert that the science, in general, has possibility to open the content of the basic economic indicators of scientific researches and results of their implementation, and also to quantitatively measure these indicators [7; 8].
The science which is considered the most in the form of theoretical knowledge and even embodied in technological field (for example, any device for research) does not create real economic benefit. Scientific and technical knowledge in the form of the logical data and technical samples are carriers of exclusively potential economic benefit. Without application they are only non-realized possibilities of production (economic benefit of sale of the scientific information is the separate isolated case of use of a science in production). If we designate a total additional gain from implementation of scientific researches and technical means through E (that includes – as components), and the expense of means on scientific researches and designing – K1, then economic utility (efficiency) of science E ‘ will be expressed in relations between two values:
E= E/K1

And pure e the effect will make a difference between them:
e= E- K1

Namely, an additional gain minus additional expenses of work.
The factor of relation E/K is border which defines quantitatively economic utility of a science in a society. Becomes clear that economic benefit of use of scientific knowledge in manufacture is directly proportional to additional technical effect from implementation of this knowledge both to inversely proportional additional expenditures of labour and expenses which are spent for its acquisition and use. Independent expression can have pure effect from a science. If we designate additional expenses of a labour on acquisition of knowledge and means for their realization as – K1, and an additional gain from their use – e, then pure economic efficiency from science use will refer expression through: e/K1=E1 . Estimation of science as an economic event, scientific researches as a production process, scientific knowledge as a scientific product and their use in manufacture field provides the analysis of specific economic characteristics of a science.

Expected economic benefit (M) justifies additional expenses of works and means from the socioeconomic point of view. It serves also as real criterion of an economic estimation. At each choice of an industrial-research subject, by working out of variants taking into account the size K1, and in general at an estimation of parameters of research problems it is necessary to start with necessarily positions that M> K1. The satisfaction of the requirements put in this inequality, justifies carrying out of these or those research-and-production works. In other case of the use of a science would reduce productivity and would increase work over-expenditures.
Cost of scientific production cannot be criterion for determination of its price, as it includes all expenses K1 (including expenses on unsuccessful research works) and consequently on itself it does not define value of consumer suitability of the results received from use of scientific achievements. The considerable part can be unjustified, and rather small part can give good results inappropriate to expenses. Cost of scientific knowledge is always individual (as scientific product is unique), it does not develop into public cost and cannot turn in average public cost at all. At sale consumer cost of a product of scientific work is not alienated, and at consumption is not destroyed. Cost of scientific products is not a multiple of their quantity. Cost of the scientific information is not characterised by expenses of public work at first, which should be expressed in the price. Cost of the goods – “scientific production” has non-commodity character and cannot be a base for price definition. Income or pure economic benefit of use of the scientific and technical information can become such base.
The price of a scientific product should be considered as the capital, which earns income equal to economic benefit of a science (E). The standard of a gain existing at present can serve as a base for profitableness, and the gain of the capital invested in the industry, loan percent of the credit or percent of an annual gain of the national income can be used as the standard (standard profitability). If, for example, E = 20, the norm of a gain accepted as the standard, makes 5/100 (5 %) the price will be equal 400 (20:). It is obvious that economic benefit of a science will be presented as percent from the capital or as percent from the sum equal to the price. The price of scientific production should be considered as the capitalised pure economic benefit of industrial use of scientific works and calculated by the formula:
(20:5/100)
It is obvious that economic benefit of a science will be presented as percent from the capital or as percent from the sum equal to the price. The price of scientific production should be considered as the capitalised pure economic benefit of industrial use of scientific works and calculated by the formula:

P= effect/ gains tan dart
By means of this formula it is possible to estimate and establish differential incomes of practical use of scientific knowledge, formulations, methods, designs, formulas, drawings, models and other theoretical and scientific and technical decisions. Means for scientific production received accordingly to its price are compensated in the course of use of the information from additional income which has been realised. The size of the price of the scientific information is in functional dependence on the proved economic benefit. In this case a difference of price P compared with K1 is more than obvious: if K1 is not always proportional to E (any economic benefit of a science more or less is result of K1, but it is not obligatory that K1 has economic benefit as a result), the price of the scientific information is proportional to the economic benefit put in it and is measured together with effect. The more the proved economic benefit is, the higher is the price, and on the contrary. The exact line across which the concrete level of the price passes depends on the norm of growth accepted as the standard. The price can cover, and cannot cover production costs of K1. At coincidence of expected effect with realised one and in the case when investments calculated on the basis of the capitalised effect, price P and expense K1 will coincide. At unfavourable researches we will receive K1> P, and at unexpected success – P> K1, i.e. instead of over-expenditures there will be an additional income.
The price of scientific production is a border within the limits of which the expense on scientific researches is considered expedient for the researcher. Behind this border (K1) superfluous expenses of means of the investor appear. The price of the scientific information defines optimum border K1. Change of this level for the investor is equivalent either to the additional income or the over-expenditure of means. Expenses on a science are considered recognized if at use of research results and by these means provide additional income at existing standards of a gain.

The price of the effective scientific decision increases without individual expenses K1. It has exclusively great value for increase of profitability of the research organisations and their interest in growth of efficiency of scientific search (instead of quantities of the spent funds). In this connection the high price of scientific research can be realised at absence expenditures. So, by means of the capitalised effect from a science it is possible to measure and estimate not only the scientific products, the ready scientific and technical information, but also the expense on scientific researches at all stages, especially in their planning and a substantiation period.
By analogy with industrial researches non-productive research works can be estimated. Practically this is done by using conversion factor and transformation of different technical, technological, economic and other socially useful effects from use of achievements of a science in economic benefit. The estimation of the scientific information gives an opportunity to carry out rather exact calculations in the process of selecting variants of different scientific and technical decisions, various volumes of research expenses or the variants connected with acquisition of licences and conducting of own research works for achievement of the same purpose.
Licence practice can offer much for an explanation of structure of the price of scientific production, as this form of pricing is shown in the most direct economic form. Some problems which are not openly revealed in other fields, are explained in this field. For example, arises the possibility of realizing the price of the scientific and technical information by the same way as in case of land selling, (i.e. to conditions of its use) and practically irrespective of whether income received will be connected with actually realised effect from a science. In this case economic benefit is appropriated in “advance payment”. From this point of view the price of scientific knowledge and decisions can be defined as the income which is realised in “advance payment”.
So, the price of research production has the ability to be shown not only as directly once and for all set and fixed sum, but also as mobile and elastic size which reacts to changes of influences of factors of acquisition of the income from implementation of results of scientific researches and designing. Irrespective of modifications in economic benefits of a science, having of own industrial, i.e. real economic and natural equivalents is essential.
If for a customer as an owner of some scientific product the moment of distribution of the income is not important (he can repeatedly sell the right of product use), such possibility does not exist for the executor and he aspires to economically realise the participation in research at distribution of the income of implementation of scientific effect. Under such conditions price P will be formed on the basis of two components: P=K1+e1, i.e. costs of research plus a part of economic benefit that is due to researchers. Practically, the extra charge e1 is established on the basis of certain standard percent of profitableness of research works.
The price of scientific researches economically regulates financial relations between the customer and manufacturers of research works; and it, by the way, acts as criterion for definition of the size of funds which are the most favourable to invest in this or that scientific research or service. Unlike funds for research, expenses for implementation of scientific researches (K2) initially have directly industrial character. Introduction is directly industrial activity which leads to realisation of primary gain M. Therefore introduction and development of scientific knowledge appear in cumulative cost of works as expenses, and as primary gain: CT=C+V+M or CT=K2+M.
The share of the differential income which belongs K2, responds basically to relative density of introduction in the general complex of research and industrial activity which influences a gain of productivity and economy of working hours. Economic mode K2 defines circulation of corresponding expenses. An investment in works and introduction are included in structure of the cost price of products and are compensated through realisation of the price of production. Extra charges after the restoration moment are reciprocal expression of a gain – the income from profit and additional economy of working hours (the differential income). Expenses K2 are formed and turn around similarly to additional investment. Process of scientific and technical changes is necessary to consider as a result of association and mutual influence of some consistently connected factors:
Expenses on research;
· Expenses on introduction and development of scientific achievements;
· Productivity gain;
· Changes in process of creation of cost;
· Creation of the basic and additional income.
Their communication and interaction can be presented in the form of uniform system with following elements:
The invested funds are distributed depending on their functions in manufacturing and at gain occurrence:
K – Primary investments;
K1 – Additional investments in scientific researches;
K2 – Additional expenses on introduction of scientific works.
The result finds the expression in specific changes in manufacture from introduction of achievements of a science – in growth of productivity and change of structure of cost of a product. Expenses K1 and K2 raise individual cost of production and its volume. The general result consists of decrease in individual cost of a unit of production. The difference turns to the additional income. The price of a unit of production does not change.
Thus, the productivity increase is compensated by a gain of investments in scientific researches, elaborations and their introduction. The sum of price reduction exceeds the sum of price increase. The main requirement of occurrence of economic benefit of a science is observed: individual cost decreases and becomes lower, than the price. It is accomplished through internal mechanism of structure change of cost: production cost price increases as a whole and the cost price of units of its components decreases. The difference depends on multidirectional effect from use of the scientific information – growth of expenses on manufacture of all production at advancing growth of productivity of its separate components. Additional expenses are distributed on greater number of units of production; therefore smaller expenses are necessary on each unit of production. So, introduction of achievements of a science in production is socially defensible. Provided that the gain from a science is proportional to the executed additional investments, its size can make to 50 % from the general gain. Expenses K1 lead to a rise in price of individual cost of production, but nevertheless reduce the price of a unit of production, i.e., the difference is positive.
Economic benefit from introduction of scientific achievements is calculated in its pure form. The individual effect in this case is presented by economy made on a unit of production, and the aggregate effect equals to all sum of an additional gain; from total sum of a cost not only the sum of additional investments of researches and introduction, but also standard income M is deducted as it is not additional, but the primary income. The pure additional income appears as a result of investments K1 (or qualities of a science to stimulate gain occurrence, i.e. it is understood that K2 takes part in creation of only primary gain M). It means that a science, creating conditions for labour productivity increase in manufacture, becomes a source of an additional gain, and it creates conditions for its self-support even during production.
On the basis of the received primary results the different calculations connected with economic benefit of a science can be carried out. Relation E:K1 enables to calculate effectiveness ratio of investments in a science. Converse relation K1:E is an indicator of restoration of means for the corresponding period of time or factor of a recoupment on the basis of receipts from all income. The separate percent expresses that part of the period of creation of effect in which the funds invested in scientific work are restored. The pure additional income e is deduced on the basis of a difference between total effect and expenses (E-K1). On this base, degree of net gain K1 (e:K1) is calculated that is a percent of profitability of investments in research works. Converse relation K1:e is an indicator of the period of a recoupment on the basis of only net gain e.
Thus, there are two concepts of economic efficiency of scientific researches and investments: degree of the general growth and degree of net growth K1. The first means the general economic efficiency, and the second – profitability of investments in research works.
In a new production the additional income of research works is realised in consumption phases/points. K1 appears already in the form of K2 and turns around under turnover laws of K2. Economic benefit of a science arises in the form of additional economy and the differentiated income. The advance in price of production that the manufacturer has to cope with is compensated by reduction of production price at the enterprises which consumes it. Along with it comparison of E with K2 should reflect a positive difference. The additional effect remains at the consumer of scientific objects. With its help the price of the scientific information or services (K1) is compensated, and the rest appears as net effect.
If K1 is restored from receipts E then the term of recoupment of T will be defined on the basis of the relation between expenses and receipts: Expenses on research;
· Expenses on introduction and development of scientific achievements;
· Productivity gain;
· Changes in process of creation of cost;
· Creation of the basic and additional income.
Their communication and interaction can be presented in the form of uniform system with following elements:
The invested funds are distributed depending on their functions in manufacturing and at gain occurrence:
K – Primary investments;
K1 – Additional investments in scientific researches;
K2 – Additional expenses on introduction of scientific works.
The result finds the expression in specific changes in manufacture from introduction of achievements of a science – in growth of productivity and change of structure of cost of a product. Expenses K1 and K2 raise individual cost of production and its volume. The general result consists of decrease in individual cost of a unit of production. The difference turns to the additional income. The price of a unit of production does not change.
Thus, the productivity increase is compensated by a gain of investments in scientific researches, elaborations and their introduction. The sum of price reduction exceeds the sum of price increase. The main requirement of occurrence of economic benefit of a science is observed: individual cost decreases and becomes lower, than the price. It is accomplished through internal mechanism of structure change of cost: production cost price increases as a whole and the cost price of units of its components decreases. The difference depends on multidirectional effect from use of the scientific information – growth of expenses on manufacture of all production at advancing growth of productivity of its separate components. Additional expenses are distributed on greater number of units of production; therefore smaller expenses are necessary on each unit of production. So, introduction of achievements of a science in production is socially defensible. Provided that the gain from a science is proportional to the executed additional investments, its size can make to 50 % from the general gain. Expenses K1 lead to a rise in price of individual cost of production, but nevertheless reduce the price of a unit of production, i.e., the difference is positive.
Economic benefit from introduction of scientific achievements is calculated in its pure form. The individual effect in this case is presented by economy made on a unit of production, and the aggregate effect equals to all sum of an additional gain; from total sum of a cost not only the sum of additional investments of researches and introduction, but also standard income M is deducted as it is not additional, but the primary income. The pure additional income appears as a result of investments K1 (or qualities of a science to stimulate gain occurrence, i.e. it is understood that K2 takes part in creation of only primary gain M). It means that a science, creating conditions for labour productivity increase in manufacture, becomes a source of an additional gain, and it creates conditions for its self-support even during production.
On the basis of the received primary results the different calculations connected with economic benefit of a science can be carried out. Relation E:K1 enables to calculate effectiveness ratio of investments in a science. Converse relation K1:E is an indicator of restoration of means for the corresponding period of time or factor of a recoupment on the basis of receipts from all income. The separate percent expresses that part of the period of creation of effect in which the funds invested in scientific work are restored. The pure additional income e is deduced on the basis of a difference between total effect and expenses (E-K1). On this base, degree of net gain K1 (e:K1) is calculated that is a percent of profitability of investments in research works. Converse relation K1:e is an indicator of the period of a recoupment on the basis of only net gain e.
Thus, there are two concepts of economic efficiency of scientific researches and investments: degree of the general growth and degree of net growth K1. The first means the general economic efficiency, and the second – profitability of investments in research works.
In a new production the additional income of research works is realised in consumption phases/points. K1 appears already in the form of K2 and turns around under turnover laws of K2. Economic benefit of a science arises in the form of additional economy and the differentiated income. The advance in price of production that the manufacturer has to cope with is compensated by reduction of production price at the enterprises which consumes it. Along with it comparison of E with K2 should reflect a positive difference. The additional effect remains at the consumer of scientific objects. With its help the price of the scientific information or services (K1) is compensated, and the rest appears as net effect.
If K1 is restored from receipts E then the term of recoupment of T will be defined on the basis of the relation between expenses and receipts:

K2 Has other character and passes other technological way. Its function consists in mediating introduction of scientific researches in production and to have directly industrial character, i.e. is included in cost and in the price. From the point of view of a turnover, activity on introduction should be reduced to reproduction of a fixed capital with expansion elements, or to work on intensive expansion of manufacture. K2 turns as direct production costs. K2 unlike K1 is compensated both at the expense of the standard income (p), and at the expense of depreciation charges and receipts from the additional income. K2 can be restored through deductions from the price, in which calculated cost of the operational expenditure, amortisation, and also the standard and additional income. Size T will have the following appearance:

e1 – A part of net effect which is appropriated by the one who introduces science achievement.

For both sizes (K1 and K2) T will be defined under the following formula:

In case of manufacturing new type of production when expenses on introduction are invested at a stage of manufacturing preparations and expenses of means K2 is a part of the advanced means (K), K2 turns as K·K1 and in a turn appear in the same kind, as K. In practice expenses on implementation of scientific researches renew through the mechanism which it is possible to be named as “advance amortisation”.
On the basis of basic positions it is possible to classify economic benefits of a science taking into account their concrete features and displays in practice. Different kinds and versions of economic benefit differ depending on the enterprise, a field of activity and economy as a whole. The special forms often made of contradictions get effect at “economic personification” of participants in system”research – working out – manufacture – consumption”. Concrete versions of economic benefit of a science are defined by factors which influence its creation and distribution, features of manufacture and consumption of knowledge, a kind of economic subjects, time and spatial borders of gaining income. If the effect is realised directly after research it is perceived as “advance” effect.
Introduction of achievements of a science can occur at one enterprise, and the effect to be realised at other enterprise which consumes this specific product. In general, economic benefits of a science can be shown on different remoteness from the centre of research both in time, and in a place, and to give different representation about the parameters.
Depending on a concrete situation economic benefit of a science can be shown in following versions:
· Direct and indirect economic benefit;
· The proved and probable economic benefit;
· Real and potential economic benefit;
· Single and complex economic benefit;
· Partial and total economic benefit;
· The general and differentiated economic benefit;
· Direct and compensatory economic benefit;
· Primary and secondary economic benefit;
· The expected (settlement) and received economic benefit.
Without the device of the differentiated indicators it is impossible to capture, estimate and socially justify economic benefit of a science in the general complex of research works at stages of a formulation of a subject and research, and also at a stage of application of scientific results. At the first stage economic benefit is only calculated as technical and economic benefit, on the second – realised technically, but still potential economic benefit, and at the third stage – actually received economic benefit. Without the differentiated estimation the first and second stages will look superfluous or socially unjustified (as do not give immediate economic benefit) and in this connection – deprived of a financial substantiation [9; 10]. Direct economic benefit is quite narrow measure of estimation. On the one hand, it can capture, for example, socially proved, but, mainly, insufficiently considerable designations (on technical realisation) separate improvements which, however, give immediate economic benefit. On the other hand, system long-term and more expensive research works on powerful scientific and technical subjects, according to such estimation, look economically inefficient, and fundamental research in general seems unprofitable. In this connection, erroneous conclusions can be avoided, using the account of the potential economic benefit put in achievements of general-theoretical scientific researches.
By means of the differentiated estimation opening and quantitative definition of the whole groups of the effects connected with public structure of manufacture becomes possible. So, for example, the individual effect from the research or industrial enterprises can be defined and considered economically as direct effect, and public effect which contains complicated elements of distribution and redistribution, – as indirect economic benefit of a science. Thus, the detailed economic estimation of all displays of economic efficiency of a science both in separate concrete areas, and in economy as a whole is possible.
The most part of the listed versions of effects is reduced to nuances of direct and indirect effect. The effect of element mediation amplifies especially, then further we keep away from research and manufacture and the nearer we come to field of consumption and to non-productive sphere. This circumstance is also traced at transition from direct use of scientific works to basic researches (technical elaborations realise almost direct effect while behind fundamental elaborations indirect effect is not even admitted). There is variety of degrees of indirect effect. Sometimes the chain between research and its economic benefit (for example is absolutely lost, at research which has reflexion in the scientific article). However, despite the resulted difficulties, indirect economic benefit of a science exists, and it can be established quantitatively, even empirically.

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