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Austria's Technology Flows


  • Gernot Hutschenreiter


  • Serguei Kaniovski


The OECD has been measuring the total research and development content of output flows for several years. This measure not only includes direct R&D expenditures, but also the research and development content of intermediate and investment goods, both domestic and imported. In many cases, this presents a more meaningful approach to measuring technology levels. For the first time, computations of the total research and development content of output were carried out for the Austrian economy. The results are presented in this study. In Austria, direct expenditures on research and development in the business sector account for not quite half of the total research and development content of aggregate output. The most important components in the "indirect R&D" category are imported and domestic intermediate goods. In the longer run, the share of imported technology in the total R&D content of output is increasing. Although initially Austria was able to catch up (from 1976 to 1988), research and development expenditures were still low by international standards in 1994. With a ratio of "indirect" to "direct" research and development expenditures close to 1 : 1, Austria holds a middle position in the international community. In large, advanced economies this ratio is significantly lower. For a small open economy technology flows embodied in imports are particularly relevant. As expected, the ratio of imported intermediate and capital goods to direct expenditures on research and development is relatively high by international standards. However, the same holds true for comparable small open economies. Thus, there is no evidence that Austria holds an extraordinary position based on above-average imports of technology. Germany plays a remarkable role as a supplier of imported technology to Austria. Germany dominates technology imports – in particular through investment goods – to an even higher degree than Austria's imports of manufacturing goods. The USA is the second most important partner country in this respect (apart from the "other OECD" group of countries including Switzerland). The change in the pattern of technology flows over the two decades examined provides an impressive picture of Austria's evolution towards a "knowledge-based economy". On the one hand, the service sector has gained significantly in importance as a destination of technology flows, catching up with manufacturing by 1994. On the other hand, the weight of the information technology cluster has been increasing rapidly: Already in 1994, the information technology cluster was by far the most important source of technology, outweighing the materials cluster. Thus, the relations prevailing in 1976 have been almost completely reversed. Indirect research and development originating in the information technology cluster and absorbed by the service sector constitutes the most important flow of technology. Even for the manufacturing sector, the information technology cluster was the most important source of technology in 1994, thus outperforming the materials cluster. Here, too, the relations have undergone a fundamental change since 1976.

Suggested Citation

  • Gernot Hutschenreiter & Serguei Kaniovski, 1999. "Austria's Technology Flows," WIFO Monatsberichte (monthly reports), WIFO, vol. 72(6), pages 419-433, June.
  • Handle: RePEc:wfo:monber:y:1999:i:6:p:419-433

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    References listed on IDEAS

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