Deakin Communicating Science 2016

EES 200/101

Economics of large experiments part 2: public vs private investment





The long term technological benefit from funding these large experiments is clear from my previous post, but who is funding them? Private or public sector?


In a study done by the Australian government on OECD country private vs public expenditure on R&D, it found that all countries private sectors spend more than the public sector, on average more than double.


However when we look at a list of the 10 most expensive scientific experiments, all of them have been government experiments or funded by the government. (financesonline, 2016)

I believe this trend is due to many reasons. Firstly the upfront cost for these experiments makes it hard for a single company in the private sector to fund it. The most expensive science experiment ever done is the international space station, the total cost of the construction and running has been 160 billion dollars, It would be hard for companies to come up with this budget (washington post, 2014) (nasa, 2016).

Instead Governments have an easier job at this as all the resources are under centralized control, meaning that although total expenditure is less than the private sector, they are still the single largest contributor to R&D, also countries can cooperate together to get this budget. Secondly the lag time before a return on investment is very high. Experiments such as CERN took more than 20 years before results started to come in, whilst it is true that some marketable technologies could be developed before that, the period for a return on investment is still too high. (Cern, 2016) Thirdly the risks involved are too great. Because most of this science is on the forefront of technology, no one really knows what will be developed, for a company which has a very specific range of interest, this is a major problem. An example of this is the World wide web discovery from CERN, if a company was funding CERN  for nuclear research, it would have very limited use for the world wide web, whilst a government has a much large range of interests.




Private companies have occasionally funded research with large costs, but the cost eventually falls on the government, for example through subsidies or buying technologies that are not economical yet. (Dossani, 2009)


So it comes to non-surprise that most of the funding for these experiments comes from the government, which can finance the long project, more happily collaborate with other countries, and benefits from the whole range of discoveries.




Brulle, S. M. (2013, 5 29). Spinning particles and spin-offs. Retrieved 04 15, 2016, from horizon-magazine:

Cern. (2016, 04 15). Retrieved 04 15, 2016, from

Dossani, S. (2009, 02 10). Chomsky: Understanding the Crisis — Markets, the State and Hypocrisy. (N. Chomsky, Interviewer)

financesonline. (2016). 10’s worlds most expensive science experiments. financesonline, 1.

goverment, a. (2001). internatinoal comparison of public and private sector expenditure on R&D. canberra: aph.

nasa. (2016). mission page. Retrieved 5 01, 2016, from nasa:

reuters. (2013, 4 24). UK firm buys cancer-zapping spin-off from CERN collider. Retrieved 4 15, 2016, from

Symmetry Magazine. (2012, 03 16). CERN spin-off: More efficient solar panels. Retrieved 4 15, 2016, from Symmetry Magazine:

washington post. (2014, 1 9). NASA wants to keep the International Space Station going until 2024. Is that a good idea? Retrieved 4 15, 2016, from washington post:








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This entry was posted on April 23, 2016 by in Burwood - Friday 11am, Uncategorized.

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