THE PLANNING OF ENERGY R AND D

In addition to its basis in energy policy, the Soviet energy R and D program also flows out of the general process of planning R and D in the Soviet economy.* The Soviet approach to R and D planning involves a mixture of direction from above and initiative from below. The top-down function is in the hands of the State Committee for Science and Technology, the Academy of Sciences, and Gosplan, which are responsible for establishing a set of mission-oriented research programs. In the words of one source: “In the section of the National Economic Plan ‘Planning the Basic Scientific-Technical Problems’, already at the stage of establishing the basic direction of the development of science and technology for the Five Year Plan, the GKNT [State Committee for Science and Technology] together with the Gosplan USSR and ANSSSR [Academy of Sciences of the USSR] sets up a list of basic scientific-technical problems. At the same time the ministries and departments responsible for solving each problem are designated. That list as a rule includes the most important problems of an interbranch character” (Oznobin, 1975, p. 197). For each of these problems, the most important associated tasks (zadaniia) are established, and it is these tasks that are actually specified in the Five Year Plan document in the form of particular machines and systems of machines to be created and mastered, technological processes to be created and mastered, and improvement of methods of planning, organization and administration of production (Gosplan SSSR, 1974, p. 11). The construction of a list of problems seems to be part of the Five Year Plan process, while the translation into “tasks” takes place both in the Five Year Plans and in the annual plans. This system of designating the problems apparently began with the 8th Five Year Plan, 1966–1970 (Ekonomicheskaia Gazeta, 1976:35, p. 8).

The problems are supposed to be grounded in forecasts of technological potentials and economic needs, which GKNT is also charged with organizing. What such forecasts look like can be judged from an exceptionally informative book, Osnovnye napravleniia nauchno-teknicheskogo progressa (Moscow, 1971), edited by A.S. Tolkachev and I.M. Denisenko and produced by the Scientific Research Institute for Economics under Gosplan. For energy, this book contains a 14-page chapter outlining a number of energy policy objectives and discussing particular technological means for attaining them—such as the use of small diameter and diamond bits to raise drilling speeds and the creation of larger boiler-turbine-generator sets to cut labor expenditure rates.

Some of the problems may be capable of solution within an individual ministry, but most of them are “complex” in the sense that they involve cooperation among a large number of research and production institutions in several ministries. Complex problems are taken care of by “coordination plans,” for the working out of which the State Committee is responsible. In an analysis of the 246 complex problems that were established for the 8th Five Year Plan, we find such energy R and D examples as “creation of the production engineering and production of equipment for liquifying natural gas” and “creation of equipment for high speed drilling of deep and superdeep oil and gas wells” (Kosov and Popov, 1972). The “coordination plans” are apparently not part of the official state plan; rather their function is to see that the various tasks (zadaniia) that are part of the plan form a coordinated solution in each problem area.

This system was changed somewhat for the 10th Five Year Plan (1976–1980) with the substitution of “programs” for the coordination plans. This is supposed to be more than a mere shift in terminology in the sense that the “programs” are to be more explicitly focussed on end results such as the creation of a prototype, construction of a pilot plant, series production, or commissioning of a commercial production facility embodying the new technology (Ekonomicheskaia Gazeta, 1976: 35, p· 8).

The list of problems or programs includes basic research as well as applied problems. The “problem” view is characteristically mission-oriented but envisages as a distinct mission the creation of a backlog (zadel) of new knowledge that can be used in a future period as the basis for new applied missions or new solutions to existing problems.

The set of mission-oriented tasks we have been describing covers only part of all Soviet R and D—the coordination plans accounted for only 40 percent of total R and D expenditure in the 8th Five Year Plan, for example. The remainder of the national R and D effort consists largely of projects that originate at lower levels, some of which may be very substantial and important, but which are directed toward branch or local problems and require less elaborate interdepartmental cooperation.

This Soviet approach to planning energy R and D shows some similarities with ERDA’s planning of U.S. energy R and D (as described in ERDA, 1976). In both cases there is a split between expensive, long-range, uncertain projects larger than can be handled by the resources of individual organizations and smaller, more routine, less risky kinds of work. In the U.S. case, this corresponds in general to a public initiative/private initiative split. The ERDA approach envisages that much of the energy R and D needed to solve energy problems will be conducted by private firms from their own funds and that its own responsibility is to see that long-range, risky efforts that are socially justified but would not pass the test of private profit are not overlooked. In the USSR it is also expected that much research and innovation can be left to the departmental level and that high-level attention should be reserved primarily for novel technologies with long lead times, high-risk effects, or input requirements that go well beyond what individual organizations can handle. I have found no clues as to what share of the total energy R and D program is covered by the “coordination plans,” but it would not be surprising to find that, as in R and D as a whole, half or more is determined at lower levels.

As with energy policy generally, the Soviet planning hierarchy seems to lack a node that looks at the energy R and D program as a whole and as its major responsibility in the way ERDA does. Judging from the institutional provenance of the Soviet forecasts we see, much of the initiative comes from the ministries.* There is no energy section as such in GKNT. There is a department of electric power and electric equipment (otdel energetiki i elektrotekhniki) and departments for machine building and transport, but none for energy in general. What GKNT does have apparently are ad hoc councils for each interbranch development problem. The interbranch problems in basic research have comparable councils under ANSSSR. These councils pull together specialists in the given area from many different institutions to act as an expert evaluative and policy body for that problem. Most of the literature suggests that the R and D plan for energy is worked out by a process of negotiation among all these groups, presumably with the Gosplan and GKNT having the last word.

MODELING AT LOWER LEVELS

One way to summarize what has already been said is that the R and D desiderata emerging from overall energy policy and the R and D planning process come together at the next level below the central planning bodies in the hierarchical structure in a set of R and D tasks formulated largely in terms of ministerial or broad technology-area clusters. For Minugol’, the implication of the “develop eastern coal” strategy is that it must concern itself with technological improvements in stripmining that coal. That goal also implies for Minenergo that it must deal with a complex of problems associated with utilizing that coal in mine-mouth plants and transmitting the power to markets.

The responsibility at this level, however, is not only to translate the rather grossly expressed technological objectives chosen at the center into more fully specified R and D programs and projects, but also to repeat the whole process of establishing a strategic framework of policy goals and shaping R and D inputs to achieve these goals. The ministry has a large agenda of technological tasks growing out of its own operational concerns. The job of the ministry R and D planners is thus to organize and allocate the R and D resources under the ministry’s control into an integrated program that supports both agendas.

As this disaggregation proceeds still further and as the R and D process unfolds over time, there is obviously an ever increasing problem of balancing the need to keep R and D efforts focused on the attainment of ministerial goals and the need to change these priorities and evaluations as the higher level considerations from which they stem are increasingly modified. Decisions as to the relative priority to give Siberian coal versus Siberian gas in meeting European energy needs must be kept consistent with the technological prospects and research priorities on long distance power transmission versus improvements in pipeline technology. And if the interfuel competition turns out to favor sequential development of the alternatives, the basic versus applied balance within each area must be correspondingly adjusted. For example, judgment that development of long distance power transmission technology will not reach fruition in time to permit reliance on Siberian coal in meeting near-term needs should both induce a heavy quick-fix effort for improving pipeline technology for the enhanced near-term role for gas and a corresponding bias in transmission R and D toward seeking fundamental breakthroughs by means of basic research (on cryogenic approaches, say) rather than a brute force attack on refining traditional approaches.

Strategic R and D goals become widely spread throughout the system as they are translated into R and D programs. Minugol’ is instructed to create the technology for efficient open-pit mining of Kansk-Achinsk coal; Minenergo is assigned the task of creating new boilers to burn it and coal processing equipment to upgrade it to a transportable fuel. Others are charged with developing a way to haul it. Within each of these hierarchies, these tasks are further broken down and assigned to R and D organizations. But as this disaggregation takes place and as the R and D work moves forward at the level of the performers, someone needs to stand above the process, repeating that the various subtechnologies—for burning the Kansk-Achinsk coal in boilers, the energy-technological processing technology, and slurry pipelines— are not independent, but have strong complementary or competing relationships and should be designed, evaluated, and developed in that light as well as in their role as means toward ministerial objectives. This is partly a ministerial job, but its interbranch aspects fall on GKNT. Without trying to illustrate with energy R and D specifically, we can say that the State Committee’s capacity to carry out this coordination function is seen by Soviet commentators as greatly overburdened by the complexity of the task (Sominskii and Bliakhman, 1972, pp. 8–10).

As the process moves down the hierarchy, the modeling of energy choices becomes more concerned with making operational decisions rather than forecasts and plans, more constricted with respect to technological alternatives, more short-term than long-term, more localized. R and D planning turns into R and D management and becomes ever more intertwined with decisions about current production, investment, operations. But even if those decisions cease to look so much like R and D decisions, they still have an important influence on the sector’s performance in innovation and R and D effectiveness. R and D effectiveness is determined not only by what scientific breakthroughs are made and how good the design decisions based on them are, but also on what the producers, the investment decision makers, and the operators do about producing and using the new equipment and ideas.

One of the most important stages in the whole decision-making process is what the Soviet planners call project making, a process in which investment planners make decisions about technologies to be used in some project. At this level there is a great variety of models for decision making, many of them rather standard and mostly what would be called in the United States cost-effectiveness calculations. For example, investment projects are usually evaluated by standard projectmaking procedures using the pay-out period calculation. As an illustrative case, some higher level organization may define a need to move a proposed volume of oil from Tiumen’ to the center, and a projectmaking organization chooses such variables as pipe diameter, pumping equipment types, and capacities by trading off reductions in operating cost versus the associated capital increments. These design calculations often go far beyond simple one-facility cases and are handled on a branch basis. For example, the gas industry planners try to optimize not only individual pipeline designs, but the design of a whole network, over time, including such aspects of its design as the sequence of constructing alternative routes and the timing of introduction of compressor capacity to arrive at design capacity, by use of dynamic programming models. There are similar models for calculating the effectiveness of proposed new technologies. Much of what the energy planners do follows standard Soviet practice and shares the peculiarities of all such decision making throughout the Soviet economy. The greatest weaknesses in this area probably lie in the limited number of variants usually scanned, and the misleading nature of prices. One of the currently popular themes in Soviet discussions of this modeling is the desirability of using the “systems approach,” which tries to avoid the errors of suboptimization by absorbing the interactions of a number of separate issues into a single modeling process. An illustration would be a model that sought to optimize the development of the nuclear power sector as a whole—including competing technologies, the external fuel cycle, etc.—all in one model, rather than a model that simply chose between two thermal-neutron technologies on the basis of cost. But I suspect that despite much lip service being paid to this ideal, an integrated systems approach is not widely used in practice.

Finally, as we shall see in examining the progress of specific technological areas, one of the most powerful influences on R and D outcomes is the decision-making behavior of the producers who are supposed to embody new technology in equipment. It often happens that even when technological improvements have been translated into new designs, brought to the working stage in the form of prototypes, and tested in industrial application, their introduction is frustrated by the peculiar incentive system that inclines the producers away from novelty and from production assignments that are sidelines to their principal specialization.

In short, though one may think of R and D primarily as being influenced by the budgets, goals, and behavior of R and D organizations, he soon finds that R and D, its translation into new and improved technologies, and its introduction into the economy is less a product of the R and D institutions themselves than of the overall setting within which they work and of a complex set of decisions only part of which ostensibly concern R and D. Still, the organs primarily charged with initiating the creation of new technologies are the R and D establishment, and it is to a description of this establishment that we now turn.

THE RESEARCH AND
DEVELOPMENT ESTABLISHMENT

Careful search of Soviet literature reveals a great deal of information on the R and D organizations in the energy field. I have compiled what I believe is a quite complete inventory of these organizations, including a great deal of information about their activities, employment, and expenditures. That inventory is too cumbersome to be presented here, but on the basis of that inventory the remainder of this chapter attempts to—

summarize some general features of Soviet R and D important in understanding energy R and D; provide a summary description of the major elements in the energy R and D network and present estimates of their expenditures;

compare the results with U.S. expenditures on energy R and D.

Institutional Description and Concepts.

In the USSR, R and D has traditionally been performed in specialized institutes located at a fairly high level in the administrative hierarchy and somewhat divorced from the enterprises that produce new equipment or utilize new technology. In general, these institutes fit into three main networks.

(1) The most distinctive units of the system, the institutes under the various Academies of Science, represent the highest level of prestige in the system and are supposed to specialize in basic theoretical work. The Academy system includes, in addition to the Academy of Sciences of the USSR, Academies of Science in each of the 14 Union Republics other than the RSFSR. Before 1963, the Academy system also did a great deal of production-oriented research and development, but a reform in that year moved many of the applied research institutes, including a number important in the energy field, out of the Academies into the branch ministries.

(2) Branch institutes tend to have a much more mission-oriented approach than Academy institutes, with responsibility for doing the research and development work needed to meet the technological challenges involved in the development of the branch. But some of these branch institutes are very large organizations, and can devote much of their effort to quite basic research at the frontiers of science and technology. Examples are some of the nuclear power institutes under the State Committee for the Utilization of Atomic Energy, or the Electric Power Institute (ENIN) of Minenergo.

(3) Educational institutions play a much less significant role in the R and D system of the Soviet Union than in the United States, though in recent years it has been an important objective of science policy to strengthen the R and D efforts of educational institutions. Under this policy educational institutions have been given a dual role—they are expected both to improve their theoretical work and to work closely with industrial sponsors in performing industrial problem-solving research through contracts or in industry-sponsored labs. Educational establishments do make a significant contribution to energy R and D.

One encounters a great many difficulties of interpretation in utilizing the available information on Soviet energy R and D expenditures and employment, and it seems only honest to describe how these problems have been handled; others may then be better able to judge the comparability of the Soviet figures presented with U.S. concepts in meaning and coverage. The ambiguities encountered also raise questions that need further study in our effort to understand the meaning and coverage of Soviet aggregate data on R and D.*

First, a significant volume of what seems clearly to be R and D takes place in organizations whose relationship to standard Soviet definitions of R and D expenditures and employment is unclear. Energy R and D involves significant pilot or demonstration projects (opytno-promyshlennye ustanovki) such as the U-25 MHD facility, a prototype combined-cycle unit installed in an operating power station, or the pilot installations for energy-technological processing of coal. The operation of these would seem to be R and D and their original cost would be investment in R and D. As one applies the standard Soviet definitions, however, it is not clear that their personnel would be treated as employed in “science,” their outlays as expenditures on science, or their capital cost as R and D investment. These could be significant omissions—it is said that the U-25 MHD test plant cost over too million rubles to build (Electronics World, 15 August 1973, p. 25). In studying energy technology I have been impressed with the importance of the pusko-naladochnye (start-up and trouble-shooting) offices charged with getting a new installation (such as a nuclear reactor) to function. The evidence suggests that their work is not considered R and D, but since what they are usually doing is remedying technological faults in incompletely developed equipment, perhaps it should be.

In the standard Soviet descriptions of R and D concepts, institutions engaged in proektirovanie (project making) are not generally considered to be engaged in R and D. Many of these project-making institutions, however, include scientific research divisions and in general do a lot of work that would seem at least superficially to be R and D. Teploenergoproekt (one of the project-making organs in Minenergo), for example, has its own scientific research institute (NII) and also has responsibility for the design of new nuclear power plants. In Soviet conditions, the latter involves much more than routine design of a station for which equipment is available and all the technological problems are already settled.

Many organizations have names that indicate responsibilities for project making along with responsibilities for R and D. The network of regional organizations in the oil and gas industries, for example, go under the name of NIPI, (nauchno-issledovatel’skii i proektnyi institut—research and project-making institute). I believe these organizations do have responsibility for the main projectmaking function in oil and gas production—i.e., working out the technological scheme and actual engineering decisions for producing an oil field. (Whether they produce the working documents for construction of the above-ground facilities at the field is not clear.)

The word proektnyi is used not only to cover the architectural and engineering work on construction projects, but also to mean the design of equipment or of processes. In this sense, it does not differ greatly from what is meant by konstruktorskaia rabota (design work) as in the design of a new boiler, an offshore drilling rig, or the circulation pump for a nuclear power plant. In general, the Russians consider this kind of work development, and I treat as R and D organizations many that have the proektnyi element in their name—NIPI, NIPTI (nauchno-issledovatel’skie i proektno-tekhnologicheskie instituty), and PKO (proektno-konstruktorskie organizatsii).

My working hypothesis is that, despite the amalgamation of several functions in an institution, the system often manages to maintain the distinction between R and D and other kinds of activity by the internal structuring of the organization or by separate reporting. Thus I assume that, when it is reported that there are a certain number of persons engaged in “science” in some ministry, these would include the personnel of distinct R and D organizations within big projectmaking organizations. Similarly, when some organization is said to have spent some given amount for NIR and OKR,* I assume that some attempt has been made to make these numbers conform to the standard concepts of the Central Statistical Administration.

Work on development of new technology performed in production enterprises is not, in general, captured in Soviet statistics or in my inventory. There is a large number of these organizations in the Soviet economy, as indicated by a summary in the Ukrainian handbook for 1974 (TSSU UkrSSR, Narodnoe khoziaistvo Ukrainskoi SSR, 1974, p. 90). It shows, for example, in addition to labs and experimental bases, 151 konstruktorskie organizatsii that were integral or semi-independent units in industrial enterprises of the electric power and fuel sector in the Ukraine alone. There were another 2,502 KO in machine building enterprises in the Ukraine, a considerable number of which produce such energy equipment as coal-mining machinery. The average size and expenditures of these units are unknown but are surely large enough to imply a considerable volume of energy R and D performed outside what is defined in the USSR statistics as the R and D sector. It is usually said that enterprises do little R and D work, but both Western and Soviet commentators have objected that in fact a great deal of effort must be put in by enterprises to “master” the innovations that have supposedly been prepared by the R and D institutes. A machine may have been designed all the way to production of working drawings by a specialized ministerial KB, but the enterprise that is to produce it may have to redesign the item to make it producible. Most enterprises have an otdel glavnogo konstruktora (Department of the Chief Designer), often very large, and it is my impression that in many cases this department does a lot of R and D work. This seems to be the case for walking-dragline excavators, for example, for which most of the design, experimental work, and testing is done in the producing plants. It is often ambiguous as to whether or not the unit at the plant doing such work is kept administratively separate and treated as an R and D organization for purposes of compiling R and D statistics.

In general, my conclusion from looking at energy R and D in detail is that there is probably very inconsistent coverage of the various activities one might want to consider R and D, especially at the development end. The work of administratively separate KB is conceived by the Russians to be R and D, but a great deal of similar work is done elsewhere and does not get into official totals for R and D or into my inventory. If the concern is comparability with U.S. concepts, however, rather than internal consistency, I would judge that these omitted outlays and much of what is done in KB or in NII (and so reported as R and D) is routine engineering design that is excluded from R and D under the definitions enunciated by the U.S. National Science Foundation. In practice, of course, a great deal of similar work may get into U.S. R and D totals.

A final problem has to do with the kind of personnel included in R and D employment. Since expenditures on R and D are heavily concentrated on salaries, the scope of R and D expenditures depends largely on who is considered to be engaged in or supporting R and D activity. In Soviet statements about R and D, employment is described in several concepts. One is total employment in R and D institutions, which includes a considerable number of people engaged in support functions little related to actual R and D—administration, transport, maintenance, information services, and many others. Since R and D expenditures are basically conceived of as expenditures of R and D organizations, all these salaries are included. In Soviet R and D there are said to be only 20 “scientific workers” for every 80 employees in other (i.e., support) activities, while the corresponding ratio in the United States (as shown in the data reported by the National Science Foundation, NSF, for R and D performed in industry) is about 50/50. Soviet expenditure totals seem on this account to be inflated compared to U.S. figures.

A second employment concept is “scientific workers” in R and D organizations, which is supposed to include only those actually conducting scientific research. The goal of this concept is analogous to what the NSF is trying to capture in “scientists and engineers engaged in R and D,” though I believe the Soviet concept may be somewhat more restrictive. But it should be remembered that R and D expenditures in NSF statistics pay for a much broader range of personnel than are included in the concept of “scientists and engineers engaged in R and D.” Thus, the data for scientific workers in various Soviet energy R and D jurisdictions represent too narrow a base for any effort to move from personnel engaged in R and D to a wage total to an expenditures total. In what follows, accordingly, I work with the broad concept of employment, though this may inflate estimates of R and D expenditures.

Estimates of R and D Expenditures and Employment

On the basis of the inventory of R and D establishments mentioned earlier, it is possible to estimate with varying degrees of accuracy Soviet expenditures on energy sector R and D. In some cases, statements of employment or expenditures are given for whole ministries and, in many other cases, for individual research organizations. The ministerial statements also often give the number of various kinds of institutes in the system, which provides a basis for extrapolating from information on known institutes to aggregates for the system as a whole. Another method of filling in gaps or checking other estimates is to use some fairly systematic relationships between different categories of employment in R and D organizations and between employment and expenditures. One of the biggest problems is to bring all this scattered information to a common time period. In my estimates, 1975 is used as the reference year.

The following section describes the main elements in the energy R and D network and explains the derivation of estimates of their employment and expenditures. The estimates for the network as a whole are summarized in Table 2-1. A reader not interested in the details of estimation should skip directly to the next section, “Comparison with U.S. Energy R and D Expenditures.”

MINISTRY OF GEOLOGY (MINGEO). A fairly full description of the ministry’s R and D institutes as of 1968 (Ministerstvo Geologii SSSR, 1968, pp. 95–101) makes it possible to identify those which specialize in oil and gas. Of the total of 36, 16 were concerned almost exclusively with oil and gas; two others dealt with general regional problems and the economics of exploration generally. Much of the work of both must have been related to oil and gas. Five other institutes were responsible for research and development of equipment and techniques for exploration, a very large share of which must have been for the benefit of oil and gas exploration. Counting those seven institutes as about two-thirds devoted to oil and gas, would give oil and gas 21 of the total of 36 institutes. I imagine the oil and gas institutes tend to be larger than those concerned with other minerals, so that about three-fourths of the total effort should be allocated to oil and gas.

Employment in Mingeo’s R and D institutes at the beginning of 1968 was 29,653 persons of whom 10,156 were scientific workers (nauchnye rabotniki). Within that subtotal, 244 had “doctor of science” degrees and 2, 142 had “candidate of science” degrees. The total number of scientific workers had grown from a figure of 4,491 persons on 1 January 1961, or at an average annual rate of 12 percent.

By 1 January 1975, the network had changed somewhat, with various consolidations and reorganizations, so that the total number of institutes was 34 (Ekonomicheskaia Gazeta, 1975:39, p. 2). At that date doctor and candidate degree holders employed in Mingeo were 400 and 4,500 respectively, or 2.05 times the number noted above for 1968 —a growth rate of a little over 9 percent per year. The 2.05-fold increase should probably be discounted somewhat because the 1975 figures refer to Mingeo as a whole rather than to R and D institutes alone, and for the fact that the ratio of these highly trained persons to all scientific workers and to total R and D employment may have risen somewhat. Tending to offset this is the likelihood that the emphasis on oil and gas in the system was even greater in 1975 than in 1968. Thus, I estimate oil and gas R and D employment by simply taking 75 percent of double the number employed in all R and D institutes in 1968, which turns out to be 44,479 persons.

TABLE 2-1. Estimated Expenditures on Energy R and D in the USSR, 1975

I have found no statements as to R and D expenditures in Mingeo, but expenditures can be estimated as double the wage bill—i.e., employment times the average wage in the science sector in 1975 (155 rubles per month—TSSU SSSR, Narodnoe khoziaistvo SSSR, 1975, p. 547) adjusted for social insurance taxes (at the rate of 5.8 percent of wages—Syrovarov, 1966, p. 84). The result for R and D expenditures for oil and gas in Mingeo in 1975 is 175 million rubles.

MINISTRY OF THE OIL INDUSTRY (MINNEFT’). According to a statement made in mid-1975, there were 11 specialized NII, 5 KB, and 17 territorial NIPI in the ministry ( Ekonomika neftianoi promyshlennosti, 1975:7, p. 4). Total employment in these organizations was about 25,000, of which 1,750 were doctor and candidate degree holders. Total expenditures for scientific research (specifically nauchnye issledovaniia) were about 90 million rubles per year. These figures do not include the experimental factory controlled by the All-Union Scientific Research Institute for Drilling Equipment (VNIIBT).

There are some checks supporting the plausibility of these figures. Detailed information is available on several of the regional NIPI suggesting an average budget of about 1.5 million rubles per year, for a total of 25 million rubles. A plausible average for the 11 specialized NII is 4 million rubles per year. The All-Union Research Institute for Drilling Equipment (VNIIBT) had a budget of 4.3 million rubles in 1967 and has surely grown a great deal since then. Except for the All-Union Oil and Gas Research Institute (VNII), it is probably the biggest institute in Minneft’. On the basis of employment, the Institute for the Geology and Production of Mineral Fuels (IGiRGI) must have had a budget of over 4 million rubles in 1975. An average of 4 million rubles per NII and KB plus the 25 million rubles for territorial NIPI gives a total of 89 million rubles.

The wage bill for 25,000 employees would be 49.2 million rubles— 55 percent of the total reported expenditure of 90 million rubles—and is in line with the share of wages in all expenditures in R and D generally.

MINISTRY OF THE GAS INDUSTRY (MINGAZ). AS of 1975 this ministry had six specialized NII, six complex NIPI and four NPO containing R and D organs of various kinds (Gazovaia promyshlennost’, 1976:11, p. 10). Total employment in “science” in the branch is reported as 10.5 thousand persons, but this probably excludes people in KB or doing OKR. The Research Institute of the Gas Industry (VNIIgaz— probably the largest of the NII) had employment of 3,000 in 1973 (Gazovaia promyshlennost’, 1973:8). If average employment in all NII were half that, employment in NII alone would be 9,000 in 1973 and more in 1975. The employment figure for VNIIgaz in 1973 implies a wage bill of 5.7 million rubles and a total expenditure of 10–12 million rubles in this institute alone. One of the new NPO (Soiuzgazavtomatika) did NIR and OKR in 1974 of 5.86 million rubles. Both are probably larger-than-average institutions, but assuming that each of the 17 significant organizations of 1972 had expenditures of 4–5 million rubles, the total would be 70–85 million rubles. This suggests that the figure for employment in “science” above is too small, and I use a figure of 16,000 for employment which implies expenditures of about 63 million rubles.

MINISTRY FOR THE CONSTRUCTION OF OIL AND GAS INDUSTRY ENTERPRISES (MINNEFTEGAZSTROI). This is a small ministry, weak in R and I), and there is little information on its R and D activity. It is possible, however, to identify five or six significant institutes, and, if average employment is assumed to be 500 persons, employment would be 2,500 persons and expenditures about 10 million rubles.

MINISTRY OF OIL REFINING AND PETROCHEMICALS (MINNEFTEKHIM). In the early seventies, total employment in research and proektnye organizations was, by one account, 48,000 persons (Neftepererabotka i neftekhimiia, 1971:3, p. 5), and by another, 50,000 persons (Khimiia i tekhnologiia topliv i masel, 1971:5, p. 2). The number of professionals (by the educational criterion of being ITR, doctor or candidate) was about 29,000, of which 1,238 were doctors and candidates (Khimiia i tekhnologiia topliv i masel, 1973:9, p. 3). This statement seems to refer to 1971. During 1966—1970 expenditures on science in this ministry grew at an average annual rate of 6.5 percent per year (Gvishiani, 1973, p. 159), and assuming an employment growth rate of 5 percent in 1970–1975 would give 58—61 thousand persons in 1975. But the 48— 50 thousand total includes employees in proektnye organizations, in pusko-naladochnye offices, and in experimental (opytnye) factories. No information is available to separate R and D specifically on petrochemical work from the total, except descriptions for many of the organizations of their major functions. This suggests that a downward adjustment of about a third is in order, yielding an employment in research and development in 1975 of 39–41 thousand persons. I simply translate the estimated employment into a wage bill and then into a figure for total expenditures on the basis of a statement that in this ministry in 1968 the wage bill in R and D was 38.2 percent of R and D expenditures (Grishaev, 1970, p. 95). The estimate of expenditures is thus 190—199 million rubles.

MINISTRY OF CHEMICAL AND PETROLEUM MACHINEBUILDING (MINKHIM-MASH). Much of the R and D for oil and gas is performed in the machine building branches that produce its equipment. Some of this equipment is produced in ministries other than Minkhimmash (e.g., drilling rigs in the Ministry of Heavy Machine Building), but that will be discussed later. This ministry has 48 specialized NII, counting branches (filialy), and 25 PKO, both of which are considered R and D organs. I have no information on employment in institutes. To get a number to start with, I assume average employment per organization as 500 people, for total employment of 36,500 and a wage bill of 72 million rubles. In this ministry in 1968 expenditures on science were 1.71 times the wage bill, and assuming the same ratio held in 1975, expenditures would be 122.8 million rubles (Grishaev, 1970, p. 95).

A possible check shows that this may be too large. A decree of September 20, 1976, established the “unified-fund” method of financing in this ministry (Sobranie postanovlenii Pravitel’stva SSSR, 1976:22, pp. 409—418). The decree stipulated that the Gosbank should provide a credit of 12.5 million rubles for the first quarter of 1977, presumably pending the determination and transfer of profits to the fund at the end of the quarter (deductions into the fund are fixed as a percent of profits). This would suggest an annual volume of 50 million rubles, though the fund will also receive some budget financing. The decree suggests that total funds will be times the profit deductions, or 60 million rubles.

For now, however, I use the original approach and further assume that half the work is for oil and gas (rather than for the chemical industry proper). Hence, employment is about 18,000 and R and D expenditure is about 60 million rubles.

INSTITUTES IN THE ACADEMIES AND HIGHER EDUCATIONAL INSTITUTIONS (vuzy)— OIL AND GAS. A large number of VUZ and Academy institutes and institutes in higher educational institutions are concerned with oil and gas. The Academy system makes its biggest contribution in the areas of oil chemistry (including such related fields as physical chemistry and catalysis) and geology.

My inventory shows 15 significant institutes in the Academy system concerned with petrochemistry. These are fairly large institutes, and a plausible average expendure is 2 million rubles, for a total of 30 million rubles. Much of this research must concern such downstream activities as petrochemical production, so I reduce it to 20 million rubles and 5,000 people.

The Academy system is also strong in geology and geophysics. Some 13 institutes that are heavily specialized in oil, gas, and coal can be identified in the Republican Academies and in branches of the ANSSSR. The seven geological and geophysical institutes in the ANSSSR seem less oriented to specific fuel branches, though most of them work indirectly on energy sector problems. I take a figure of 15 institutes as appropriate here. With average employment of 300–500 people, this would mean 4,500–7,500 people and 17–19 million rubles.

There are also a couple of more specialized institutes—the Gas Institute in the Ukrainian Academy, and the Institute for Problems of Deep Fields in the Azerbaidzhan Academy—to add at an estimated expenditure of 2 million rubles each.

There are seven VUZy oriented mostly to oil and gas, and they do a significant amount of research work. The Gubkin Institute (MINKHiGP) is the principal VUZ in the oil and gas field and did over 4 million rubles worth of research in 1967. A figure of 5 million rubles for 1975 is perfectly plausible.

One source says that during the 9th Five Year Plan the seven VUZy in oil and gas did about 90 MR of NIR, or an average of 18 million rubles per year. Given growth and the figure for the Gubkin Institute, 20 million rubles of R and D in 1975 seems reasonable. Since the Gubkin Institute had 51 professors and 350 assistant professors (dotsenty) doing research plus 1,100 workers in the research sector, counting the teachers as halftime researchers would give 1,300 researchers for the 5 million rubles of research. I extrapolate this employment/ expenditures ratio to the whole collection, giving 5,300 persons employed in VUZ R and D.

MINISTRY OF THE COAL INDUSTRY (MINUGOL’). The most complete statement available refers to 1970, when there were 24 NII, employing

persons (excluding 4,711 workers in experimental factories) and with a total expenditure on research and experimental work of 53 million rubles. This expenditure figure seems too small, since at the 1970 average wage 23,000 workers imply a wage bill of about 40 million rubles, almost as large as total expenditures, which seems implausible. The Donets Coal Institute (DonUGI), one of the largest institutes, had an annual budget in 1966–1970 of about 3.5 million rubles and employment of about 1,200 persons (implying a wage bill of slightly over 2 million rubles), so that its total expenditures were 1.67 times the wage bill. I suspect we must go by the employment figure in estimating a total for the branch, and if the DonUGI expenditure per worker is representative, 23,000 employees would imply about 60 million rubles. But all this is for 1970, and I adjust employment to a 1975 base by raising it at the rate of about 4 percent per year, which would give over 92 million rubles per year in 1975.

Minugol’ also inherited in 1973 the R and D network for coal mining machinery formerly under the control of the Ministry of Heavy Machine Building. In 1967 this network included 19 KB and technological institutes designing coal mining machinery plus 10 experimental factories. The number probably did not increase much by 1975, and an estimated 750 persons per KB in 1975 would mean 14,000 employees and about 55 million rubles of expenditures.

In the Academy network, I count 11 institutes in exploration, processing, explosives, mining, etc., which are almost exclusively or heavily oriented toward coal, and which I will assume to have average expenditures of 2 million rubles for a total of 22 million rubles.

There are six VUZy heavily concentrated on coal—the big ones did 1.5–2 million rubles per year of research work in the sixties. The Leningrad Mining Institute did 3.8 million rubles in 1972 (only partially devoted to coal). An average of 1 million rubles per VUZ for coal in 1975 would mean 6 million rubles.

MINISTRY OF ELECTRIC POWER AND ELECTRIFICATION (MINENERGO). The ministry had 20 golovnye NII, employing 12,000 people in 1975. (Golovnye institutes are large organizations, each responsible for a particular area of research, both in the sense of performing it themselves and supervising related work in smaller institutions of lower rank.) The implied R and D expenditure of 50 million rubles seems small to me. The numbers also imply 600 employees per NII, which seems too small for the old and prestigious institutes of this branch.

The minister, P. S. Neporozhnyi, says in a statement that probably refers to 1970, that under the Minenergo organization that runs the whole R and D and project-making show, there are 70,000 employees. Of the five main project-making organizations, Gidroproekt has 17,0 employees and Teploproekt, 12,000. These are the two largest, and the implied 58 thousand persons in project making (the total employment of 70,000 less the 12,000 in NII) would mean average employment of 7,000 in the three smaller gipros, which seems somewhat large. Also, the gipros themselves contain NII and KB that may not be included in the 20 golovnye NII. But, lacking a basis for adjustment, I will use the 50 million ruble figure.

MINISTRY OF THE ELECTROTECHNICAL INDUSTRY (MINELEKTROTEKHPROM). Most of the R and D work on generators, transformers, switch gear, and other transmission equipment is performed in this ministry. (Turbines, boilers, and nuclear reactors are in the Ministry of Power Machine Building.) It has an elaborate network of R and D organizations, described in 1974 as having 33 specialized NII and KB, of which 17 were subordinated to enterprises and the rest to the ministry. Within the 16 subordinated to the ministry, 10 were KB and the rest, NII (Planovoe khoziaistvo, 1974:11, pp. 52–53). There are also numerous smaller R and D organizations—the 1974 source said that there were a total of 70 NII and KB in the ministry with their own experimental facilities, implying that there was still another group without such facilities.

I have been able to find virtually nothing on the size of these institutes or their expenditures. Total expenditure from the unified fund in this ministry in 1972 was about 300 million rubles (Bazarova, 1974), and was supposed to grow at about 9 percent per year in the 9th Five Year Plan (Gvishiani, 1973). But this fund finances not only R and D but also “mastering” (osvoenie, putting a new item into production), and we also know that it supplies only about half the funds for R and D work, the other half coming from contracts with customers (Arkhangel’skii, 1976, p. 103). All this implies a very large volume of funds in 1975, something over 700 million rubles (including osvoenie). Assuming 70 NII and KB, this would be about 11 million rubles expenditures per institute, which seems impossibly large. For example, it would imply over 3,000 employees per organization.

As an alternative approach, I assume that half the R and D work in this sector is for electric power generating and transmitting equipment (as opposed to energy-using equipment) and that this means 35 R and D organizations. I further assume average employment of 1,000 persons. A study in Leningrad showed planned expenditures per worker in 12 NII and KB in the electrotechnical sector of 2.4 thousand rubles per worker, or 1.62 times the employment cost per worker in the mid-sixties (Bliakhman, 1968, p. 22). Hence, 35,000 workers in 1975 would mean a wage bill of about 68.9 million rubles and 111 million rubles of R and D work. If average employment were only 800 persons, the corresponding figures would be 28,000 workers and 89 million rubles of expenditures.

MINISTRY OF POWER MACHINEBUILDING (MINENERGOMASH). There is little information on the R and D organizations in this ministry, but my inventory shows that in the mid-seventies it had 15–20 NII engaged in R and D on boilers, turbines, and nuclear plant equipment. Some of these are very large institutes (e.g., the Central Boiler and Turbine Institute) and assuming an average of 1,000 employees per institute implies 15–20 thousand persons or 60–80 million rubles of expenditure.

ACADEMY INSTITUTES AND INSTITUTES IN HIGHER EDUCATIONAL INSTITUTIONS—ELECTRIC POWER. There is still a large amount of basic research on problems of electric power in the Academies, though most of the applied research institutes were lost in the 1963 reshuffle.

The USSR Academy (ANSSSR) has three divisions concerned with energy R and D: Physico-technical Problems of Electric Power, Physics, and Nuclear Physics. Information as to what institutes actually exist in the USSR Academy in these divisions is quite inconsistent. At various points in the late sixties, mention is made of seven large institutes in electric power R and D as being in the Academy, but the 1975 Directory of the Academy shows only three: the Institute of High Temperatures in Moscow, the Institute of Thermophysics in Novosibirsk, and the Siberian Power Institute in Irkutsk (Akademiia Nauk SSSR, Spravochnik, 1975). The Directory may be incomplete, or more of these institutes may have been lost over the years to the ministries. M. A. Styrikovich, head of the Division of Physico-technical Problems of Electric Power, says that much of the effort of the Division goes into coordinating the work of institutes in the USSR Academy with those in the Republican Academies and those in the ministries. It seems strange that this Division should have under its control only a single research establishment (as shown in the 1975 Directory), but, given the evidence of the Directory, I conclude that there are only the three institutes in the ANSSSR. In view of the fact that some power institutes in the Republican Academies have expenditures of up to 3.5 million rubles, average expenditure for the institutes in ANSSSR should be at least five million rubles.

In the Republican academies, it is possible to identify nine power institutes and four smaller power “departments” (otdely) in the smaller academies and regional centers. Employment and expenditures can be estimated for several of these, with expenditures ranging from about one million rubles in the Electric Power Institute (Institut energetiki) of the Latvian Academy to 3.5 million rubles each in a couple of institutes in the Belorussian Academy. My estimate for the group as a whole is 21 million rubles; this does not include the institutes in the area of nuclear power.

The biggest of the VUZy, the Moscow Electric Power Institute (Moskovskii Energeticheskii Institut or MEI) is a significant center of electric power R and D, and performed 13 million rubles of NIR in 1967. Since then the number of labs has increased from 17 to 23, and, if we adjust expenditures by that yardstick (probably too small as an index of growth), we would have 17.6 million rubles in 1975; I round it up to 20 million rubles in 1975. The other electric power VUZy are much less important contributors to R and D. The Leningrad Polytechnical Institute has a high voltage lab that does almost a million rubles worth of R and D per year; the Leningrad Electrotechnical Institute does a few hundred thousand rubles worth of work per year.

Most polytechnical institutes in the USSR have an electrical engineering department, but on a smaller scale than LPI. I assume a total of 5 million rubles for all VUZy other than MEI.

NUCLEAR POWER RESEARCH. The major R and D organizations in this field are under the State Committee for the Peaceful Utilization of Atomic Energy, but the Academies do a lot of work on fusion, and, to judge from descriptions of the nuclear physics institutes in the Academies, by A. M. Petrosiants (Chairman of the State Committee), and others, a great deal of their work is concerned with nuclear power problems.* Most of the Committee’s institutes seem to be very large. The Kurchatov Institute has 5–6 thousand employees, and the Research Institute for Nuclear Reactors (NIIAR) in Dmitrovgrad had in 1970. (The Kurchatov payroll and budget is said to have been fairly stable for several years.) The seven big institutes under the Committee probably employ 19–20 thousand persons.

In addition to what the Kurchatov Institute does on fusion research, there are fusion programs in four other big institutes (Physico-technical Institute of the ANUkrSSR in Khar’kov, the Lebedev Physics Institute, the Ioffe Physico-technical Institute of the ANSSSR, and the Physico-technical Institute in Sukhumi). The Khar’kov institute is said to have 5,000 employees and the Lebedev Institute 3,000. We might estimate total employment in the four at 9–10 thousand persons (though some of these people are working on problems other than fusion) and transfer to fusion another 2,000 persons from the Kurchatov total.

The nine nuclear physics institutes in the Academies probably had employment of at least 10,000 persons. Employment in the Institute of Nuclear Energy of the Belorussian Academy was about one thousand in 1975. The Georgian Institute of Physics had expenditures in 1969 of 2,408 MR, which implies employment of 700–800 at that time, so that a figure of a thousand or more is likely for 1975. The average size of institutes in the Academy of Sciences of the Kazakh SSR in 1975 was something over 400 persons. Its nuclear physics institute would probably be larger than the average, but with less than a thousand employees. The other Republican Academy institutes would probably be much smaller, while those in the Ukrainian Academy, the SOANSSR and the ANSSSR, would be larger than the ones mentioned so far.

The descriptions of the work of these institutes make it clear that they do research on many topics that are only tenuously related to nuclear power; but in order not to leave them out of account entirely, it may be reasonable to show them as contributing 5,000 persons to nuclear power R and D.

The implied total employment figures of 35–37 thousand persons for all nuclear, and within that 11–12 thousand for fusion, work out to very large wage bills, and these have been multiplied by three to get estimates of total expenditures. (I assume that the material intensity of R and D in physics must be much higher than in the other kinds of research discussed so far.)

GEOTHERMAL. The geothermal program is small and scattered over a large number of small units. A Scientific Council on Geothermal Problems in the USSR Academy of Sciences has been in existence since 1964 (Dvorov, 1977, p. 25). A book on geothermal research in the Georgian SSR (Chikradze, 1972) describes the Geophysics Institute of the Georgian Academy as the main research organization and mentions work by the Laboratory of Geothermics and Hydrogeochemistry of the Geological Institute of the USSR Academy. The Leningrad Mining Institute operates a laboratory for work on dry, hot rock. The Institute of Geological Sciences and the Council for the Study of Productive Forces of the Armenian Academy have been doing research since 1957. Minenergo, the USSR Academy, and some other organizations are involved in the power generation aspects; the Academy and Mingeo are concerned with resource evaluation. Mingaz has the major responsibility for operations through four field administrations, and its R and D organizations do research on drilling geothermal wells and on producing and handling the brines. There is no basis for estimating an employment or expenditures figure, but it must be very small.

SOLAR. This program, too, is scattered among many small organizations. The scientific journal for this area of research— Geliotekhnika— is published by the Academy of Sciences of the Uzbek SSR, which administers the S. V. Starodubtsev Physico-technical Institute in Tashkent. This institute seems to be a major locus of solar energy research and could be a large institute, since the Uzbek Academy has 3,699 scientific workers in its 31 institutes, and the physics institutes are likely to be larger than average. Examination of the institutions whose research is reported in Geliotekhnika suggests that many institutions have solar research as a sideline to their main activity, such as institutes of electronics and institutes that need remote power sources (e.g., the Tashkent Communications Institute). The Physico-technical Institute of the Academy of Sciences of the Turkmen SSR works on solar cells, but this must be a very small program, since the average of scientific workers per institute in the Turkmen Academy was only 54 in 1975. There is a Research Institute of Current Sources, under Minpribor, which is a significant performer of this kind of research. There is still some research on solar energy at the Electric Power Institute (ENIN), and some efforts at VUZy.

An article reviewing ten years of the journal’s activity says that “there has been a considerable expansion in solar-technology research in the Soviet Union in the last ten years,” and adds that, in addition to institutions active in 1965 (Leningrad, Moscow, Erevan, Tashkent, Ashkhabad), new schools have been established in the Ukraine (concerned with the effect of high intensity light and heat fluxes and high temperatures on matter), in Moldavia (development of semiconductor photocells and effect of light on seeds), and in Azerbaidzhan (development of autonomous sources of supply using solar energy). They mention a three-meter solar furnace at the Uzbek Academy and a ten-meter furnace being built at Erevan. According to their summary, in 1975 there were 30 doctors and 100 candidates researching solar energy (Geliotekhnika, 1975:314, pp. 3–4).

OIL SHALE AND PEAT. There is only one institute for the oil shale industry—the Scientific Research Institute for Shale (NIIslantsev) in the Ministry of Petroleum Refining and Petrochemicals. Mining of shale is administratively under the coal industry, and some of the coal industry research organizations have a place in their programs for shale mining. There is also an Institute of Chemistry in the Academy of Sciences of the Estonian SSR which works mostly on kerogen, and had a 1975 budget of about 2.5 million rubles. I have found only two institutes for the peat industry: the Peat Institute (Institut torfa) of the Belorussian Academy in Minsk, which had a staff of 232 persons in 1968; and the All-Union Research Institute of the Peat Industry in Leningrad, with a Moscow branch. The latter is under the jurisdiction of the Ministry of Agriculture.

The reader who has followed the description of the evidence and its translation into estimates of employment and expenditure may justifiably express considerable skepticism about the accuracy of the results. Some decisions are admittedly arbitrary; overall, the results are probably biased downward, a choice based on the fact that one use for these totals is to compare them with U.S. expenditures on energy R and D. The totals shown are probably a conservative estimate compared to what would be generated by more complete information about the energy R and D establishment, both because of this bias and because of possible omissions, especially of energy-related work outside the energy sector.

COMPARISON WITH U.S.
ENERGY R&D EXPENDITURES

For purposes of comparison with the United States, it will be useful to summarize the data of Table 2-1 in slightly different form. In Table 2-2 expenditures are grouped in terms of the areas usually considered in discussions of energy R and D expenditures in the United States. Throughout, I have chosen the lower figure when Table 2-1 showed a range. For the most part these are just obvious sums of items from Table 2-1, but there are a few amendments. I have transferred from the ministerial sums generous estimates for the expenditures of the six institutes explicitly concerned with environmental and safety problems, and for a new institute concerned with conservation, and shown them under corresponding headings. These are surely underestimates of expenditures for these purposes, since some work on these problems takes place in other of the institutes covered and also in institutes outside the ministries examined here. In the first column, expenditures in the equipment ministries are included with the appropriate energy producing ministries, but in column (3) they are pulled out into a separate category. This is an incomplete figure for machinery development, since many of the institutes in the producing ministries are also concerned with designing new equipment. But I see no way to separate out appropriate amounts.

TABLE 2-2. Soviet Energy R and D Expenditures by Major Programs

*Distributed by sector.

So far as I can find, there exists no satisfactory summary of overall U.S. energy R and D expenditures, but a reasonable total and structure can be put together on the basis of Table 2-3.

TABLE 2-3. U.S. Energy R and D Expenditures, 1975*
(million dollars)

*Calendar year for industrial performers, fiscal 1975 for federal data.

Sources: Federal performers from NSF, Reviews of Data on Science Resources, Energy and Energy-Related R and D Activities of Federal Installations and Federally Funded Research and Development Centers, NSF 76–304, April 1976. Industrial Performers from NSF, Research and Development in Industry, 1974, NSF 76–322. Federal funds from NSF, Analysis of Federal R and D Funding by Function, NSF 76–325. For federal funds, the allocation of items in the sources by the categories of this table is as follows:

The NSF has published estimates of R and D expenditures by federal performers and by industry for 1975, but in the NSF system this means that energy R and D performed in other sectors (such as nonprofit institutions, universities, and so on) is not included. However, NSF also publishes an analysis of federal funds for financing R and D, by function, with the functions being more or less assimilable to the categories of the two summaries already mentioned. In this functional breakdown, “environmental” and “basic research” are shown as functions separate from energy, and one has to pull out of those tables the programs that seem energy-related. Since federal funds finance some R and D performed in sectors other than government and industry, in those categories where federal funds exceed the sum of expenditures by federal performers and industrial performers, the former should be taken as a better estimate. The major categories of these are fusion research, basic research, and environmental safety, in which there are significant expenditures in universities (and perhaps in other omitted performing sectors as well).

When the additional 46.3 million dollars for fusion, 58.7 million dollars for basic research, and 264.7 million dollars for environmental and safety research estimated in this way are added to the amounts shown in column (3) the total becomes 2,512.9 million dollars.

This approach will still fail to capture such energy R and D as is performed in sectors other than government and industry and is either self-financed or financed by industry. But I believe those omissions will be quite small in relation to the total.*

Our approach has the advantage of sticking with the NSF concept of current expenditures only (capital expenditures and demonstration plants are excluded) and also permits separating the R and D performed in the machinery branches supplying equipment for the energy sectors. Unfortunately, the method hybridizes fiscal years (for federal funds) and calendar years (for industrial performers), but permits us to use the “obligations” concept for federal funds and performers (rather than the budget authority concept), thus maintaining approximate consistency with the “expenditures” concept used for industrial performers.

Acknowledging that many conceptual differences with respect to coverage and internal classification interfere with comparability of the U.S. and Soviet summaries, a comparison of the two still suggests some interesting conclusions and raises some puzzles that need further study.

To assess the overall relative size of the two countries’ efforts, some general notion is needed of how much R and D resources a ruble buys. In some other calculations I have made, based on converting the various elements in the Soviet R and D expenditure total at a plausible ruble/dollar ratio, the overall conversion ratio that emerged was 3.8 dollars to the ruble (that is, one ruble buys as much resources as 3.8 dollars). This refers to R and D expenditures in general, as it is not possible to make such a calculation for energy R and D alone. The dominant influence on this result is the relative wages of U.S. and Soviet employees in R and D, figured separately for the two categories of scientific workers and supporting personnel. Labor is the most important element in R and D expenditures, and the dollar cost of labor relative to the ruble cost is so high that the dollar/ruble ratio for all R and D resources is of the order indicated. I stress that any such comparisons as this are extremely treacherous, but even if the ratio were significantly different (say 3 dollars per ruble), it appears that the Soviet energy R and D program is very large compared to the U.S. program. At a conversion ratio of 3.8 dollars per ruble, Soviet expenditures are almost five billion dollars in 1975, about double the U.S. figure for the same year.

In interpreting that statement, however, many qualifications must be kept in mind.

(1) First, there is no doubt a strong index number effect at work here. Soviet R and D input mixes are heavy on manpower compared to U.S. mixes, and since the manpower/other input price ratio is higher in the dollar price system than in the ruble price system, a comparison in the ruble price system would no doubt show a significantly lower relative standing.

(2) The Soviet figure is probably inflated in the sense that it covers some activities that are not considered R and D and are not included in the U.S. totals. As explained earlier, the method of totaling budgets of research organizations rather than research programs brings in expenditures on employees engaged in all kinds of auxiliary operations that are peripheral to actual R and D and that do not get counted in U.S. totals. The janitors, the chauffeurs, and a top-heavy load of administrators are examples.

(3) Examination of the differing structures of the two totals suggests that the Soviet total includes some activities that are not counted as R and D in the United States. For example, expenditures on geological R and D are very large in the USSR, accounting for 15 percent of the total, versus the 1 percent we can isolate for the United States. The geology figure for the United States in Table 2-3 covers only federal performers, and it may well be that significant amounts of company financed R and D in oil and gas is for geological and exploration tasks. In the Soviet case, however, our geology figure similarly omits the large amount of geological work done in the R and D organizations of Minneft’ and Mingaz.

(4) On the other hand, the Soviet total includes little activity that could be described as safety and environmental R and D, which accounts for almost 15 percent of the U.S. program. Some Soviet environmental and safety work is done outside the network of organizations this survey has covered, and what is done in this network is not fully separated out. Also, in the United States a very large amount of environmental research would seem to be included as energy-relevant only because of institutional peculiarities (ERDA finances a big environmental and health program) or for image purposes. If this category of expenditures is removed from both sides, the remaining 1282 million rubles of Soviet R and D seems an even larger program in relation to the remaining 2144 million dollars worth of U.S. energy R and D.

(5) Some structural differences are so striking that they can probably be taken as reflecting real differences, despite underlying noncomparabilities in definition or errors in estimation. Expenditures in the field of nuclear energy are much more important relative to fossil fuel programs in the United States than in the Soviet Union. The nuclear/fossil ratio is 1.88 in the United States, but 0.25 in the USSR. If we compare the two halves of this ratio separately, the figures suggest that the Soviet nuclear program may be smaller in absolute terms than ours. I do not know enough to judge whether that is plausible. The Soviet program is certainly ambitious and productive in the sense of covering a lot of areas, including fusion, and in the sense of having created an operating technology. It may be somewhat starker in terms of alternatives; perhaps it is more efficient. The small relative size of the Soviet nuclear program is so striking that it makes one wonder if some egregious omission has been made in adding up the elements of the Soviet nuclear program. The institutes I have included are mostly those which Westerners have visited; perhaps there are some important secret ones. It is likely that significant amounts of work are done for the nuclear power program in institutes not covered—in mathematical institutes, chemical and material research institutes, and so on. Whatever work is done by Minenergomash for the nuclear program is shown in my table under electric power rather than nuclear.

On the other hand, I have been fairly generous in estimating outlays for the nuclear program. For example, I have blown up the wage bill by a factor of three rather than the two or less characteristic of other fields, I have included a number of academy nuclear research institutes that are only partially energy-relevant, and so on.

Soviet expenditures on the fossil part of the ratio, however, seem extraordinarily large—five or six times larger than in the United States. In trying to explain these large expenditures, we can point to several contributing factors beyond those already mentioned (such as the inclusion of geology). I believe, for example, that these include expenditures on much activity that is not R and D at all, but routine managerial work, routine production engineering, technical support, and other such functions that may get into the U.S. figures to some extent (though they are not supposed to by the definitions) but that get into the Soviet figures on a much larger scale. Detailed descriptions of individual Soviet research institutes in the oil and gas sector show that much of what they do is production trouble shooting, routine economic analyses, simple geology, and so on. In the final analysis, however, the conclusion seems inescapable that with such large expenditures and the present level of Soviet fossil fuel technology, the R and D institutions in these conventional energy areas must display strongly the inefficiency thought to be common in much of Soviet R and D.

(6) Note that the geothermal and solar programs constitute even less palpable elements in the Soviet total than the United States program.

(7) Finally, note the large expenditures in the USSR for nonnuclear electric power. A curious feature of all the U.S. distributions is that they show very little R and D for electric power. The NSF breakdown of energy R and D performed in industry (see below) has no such category, except as it may be captured in “other,” and in the NSF analysis of federal funds expenditures shown for electric power under the heading of conservation really are measures for “conservation” rather than for the development of electric power equipment. It seems to me possible that much R and D for developing new electric power equipment is not included in the U.S. totals. Consider the following NSF table on R and D performed in industry for 1974, which shows expenditures by product field (in millions of dollars):

All of the expenditures for developing electrical transmission and distribution equipment would seem to be energy-relevant, and there must be significant R and D for conventional power plant turbines in the “engines and turbines” category and for electric power generating equipment in the “other electrical equipment” category. But there is no room for expenditures of this magnitude in the alternative classification of R and D expenditures by areas, shown in the same source as follows (in millions of dollars):

R and D for transmission and distribution alone significantly exceeds the unidentified “other” categories where it would have to go. It may be that NSF wants its concept of energy R and D to exclude development of this kind of equipment, though it would seem that if the development of nuclear reactors is to be included, then improvement of conventional generating and transmission facilities should also be included. In any case, this difference helps explain why the Soviet total looks so large in relation to that for the United States.

But even with all these allowances, the final conclusion seems to be that, in the area of conventional energy sources and electric power generation, the USSR has such large expenditures that, in the light of the level of technology in those branches, it must be very inefficient in that kind of R and D. This is explained in terms of inertial growth and programming, reinventing the bicycle, duplication of effort, divorce of R and D from practical needs, and the other organizational pathologies often ascribed to Soviet R and D in general.

CONCLUSIONS

With this chapter, the task of Part I is completed. How energy policy is made has been described, as has the generally important role that innovation and technological change are called upon to perform as instruments of energy management. This chapter has shown that there have certainly been impressive amounts of resources devoted to the R and D activities that are intended to produce these innovations. One aspect of the matter not very carefully examined is whether this seemingly lavish provision of R and D resources for energy is a policy of long standing. In general, Soviet R and D employment and expenditures have grown during the post-World War II period at rates far above most economic subaggregates. Between 1950 and 1975, employment in Soviet R and D grew at a rate of 8.5 percent per year, compared to only 3.2 percent per year for industrial employment. Energy R and D growth has surely reflected this overall trend with reasonable sensitivity. Moved back to the fifties at something like the 8.5 percent rate cited, the amount of resources devoted to energy R and D in that decade was far smaller than today. But the inventory of these R and D institutions makes clear that many of them have existed for a long time and were large institutions already in the fifties. Whatever the history has been, however, enough R and D resources have been poured into solving energy problems that one is puzzled that they have not produced more rapid productivity growth.

Some hints of what may be the problem have been given along the way in the description of the R and D establishment, and some ideas of the weaknesses that might be expected to interfere with innovation in this kind of system have been offered in the earlier part of this chapter. But to obtain any concrete perspective on how well energy R and D operates, what problems may hamper its effectiveness, and how well it fits into overall energy management, it is necessary to look at actual experiences. What is required is a more detailed look at technological policies in particular sectors, what concrete R and D tasks have been, and how the planning, R and D performance, and mastering of specific innovations has worked. For this purpose the following chapters examine several examples of R and D and innovation at work. These chapters may be considered a kind of case study approach intended both to generate some judgments about the effectiveness of R and D and to reveal specific features of the Soviet approach to R and D that will be generalized in the final chapter.

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*Several excellent treatments of the Soviet R and D system as a whole are: Zaleski, 1969; Nolting, 1973, 1976a, 1976b; Nimitz, 1974.

*The results of one of the studies produced by the power industry are presented in Energetik (1970:7, p. 36).

*The relative size of Soviet and American R and D expenditures is becoming an increasingly important concern in the light of the way Soviet R and D expenditures are outstripping U.S. expenditures, but there remain many unresolved issues in assessing how comparable the two sets of statistics are. For a statement of concern about the lagging U.S. position sec National Science Board, 1975. Several of the general works cited earlier describe the controversies concerning the comparability of the two sets of statistics.

*These standard Soviet acronyms stand for nauchno-issledovatel'skie raboty (scientific-research work) and opytno-konstruktorskie raboty (experimental-design work), which together are usually taken as meaning the same as the U.S. concept of research and development.

*A fairly extensive description of nuclear research and nuclear research institutes is given in Petrosiants (1976, pp. 353–403). Numerous Westerners have visited many of these institutes, and their reports contain numerous statements about employment in them.

*It is also possible to get another view of federal financing by examining the ERDA or OMB statements of “federal energy R and D” (which is essentially a financing concept); but it turns out this view does not really add any useful information, and I have not included it in Table 2-3.