THE ECONOMIC NATURE OF RESEARCH COSTS

L. L. Beloborodova

F. Engels, in his work Outlines of a Critique of Political Economy, wrote that for the bourgeois economist “the successes of science lie beyond the bounds of his calculations. But under a rational order, standing above the fragmentation of interests as it exists among economists, the spiritual element will, of course, belong among the elements of production and will find its place among the costs of production and in political economy.”¹

Therefore, in order to determine the economic nature of expenditures on scientific research, it is necessary to clarify: whether expenditures on scientific research are costs of production; whether all expenditures on scientific research are costs; and what practical significance is attached to the theoretical recognition of expenditures on scientific research as costs of production.

Costs of production as an economic category are considered from two points of view: from the point of view of the labor process and from the point of view of their social form. For us, political economists, it is above all necessary to clarify the social form of labor expenditures on scientific research. V. I. Lenin pointed out that “a definite politico-economic category is not labor, but only the social form of labor.”²

But before clarifying the social form of costs of production, it is necessary to examine costs of production from the point of view of the labor process and to clarify the general concepts concerning expenditures on scientific research. Without this, it would be impossible subsequently to consider those social forms which these expenditures assume under the specific conditions of each social formation. Moreover, consideration of expenditures on scientific research from the point of view of the labor process, irrespective of social forms, is necessary for the correct calculation of the aggregate social product (and, correspondingly, of national income), since in different socio-economic formations there is a need to calculate the entire aggregate social product produced in the country.

From the point of view of the labor process, expenditures on scientific research become productive expenditures (costs of production) with the establishment of machine production, with the beginning of the transformation of science into a direct productive force. But in order to prove the productive character of expenditures on scientific research, it is neces-

it is necessary first to determine what activity in general belongs to the productive sphere and what belongs to the nonproductive sphere.

In the economic literature there is still no single opinion on the criterion for dividing the national economy into productive and nonproductive spheres. Thus, for example, P. M. Moskvin and G. Ya. Kiperman take as the basis for dividing the national economy into productive and nonproductive spheres the material form of the product of labor;³ S. G. Strumilin and Ya. A. Kronrod—the material form of the product and the form of various kinds of energy;⁴ M. V. Kolganov, A. K. Pokrytan, and the Instruction of the Board of the Central Statistical Administration—the reproducibility of the product;⁵ V. Shtipelman and E. Kaganov—productive and nonproductive labor.⁶

All these conceptions are incorrect, for their authors identify the productive sphere with material production and, in distinguishing the two spheres, proceed from the form of the result of labor, reproducibility, the duration of the effect obtained from the good created, and the form of consumption of the product produced, rather than from the concrete content of labor, conditioned by the social division of labor.

In determining the essence of the productive sphere and the belonging to it of individual spheres of activity, the main criterion is the concrete content of labor, the result of which is a product in object-material form or in the form of an effect satisfying certain social needs. The use of this criterion gives grounds for assigning scientific activity to the productive sphere.

It is known that scientific research produces a great effect; indications of this can be found in many researchers. True, their economic assessment of the effectiveness of scientific research differs. Thus, for example, V. A. Trapeznikov asserts that 1 ruble invested in science ensures 1 ruble 45 kopecks of growth in national income; S. I. Golosovskii—48–65 kopecks; V. S. Sominskii—3–5 rubles, etc.⁷

The reason for the different assessments of the effectiveness of scientific research is that researchers understand effectiveness itself differently, and also that they use different methods of calculation and proceed from a direct dependence between the costs and the results of scientific research, rather than from a correlational one. V. A. Medvedev, P. G. Oldak, L. S. Glyazer, and K. K. Valdukh are right in not limiting the productive sphere to material production.

Social production represents (and has always represented) the unity of material and spiritual production. This unity follows from the fact that, first, human labor includes elements of physical and mental labor. It is precisely the presence of the spiritual element in human activity that is one of the characteristic features of labor, “constitutes the exclusive property of man”⁸ and distinguishes human labor activity from instinctive—

³ P. M. Moskvin, Questions of Statistics of the National Income of the USSR. Moscow, 1955, p. 19.

⁴ Ya. A. Kronrod, The Social Product and Its Structure under Socialism. Moscow, 1963, p. 12.

⁵ A. K. Pokrytan, Production Relations and the Economic Laws of Socialism. Moscow, Mysl Publishing House, 1971, p. 177; M. V. Kolganov, National Income. Moscow, Publishing House of the Academy of Sciences of the USSR, 1959, p. 90.

⁶ V. Shtipelman, E. Kaganov, “The Boundaries of Productive Labor,” ME i MO, 1970, No. 12, p. 99. (The viewpoint of these authors is correct only with a general methodological approach to these two problems.)

⁷ A. A. Trapeznikov, “Automatics–Telemechanics,” 1969, No. 1, p. 15; S. G. Golosovskii, The Effectiveness of Science. Ekonomika Publishing House, 1969, pp. 129–130; V. S. Sominskii, “Economic Gazette,” 1967, No. 10, p. 7.

⁸ K. Marx and F. Engels, Works, 2nd ed., vol. 23, p. 189.

...of the behavior of animals; second, in the factors that constitute the labor process, a distinction is made between the material factors of production (the means and objects of labor) and the subjective, spiritual factor: the activity of man—a man with his productive experience, skill, and scientific knowledge; third, for the reproduction of labor power, products of both material and spiritual production are necessary.

K. Marx wrote that “...by labor power, or capacity for labor, we understand the aggregate of those physical and mental capabilities existing in the organism, the living personality of a human being, which he sets in motion whenever he produces use-values of any kind.”³

It follows from this that for the reproduction of labor power, products not only of material but also of spiritual production are necessary.

Social production is production of a dual kind. On the one hand, it is material production (the production of the means of life: food, clothing, housing, and the instruments necessary for this); on the other hand, it is spiritual production (the production and transmission from generation to generation of productive experience, skills, and scientific knowledge), without which social production is impossible.

The problem of spiritual production is not the problem of its presence or absence (for spiritual production always exists), but the problem of the strength and depth of its influence on the development of social production as a whole, the problem of clarifying the specific forms of spiritual production at different levels in the development of the productive forces.

Spiritual production, like material production, changes and develops with the development of the social division of labor. Initially the product of spiritual production appeared in a single form—in the form of productive experience and skills, which were connected with labor directly in material production. With the transition to machine production, spiritual production already appears in two forms: in the form of productive experience and skills and in the form of scientific knowledge. Scientific knowledge, in turn, appears, first, in the form of the scientific and professional knowledge of a person engaged in social production (this includes the qualifications of a scientist, engineer, technician, or worker); and, second, in the form of scientific knowledge embodied in the material means of production (first examples) and of scientific knowledge used in the organization of labor and production. The first type of scientific knowledge is separated into an independent branch of spiritual production—the branch of education; the second—into the branch of scientific research. The separation of scientific research and education into independent branches is conditioned by the further development of the social division of labor. And if before machine production, when relatively simple instruments of production were set in motion, social production could exist and develop only on the basis of productive experience and skills, today this is insufficient. A certain volume of scientific knowledge is required. Moreover, skill and experience themselves are changing qualitatively. The emergence of new and ever more complex equipment and production technology leads to the fact that productive experience increasingly includes mastery of those scientific insights that are embodied in the newest instruments of production.

With the development of social production, the degree of qualification of personnel increases. Education produces a great effect, and none of the researchers denies this.

The high efficiency of society’s expenditures on the development of public education has been noted by Academician S. G. Strumilin, V. A. Zhamin, G. O. Egiazaryan, L. I. Tulchinsky. Thus, for example, S. G. Strumilin calculated that the productivity of a worker trained in higher education exceeds the state’s expenditures on his training by 11 times. Overall, every ruble spent on school education increases the country’s national income by at least 6 rubles per year⁴.

However, V. A. Zhamin, L. I. Tulchinsky, and others, while not denying the effectiveness of education, at the same time believe that education does not belong to the sphere of production, that labor in the sphere of public education does not directly create the necessary and surplus product, and that education, as part of the nonproductive sphere, exists through the redistribution of national income created in the sphere of material production⁵.

But since education creates a real effect necessary for the reproduction of labor power, education may be assigned to the sphere of production. Yet whether all types of education should be assigned to the sphere of production is a controversial question.

As for scientific research, most authors assign it to the nonproductive sphere. This can also be encountered in practice. To substantiate this, the view is used that science is a form of social consciousness and, in this capacity, cannot be considered a branch of production. At the same time it is emphasized that science may promote the growth of the productive forces, but that including it in social production supposedly leads to a confusion of two kinds of phenomena: spiritual phenomena, connected with consciousness, and material phenomena, connected with production. This judgment is unfounded, since social production is a unity of material and spiritual production. And the fact that science is becoming a direct productive force does not mean that science ceases to be one of the forms of social consciousness or that the essence of science changes. It means only that science has acquired a new social function: it is becoming an independent sphere of activity within the system of the social division of labor and is being included in social production. It is included in social production not as an independent element of the productive forces, as some authors write, but as an independent sphere of activity. This is explained by the fact that science cannot be separated from the human being—the bearer of scientific knowledge. The necessity of including science in social production is dictated by the fact that, as production becomes more complex, its new means cannot be created without prior scientific research. If earlier, in the eighteenth century, the steam engine was created chiefly as a result of empirical searches, since people had long and widely used in practice the simple forms of motion of matter (simple in terms of their study and practical use), mechanical and thermal, then two centuries later, in the middle of the twentieth century, the situation changes. A person, for example, had no idea of intranuclear energy before the end of the nineteenth century; therefore, without a preliminary, complex, and very lengthy study of the new phenomenon, there could be no thought of its practical application.

Material production by itself is not capable of solving scientific problems by the techniques and methods proper to it. Therefore they are solved by scientists using their special scientific methods and means.

But the fact that scientific research precedes material production does not mean that the spiritual factor of production has become determining in relation to the material factor, or that material production has lost its significance as the determinant of the development of all other types of human activity. The development of scientific research is determined by material production, for the needs of material production determine the direction and content of the development of science; and material production provides the sphere of scientific activity with the material conditions necessary for the development of science.

Not all scientific research belongs to the production sphere, but only that which is already being applied or can be applied in production. This includes primarily scientific research in the field of the technical and natural sciences, as well as in the field of the social sciences (those developing questions of the organization of production, cooperation, specialization, etc.) and adjacent sciences that arise at the intersection of the technical, natural, and social sciences (engineering psychology, technical aesthetics, labor physiology, social psychology, etc.).

According to V. G. Lebedev’s calculations, at present 53% of all scientific workers are engaged in problems connected with production.^12 As the productive forces develop, the range of scientific research entering the production sphere expands; moreover, scientific research constitutes a separate, independent branch of spiritual production, and not a separate branch of material production, as V. A. Zhamin, A. B. Nikolaev, and I. I. Kozodoev assert.

The recognition of scientific research as an organic part of material production (and I. I. Kozodoev even holds that, with the final transformation of science into a direct productive force, there will occur an organic merging of science with production and the sphere of scientific activity, as a special sphere of human activity, will disappear) is, in essence, tantamount to the old conception that reduces the productive forces only to the material factors of production. In addition, such recognition leads to diminishing the significance of studying the specific character of spiritual production, which consists in the fact that science is characterized by accelerated development; that science can also develop on its own basis; that, with the consumption of scientific output, the latter is not destroyed but, on the contrary, accumulates; and that there exists a special character of the links and interrelations with the branches of material production.

Thus, the majority of economists assign production-related scientific research to the nonproductive sphere. Expenditures on it are made through the redistribution of national income. However, the material outlays for scientific research (depreciation of equipment, costs of materials, fuel, electric power, etc.) are added to the aggregate social product, to the consumption fund. In 1965, material outlays on research and administration amounted to 4.4% of the consumption fund. In our view, it is illogical to include in the social product only the material outlays for scientific research. With such a calculation, the social product created during the given period of time will be understated.

Production-related scientific research, in our opinion, belongs to the production sphere; the expenditures on it are of a productive character. Therefore it is necessary to take into account in the social pro-

^12 V. G. Lebedev, The National-Economic Efficiency of the Development of Technology. Moscow: Mysl Publishers, 1971, pp. 68, 240.

product all the expenditures of production-oriented scientific research (expenditures of living and materialized labor), and moreover not in the consumption fund, but in the accumulation fund. As the results of scientific research are realized in material production, the expenditures on them should be written off from the accumulation fund as costs of production and added to total production costs.

In accounting for expenditures on scientific research, the expenditures at all stages of a given research project must be taken into account: expenditures in theoretical and applied research and in development work. These expenditures are to be accounted for not by individual institutions, but by a central planning body that has information on the entire cycle of the research, on the completion of the given scientific research. In each current year, the accumulated results of expenditures on science made in previous years are realized in material production. In order to determine the magnitude of production costs, it is necessary to know for how many years the results of scientific research are operative in production and the scale of their use.

In accounting for expenditures on scientific research, it is necessary to take into account the specific character of scientific activity (its probabilistic nature, the use of theoretical research not only in production, etc.). Expenditures on theoretical research can be calculated approximately, especially since the ratios among expenditures on theoretical research, applied research, and development work are \(1:10:100\). Expenditures on unsuccessful applied research (which amount to \(10\text{—}15\%\)) and on scientific research conducted in parallel should expediently be charged not to the budget, but to the production costs of a definite, specific type of scientific research. The latter may be branches, groups of branches, or the national economy as a whole—depending on the purpose and character of the research. Such a method of accounting for expenditures makes it possible to adjust calculations of the efficiency of scientific research.

The expenditures on production-oriented scientific research should theoretically be regarded as production costs both under socialism and under capitalism. But under capitalism, owing to the existence of private property, it is practically impossible to charge all expenditures on scientific research to production costs. In capitalist countries, depending on the financing of research-and-development activity, expenditures on scientific research are accounted for in different ways in the aggregate social product: if scientific research is paid for by the government, it is accounted for as part of the national product regardless of the purposes served by this scientific research; if it is paid for by a nonprofit organization, it is accounted for as part of consumer expenditures; if a commercial enterprise pays for it, everything will depend on how the company itself shows these expenditures in its accounting; if they are carried out under the item of investments, they will be presented as capital investments; but if they are spent in connection with the current output of the products produced by the firm, they will be accounted for as current production costs.^13

Thus, recognition of expenditures on scientific research as production expenditures will, first, lead to the necessity of an economic calculation of the magnitude of expenditures on scientific research directly on the basis of the volume of production, and not on the basis of allocations for social and cultural measures, and, second, will make it possible to use them correctly.

^13 F. Machlup, The Production and Distribution of Knowledge in the United States. Moscow, Progress Publishers, 1966, pp. 225—228.

1. K. Marx and F. Engels, Works, vol. 1, p. 555. ↩

2. V. I. Lenin, Collected Works, vol. 7, p. 45. ↩

3. K. Marx and F. Engels, Works, vol. 23, p. 178. ↩

4. S. G. Strumilin, Problems of Labor Economics. Moscow, 1957, pp. 185, 598. ↩

5. V. A. Zhamin, The Economics of Education (Questions of Theory and Practice). Moscow, Prosveshchenie Publishing House, 1969, p. 206. ↩