State of the Nation 2012

Appendix B: Glossary of Terms


ANGEL INVESTOR: A high-net-worth individual active in venture financing, typically participating at an early stage of company growth.

BIBLIOMETRIC IMPACT INDICATORS: A measure of the influence of researchers through counts of citations of publications.

BIBLIOMETRIC INDICATORS: A mathematical and statistical method used to analyze different characteristics of peer-reviewed scientific articles published in international academic journals.

BIBLIOMETRIC QUANTITY INDICATORS: A measure of the productivity of researchers in absolute numbers through number of publications.

BIBLIOMETRIC STRUCTURAL INDICATORS: A measure of collaboration among researchers from different countries through international co-publications.

BUSINESS ENTERPRISE EXPENDITURES ON RESEARCH AND DEVELOPMENT (BERD): Research and development (R&D) activities performed by firms, regardless of the origin of funding. This is to be distinguished from business enterprise R&D funding, which comprises the total business sector funding of R&D, whether the R&D is performed within industry, the higher education sector, government or other sectors of the economy.

BUSINESS ENTERPRISE EXPENDITURES ON RESEARCH AND DEVELOPMENT (BERD) INTENSITY: The ratio of BERD to a measure of output, usually Gross Domestic Product (GDP). Also referred to as BERD-to-GDP.

BUSINESS ENTERPRISE FUNDING OF R&D: The total business sector funding of R&D, whether the R&D is performed within industry, the higher education sector, government or other sectors of the economy. This is to be distinguished from BERD, which covers R&D activities performed by firms, regardless of the origin of funding.

CONSTANT PRICES: A common set of prices used to value the output of a firm or an economy in successive periods.

CURRENT PRICES: Measurement of economic magnitudes using the prices actually prevailing at any given time.

DEMAND-PULL KNOWLEDGE TRANSFER: Model of knowledge transfer where universities and other research organizations are solicited by industry to find solutions to production and innovation problems.

EDUCATION, CLASSIFICATION OF LEVELS: The classification of the levels of education is based on the new International Standard Classification of Education (ISCED 2011):

  • UPPER SECONDARY LEVEL: Students typically expected to have completed nine years of education or lower secondary schooling before entry.
  • UNIVERSITY UNDERGRADUATE AND GRADUATE (MASTER’S) LEVEL: Refers to programs classified by the OECD as tertiary-type A education, or ISCED 5A. Largely theory-based programs designed to provide sufficient qualifications for entry to advanced research programs and professions with high skill requirements, such as medicine, dentistry or architecture. Duration of these programs is at least three years full-time, though usually four or more years. These programs are not exclusively offered at universities, and not all programs nationally recognised as university programs fulfill the criteria to be classified as tertiary-type A. Tertiary-type A programs include second-degree programs, such as the master’s degree.
  • COLLEGE LEVEL: Refers to programs classified by the OECD as tertiary-type B education, or ISCED 5B. Programs are typically shorter than those of tertiary-type A and focus on practical, technical or occupational skills for direct entry into the labour market, although some theoretical foundations may be covered in the respective programs. They have a minimum duration of two years full-time equivalent at the tertiary level.
  • UNIVERSITY DOCTORAL (ADVANCED RESEARCH) LEVEL: Refers to programs classified by the OECD as advanced research programs, or ISCED 6. These programs lead directly to the award of an advanced research qualification, often a PhD. The theoretical duration of these programs is three years, full-time, in most countries (for a cumulative total of at least seven years full-time equivalent at the tertiary level), although the actual enrolment time is typically longer. Programs are devoted to advanced study and original research.

GOVERNMENT EXPENDITURES ON INTRAMURAL RESEARCH AND DEVELOPMENT (GOVERD): R&D performed in the government sector.

GROSS DOMESTIC EXPENDITURES ON RESEARCH AND DEVELOPMENT (GERD): Total intramural expenditures on R&D performed on the national territory during a given period.

GROSS DOMESTIC EXPENDITURES ON RESEARCH AND DEVELOPMENT (GERD) INTENSITY: The ratio of GERD to a measure of output, usually GDP. Also referred to as GERD-to-GDP.

GROSS DOMESTIC PRODUCT (GDP): The total value of all final goods and services produced within a country in a given period of time (usually a calendar year). GDP is reported at both current and constant prices.

GROSS VALUE ADDED: The value of output less the value of intermediate consumption. It is a measure of the contribution to GDP made by an individual producer, industry or sector.

HIGHER EDUCATION EXPENDITURES ON RESEARCH AND DEVELOPMENT (HERD): R&D performed in the higher education sector.

HIGHER EDUCATION EXPENDITURES ON RESEARCH AND DEVELOPMENT (HERD) INTENSITY: The ratio of HERD to a measure of output, usually GDP. Also referred to as HERD-to-GDP.

HIGHER EDUCATION SECTOR: Composed of all universities, colleges of technology and other institutes of post-secondary education, whatever their source of finance or legal status. It also includes all research institutes, experimental stations and clinics operating under the direct control of, administered by, or associated with higher education establishments.

HUMAN RESOURCES IN SCIENCE AND TECHNOLOGY (HRST): Persons having graduated at the tertiary level of education in a science and technology (S&T) field or employed in an S&T occupation for which a high qualification is normally required and the innovation potential is high.

INNOVATION: The process by which individuals, companies and organizations develop, master and use new products, designs, processes and business methods. These can be new to them, if not to their sector, their country or the world. The components of innovation include R&D, invention, capital investment and training and development.

INTANGIBLE ASSETS: Assets that do not have a physical or financial embodiment. Intangible assets have also been referred to as knowledge assets or intellectual capital. Much of the focus on intangibles has been on R&D, key personnel and software.

INTELLECTUAL PROPERTY (IP): A legal concept referring to creations of the mind (e.g., discoveries and inventions) for which exclusive rights are recognized for their owners. Common types of intellectual property rights include, inter alia, copyright, trademarks and patents.

JOB VACANCY RATE: The number of vacant positions divided by total labour demand—that is, occupied positions plus vacant positions. It corresponds to the share of jobs that are unfilled out of all payroll jobs available.

KNOWLEDGE TRANSFER: The process of transferring scientific knowledge from one organization to another for the purpose of commercialization and/or public benefit. It covers a continuum of activities, involving all sectors and actors of the science, technology and innovation ecosystem, in which knowledge is transferred back and forth between knowledge creators and users who convert knowledge into goods, services or innovation.

LABOUR PRODUCTIVITY: Productivity measures the total amount of goods and services produced in a country for each input to production, such as labour, capital or land. The most common measure of productivity is labour productivity, which measures the amount of goods and services produced by one hour of labour.

LICENCE: Agreement with a client to use the institution’s intellectual property for a fee or other consideration, such as equity in a company.

MACHINERY AND EQUIPMENT (M&E): Consists of transport equipment and other M&E other than that acquired by households for final consumption.

MARKET CAPITALIZATION: The share price times the number of shares outstanding. Also known as market value.

MULTIFACTOR PRODUCTIVITY (MFP): Productivity measures the total amount of goods and services produced in a country for each input to production, such as labour, capital or land. Multifactor productivity (MFP) measures the efficiency with which the combined inputs of capital and labour are used in the production process. MFP captures such factors as improvements in technology, economies of scale, capacity utilization and managerial skills.

NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM (NAICS): A system of classification for industries based upon their primary economic activity. The governments of Canada, Mexico, and the United States developed the NAICS Manual, which became effective January 1997.

OPTION: Right to negotiate for a licence.

PERMANENT RESIDENT: An individual who has immigrated to Canada but has not yet become a Canadian citizen. A permanent resident has rights and privileges in Canada even though he/she remains a citizen of the home country. In order to maintain permanent resident status, an individual must fulfill specified residency obligations.

PRODUCTIVITY: Measures the total amount of goods and services produced in a country for each input to production, such as labour, capital or land.

RESEARCH AND DEVELOPMENT (R&D): The OECD’s Frascati Manual (2002) defines R&D to encompass three activities: “‘Basic research’ is experimental or theoretical work undertaken primarily to acquire new knowledge of the underlying foundation of phenomena and observable facts, without any particular application or use in view. ‘Applied research’ is original investigation undertaken in order to acquire new knowledge. It is, however, directed primarily towards a specific practical aim or objective. ‘Experimental development’ is systematic work, drawing on existing knowledge gained from research and/or practical experience, which is directed to producing new materials, products or devices, to installing new processes, systems and services, or to improving substantially those already produced or installed.”202

SUPPLY-PUSH KNOWLEDGE TRANSFER: Model of knowledge transfer where higher education institutions transfer academic inventions to existing firms or to new ventures via the licensing or spinoff of intellectual property.

TRADEMARK: Words, symbols or other marks that are used by firms to distinguish their products or services from those offered by others.

VENTURE CAPITAL (VC): A specialized form of private equity, characterized chiefly by high-risk investment in new or young companies following a growth path in technology and other value-added sectors.

WORK-INTEGRATED LEARNING (WIL): Student employment experiences that add practical employment-based experience to classroom learning or programs of study.


202OECD Frascati Manual: Proposed Standard Practice for Surveys on Research and Experimental Development, Paris (2002), p. 30.