Research and development

general term for activities in connection with corporate or governmental innovation

Research and development (R&D) refers to a wide range of activities by businesses, governments and academic institutions designed to gather knowledge and test new ideas.[1] This often leads to the development of new products or new ways of doing things.[2][3] R&D generally has three main activities.[4] These are: basic research, applied research and development.[4] Basic research is aimed at getting new knowledge with no immediate use or purpose in mind.[4] Applied research is just the opposite. It is research for a definite purpose or product.[4] Development has more to do with adding features to a product. Often, development is a process of eliminating all but the best idea to arrive at the best solution.[5] Basic and applied research costs are often written off as expenses while the costs of development are added to the cost of the product.[6] R&D often results in owning intellectual property such as patents.[6] In Europe, R&D is called research and technical/technological development (RTD).[3]

In 2015, Volkswagen was the world's leading spender in R&D[7]


  1. Rodney Michael. "What is Research and Development? - Definition, Methods & Examples". Retrieved 11 October 2016.
  2. Wragg, David W. (1973). A Dictionary of Aviation (first ed.). Osprey. p. 223. ISBN 9780850451634.
  3. 3.0 3.1 "Research And Development - R&D". Investopedia. Retrieved 11 October 2016.
  4. 4.0 4.1 4.2 4.3 Bronwyn H. Hall (December 2006). "Research and Development" (PDF). Economics Laboratory, University of California; Berkeley. Retrieved 11 October 2016.
  5. Bradford Goldense (16 September 2014). "What's The Difference Between Research and Development?". Machine Design. Penton. Retrieved 11 October 2016.
  6. 6.0 6.1 "research and development (R&D)". Business Dictionary. WebFinance Inc. Archived from the original on 19 October 2016. Retrieved 11 October 2016.
  7. "The top innovators and spenders". Strategy&. PwC. Retrieved 11 October 2016.

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