Economic performance measures for evaluating government-sponsored research

The purpose of this paper is to discuss, in general terms, evaluation issues related to government-sponsored research and to describe and critique the usefulness of economic performance measures for evaluating such activity. Herein is presented an overview of the economic justification for government-sponsored research and the rationale for its evaluation. Also, fundamental evaluation methods are described. The paper ends with a recommendation that benefit-cost analysis may be the most appropriate economic performance measure when evaluating government-sponsored research if used cautiously and with an understanding of its inherent subjectivity.