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3.7.Higher education sector

3.7.1. Coverage

206.This sector is composed of:

●All universities, colleges of technology and other institutions 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 or administered by or associated with higher education institutions.

207.This is not an SNA sector. It has been separately identified by the OECD (and by UNESCO) because of the important role played by universities and similar institutions in the performance of R&D.

208.The above definition describes the sector’s general coverage. As it is not backed by SNA, it is difficult to provide clear guidelines that ensure internationally comparable reporting of data. Also, because the criteria are mixed, it is particularly susceptible to variations in interpretation as a result of national policy concerns and definitions of the sector.

209.The core of the sector in all countries is made up of universities and colleges of technology. Where treatment varies, it is with respect to other postsecondary education institutions and above all to several types of institutes linked to universities and colleges. The main problems are considered below:

–Post-secondary education.

–University hospitals and clinics.

–“Borderline” research institutions.

Post-secondary education

210. The sector includes all establishments whose primary activity is to provide post-secondary (tertiary level) education regardless of their legal status. They may be corporations, quasi-corporations belonging to a government unit, market NPIs or NPIs controlled and mainly financed by government or by NPISHs. As noted above, the core is made up of universities and colleges of technology. The number of units in the sector has grown as new universities and specialised post-secondary educational institutions have been set up and secondary level units, some of which may supply education services at both secondary and post-secondary level, have been upgraded. If such units supply post-secondary education as a primary activity, they are

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always part of the higher education sector. If their primary activity is the provision of secondary level education or in-house training they should be allocated by sector in line with the other general rules (market or non-market production, sector of control and institutional funding, etc.).

University hospitals and clinics

211.Inclusion of university hospitals and clinics in the higher education sector is justified both because they are post-secondary educational institutions (teaching hospitals) and because they are research units “associated with” higher education institutions (e.g. advanced medical care in clinics at universities).

212.Academic medical research is traditionally funded from many sources: the institution’s general “block grant” (GUF); the institution’s “own funds”; government funds or private funds, directly or indirectly (via a medical research council, for instance).

213.Where all or nearly all activities in the hospital/medical institution have a teaching/training component, the entire institution should be included as part of the higher education sector. If, on the other hand, only a few of the clinics/departments within a hospital/medical institution have a higher education component, only these teaching/training clinics/departments should be classified in the higher education sector. All other non-teaching/ training clinics/departments should, as a general rule, be included in the appropriate sector (corporations, quasi-corporations belonging to a government unit and market NPIs in the business enterprise sector; NPIs controlled and mainly financed by government in the government sector; NPIs controlled and mainly financed by NPISHs in the PNP sector). Care must be taken to avoid double counting of R&D activities between the sectors concerned.

“Borderline” research institutions

214.Traditionally, universities have been major centres of research, and when countries have wished to expand their R&D in specific fields, universities have frequently been considered appropriate locations for new institutes and units. Most such units are principally government-financed and may even be mission-oriented research units; others are financed by private non-profit sector funds and, more recently, by the business enterprise sector.

215.A particular case arises when special funds are used to set up and finance mainly basic research, which is managed by agencies that not only award grants to universities but also have their “own” research institutes, which may or may not be situated on university campuses. These may be regarded as belonging to the higher education sector.

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216.One factor affecting the classification of such research institutions is the purpose for which the research is being carried out. If the research is predominantly to serve government’s needs, countries may decide to classify the institution in the government sector. This is the case of “mission-oriented” R&D institutes financed from the budget of their sponsoring ministry or department. Alternatively, if the R&D is basic in nature and adds to the general body of a country’s knowledge, some member countries may have opted to classify the institutes in the higher education sector.

217.A higher education institution may have “links” with other research institutes which are not directly concerned with teaching or which have other non-R&D functions such as consulting, for example through the mobility of personnel between the higher education institution and the research institute concerned or the sharing of facilities between institutes classified in different sectors. These institutes may be classified according to other criteria, such as control and finance or service rendered.

218.In some countries, furthermore, borderline institutions may have a private legal status and carry out contract research for other sectors, or they may be government-financed research institutions. It is difficult to decide, in such cases, whether the links between the units are strong enough to justify including the “external” unit in the higher education sector.

219.“Science parks” located at or near universities and colleges, which host a range of manufacturing, service and R&D entities, are a somewhat recent development. For such groupings, it is recommended not to use physical location and use of common resources as a criterion to classify these units in the higher education sector. Units controlled and hosted in these parks and mainly financed by government should be included in the government sector, those controlled and mainly financed by the private non-profit sector should be included in the PNP sector, while enterprises and other units serving enterprises should be classified in the business enterprise sector.

220.Units administered by post-secondary teaching units (including teaching hospitals), as defined above, which are not primarily market producers of R&D, should be included in the higher education sector. This also applies if they are mainly financed from university block grants. If they are primarily market producers of R&D, they should be included in the business enterprise sector despite any links with higher education units; this is particularly relevant for science parks.

221.It is recommended that R&D expenditure and personnel of all institutes at the borderline with the higher education sector be reported separately.

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3.7.2. The principal sector sub-classification

The classification list

222. Statistical units in the higher education sector, like those in the private non-profit sector, are classified into six major fields of science and technology as follows:

–Natural sciences.

–Engineering and technology.

–Medical sciences.

–Agricultural sciences.

–Social sciences.

–Humanities.

223.Table 3.2 gives the major science fields, together with examples of which sub-fields are included.

224.While the major fields of science and technology are clearly defined, the level of disaggregation within each component is left to each country’s discretion. In the higher education sector, where detailed administrative information is available, a detailed field of science classification can be used as an institutional classification.

The statistical unit

225. Since the enterprise-type unit would almost invariably be involved in more than one of the six major fields of science and technology, a smaller statistical unit is necessary. An establishment-type unit is therefore recommended: the smallest homogeneous unit predominantly involved in only one of the six fields and for which a complete (or almost complete) set of factor input data can be obtained. Depending on the size of the institution and national terminology, the statistical unit could be a research institute, a “centre”, a department, a faculty, a hospital or a college.

Criterion for classification

226. The statistical unit should be classified in the field of science or technology which seems to describe most accurately its principal activity as reflected, for example, by the occupations of most of the unit’s professional staff. Where R&D data for this sector are estimates made by the surveying authority, supplementary criteria, such as the institutional location of the unit, may have to be used. Depending on the size and character of the unit, a breakdown of the statistical unit into smaller units corresponding to several relevant major fields of science could be used.

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