Poland faces a choice over a new development model for science

This article is a part of Poland Unpacked. Weekly intelligence for decision-makers

Poland’s current level of spending on R&D is below the EU average. The experience of other countries suggests that the business ecosystem matters more than public spending alone. Here are eight charts illustrating expenditure on research and development.

A proposal to increase Poland’s spending on research and development (R&D) to 3% of GDP by 2030 is gaining momentum. Other demands are also being put forward: a minimum salary for PhD holders employed in academic positions set at no less than the average wage in the corporate sector, along with annual indexation in line with wage growth in that sector.

Additional proposals include setting doctoral scholarships at no less than the statutory minimum wage and allowing doctoral candidates to be employed under regular employment contracts. There is also a call to allocate an additional PLN 1bn (EUR 230m) in the 2027 budget for the National Science Centre (NCN), followed by a growth path in subsequent budgets that would ensure a 25% success rate in NCN grant competitions.

In the analysis below, we place some of these proposals in the context of the data, tracing the evolution of R&D spending in Poland since 1995. An important point is that, in the statistics of international institutions referenced by the proposal, R&D expenditure consists of both public and private-sector funding. For this reason, the authors of the proposal stress that the aim is not only direct budgetary spending, but also systemic incentives encouraging businesses to continue investing in research and development.

1. Poland’s spending on research and development is lower than in the EU as a whole, but close to the regional average

Poland’s R&D expenditure amounted to 1.41% of GDP in 2024. That was well below the EU average of 2.24% of GDP, but slightly above the average for Central and Eastern Europe, which stood at 1.33% of GDP. The Nordic countries top the ranking, each devoting more than 3% of GDP to R&D, alongside Germany, Austria and Belgium. The region also includes countries with substantial R&D spending, notably Slovenia, Estonia and Czechia, where expenditure ranges between 1.8% and 2.2% of GDP.

At the other end of the scale are Romania and Bulgaria, as well as the EU’s smaller island states, Cyprus and Malta, which spend between 0.5% and 0.8% of GDP on R&D. Among the bloc’s larger economies, Italy and Spain also allocate relatively modest shares to research and development, at around 1.4–1.5% of GDP. Ireland is a special case because its GDP figures are distorted relative to other indicators of national wealth.

2. Over the past decade and a half, Poland has been catching up with the EU in R&D spending

The chart below shows the evolution of research and development expenditure in Poland and across the EU since 1995. From Poland’s perspective, two distinct periods stand out. During the first, spanning 1995–2009, Polish R&D spending remained broadly unchanged. Over the same period, average expenditure across the EU rose by around 0.2 percentage points.

After 2009, Poland began rapidly narrowing the gap with the EU average. Domestic R&D spending increased from 0.66% of GDP to the current 1.41% of GDP – an increase of 0.75 percentage points. Over the same period, the EU average rose by only 0.28 percentage points.

A closer look at this second phase shows that Poland was among the EU’s leaders in expanding R&D investment. The chart below compares expenditure across member states in 2009 and 2024, ranked by the largest increase in percentage points. Poland trails only Belgium and Greece. In Greece’s case, however, the low starting point in 2009 was not merely the result of the financial crisis; it had already been a structural feature throughout the first decade of the 21st century.

In a small number of countries, the share of R&D expenditure relative to GDP has actually declined. These tend to be countries that already had very high levels of spending, such as Finland and Denmark, as well as France, which sits close to the EU average. Romania stands out for a different reason: its R&D spending has remained persistently low, at around 0.4–0.5% of GDP, with virtually no change over the past two decades.

3. Poland’s R&D spending is broadly in line with its level of development relative to the EU

The chart below shows a positive correlation across EU countries in 2024 between R&D expenditure and GDP per capita measured at purchasing-power parity. In theory, the relationship may work in both directions. The higher a country’s income per head, the more it can allocate to R&D as a share of GDP. At the same time, higher investment in research and development may itself contribute to higher GDP per capita once differences in local prices are taken into account.

Without drawing firm conclusions about causality, it is worth noting that Poland’s current level of R&D spending broadly matches what would be expected given its GDP per capita at purchasing-power parity. Some countries sit well above the trend line – notably Finland, Sweden, Belgium and Austria – while others, such as Romania and Italy, fall below it.

What would meeting the target of raising R&D spending in Poland to 3% of GDP by 2030 actually look like? The chart below illustrates the scenario, taking into account projected real GDP growth through to 2030, recalculated in 2024 terms. Poland would end up significantly above the trend line.

That does not in itself invalidate the proposal, but it does place it in the proper context. It would mean Poland choosing to prioritize science and research far more heavily than most other countries – a shift in the country’s development model. And such a change inevitably carries consequences when resources are finite.

4. On the impact of R&D on development

A large body of research has attempted to demonstrate a causal link between R&D spending and economic growth. The broad consensus among economists is that such spending does have a positive effect. What differs across studies is usually the scale of that effect.

First, the impact depends on factors such as institutional quality, educational attainment and openness to international trade. It also varies according to a country’s level of development and its distance from the technological frontier. Private-sector R&D spending tends to have a stronger short-term effect, while public expenditure is generally more important over the long run. A country’s ability to benefit from R&D investment also depends on how effectively it can commercialize research. Some scholars additionally point to diminishing – though still positive – marginal returns at very high levels of spending.

The complexity of this relationship is illustrated by Finland. The country’s period of rapid economic growth coincided with a sharp increase in R&D expenditure. Between 1995 and 2008, spending rose from 2.2% of GDP to 3.5%, with businesses accounting for more than 90% of the increase. Since then, expenditure has declined, although it remains relatively high at around 2.8–3.2% of GDP. Meanwhile, Finland’s GDP per capita has fallen back towards the EU average.

Yet there were at least several reasons for this. The question of cause and effect also remains open: was the decline in R&D spending itself a consequence of Finland’s “Nokia moment” and the loss of market share in mobile phones?

5. Poland’s public spending on R&D is broadly aligned with – though slightly below – its level of development relative to the EU

It is, of course, easier for governments to influence areas that fall directly under their control, namely public expenditure. In the case of corporate R&D spending, the state can shape incentives through policy, but the final investment decisions ultimately rest with businesses themselves.

The chart above compares public R&D expenditure across EU countries in 2024 – covering both government-sector research and higher-education R&D – against GDP per capita. With spending at 0.5% of GDP, Poland sits slightly below the trend line, suggesting there may be room for higher public investment in this area.

Alongside the countries that have traditionally stood out for high levels of public R&D spending, Estonia is also notable within the region, allocating around 0.8% of GDP to the sector.

Yet increasing public expenditure alone will not solve the challenge of substantially raising total R&D investment. The reason is straightforward: the higher overall spending becomes, the greater the share contributed by businesses. The chart below illustrates this relationship.

In countries with the highest R&D expenditure relative to GDP – such as Israel, Taiwan and South Korea – private-sector spending accounts for 80–90% of the total. In other leading economies, including the United States, Japan, Sweden and China, the corporate share stands at 75–80%.

In Poland, businesses account for 63% of total R&D spending. That is considerably lower, though still slightly above what Poland’s level of income per capita within the EU might suggest. In other words, any significant increase in Polish R&D expenditure would require the private sector to do most of the heavy lifting.

The detailed proposals currently under discussion, however, focus primarily on the public sector. No OECD country allocates more than 1.1% of GDP in public funds to R&D – the highest level being Denmark’s.

7. The private sector is key…

The analysis above suggests that Poland’s R&D spending is broadly consistent with its level of development relative to other EU countries. Moreover, the increase recorded over the past decade and a half has been among the strongest in the bloc. That observation does not, however, rule out further growth in spending. Part of this process occurs naturally in any case: as real GDP rises, countries generally devote a larger share of resources to research and development.

At the same time, the analysis also makes clear that most of the burden will ultimately fall on the private sector. The state can create an institutional framework that gives companies the right incentives to increase investment, but businesses themselves will remain the decisive force behind any major expansion in R&D spending.

…while the constraints lie in the public sector

There appears to be both room and a need for a gradual increase in public R&D spending as well. Any such move, however, should be calibrated to the fiscal challenges Poland currently faces. And policymakers should keep in mind that corporate expenditure accounts for 75–90% of total R&D spending in the world’s leading innovation economies.

The idea of automatically linking salary indexation in academia to the average wage level does not strike me as particularly wise. Poland has effectively been testing a similar mechanism in healthcare for several years, and the result appears to have been higher spending without a corresponding increase in the number of services delivered. Another counterargument is that, according to Eurostat’s COFOG classification, Poland already allocates a larger share of GDP to higher education than the EU average – 1.3% versus 0.8%.

In my view, more sensible proposals would include increasing funding for the National Science Centre (NCN) and supporting researchers who are more exposed to competition on the global scientific market.

One of the first things students learn at university is to compare like with like. That is why I find comparisons between minimum gross salaries in a given profession and average wages across the economy somewhat misleading. Academic staff in Poland can apply a 50% tax-deductible expense allowance, which means that, for the same gross salary, they take home a higher net income.

There is also the separate issue of using minimum rather than average salaries as the benchmark. But that is a broader systemic problem linked to the lack of pay transparency across many public-sector professions. What matters more is ensuring that science attracts talent and strengthening incentives for those pursuing doctoral studies.

Poland spends less on research and development than the EU average, but it is rapidly narrowing the gap with more advanced economies. In 2024, Polish R&D expenditure amounted to 1.41% of GDP, compared with an EU average of 2.24%. At the same time, Poland outperformed the average for Central and Eastern Europe. The leaders remain the Nordic countries, along with Germany, Austria and Belgium, where R&D spending exceeds 3% of GDP.
Between 1995 and 2009, Poland’s spending on research and development remained broadly unchanged and lagged well behind the EU average. The turning point came after 2009, when R&D expenditure began to rise rapidly. Its share of GDP increased from 0.66% in 2009 to 1.41% in 2024 – an increase of 0.75 percentage points. The pace of growth was among the fastest in the European Union, surpassed only by Belgium and Greece. As a result, Poland gradually narrowed the gap with the EU average, although it still remains below it in terms of R&D spending as a share of GDP.
In countries with the highest levels of R&D expenditure – such as Israel, South Korea, Taiwan, the United States and Sweden – around 70–90% of spending comes from the private sector. In Poland, businesses account for roughly 63% of total R&D expenditure. This means that even a substantial increase in public spending would not be enough without a corresponding rise in corporate investment. In practice, the private sector would have to bear most of the burden of reaching the 3%-of-GDP target, while the state can primarily provide incentives and an institutional framework to support such investment.