Round Table

Beyond the Crisis: Funding Research Universities in Economic Recession

3-4 December 2010
The Conference Hall of the Rectorate, University of Zagreb

Financial Management of a
Public Research Institute in Economic Recession

Sandra Švaljek,
The Institute of Economics, Zagreb

1
 The Institute of Economics, Zagreb at a glance

 A public scientific institute

 Founded in 1939
 Conducts scientific and development research in the field of
economics

 ± 65 employees
□ 25 researchers
□ 15 research assistants
□ 25 employees in service departments

 ~ 60% of financing → public funds

 ~ 40% → commissioned projects
□ Clients:
 Ministries, state agencies and offices
 Units of local and regional self-government
 Public and private companies
 Croatian National Bank
 World Bank
 European Commission
 Other international organizations

2
 Events and publications

Events:
□ Science Tuesdays
(public presentations of research findings and
discussions about current scientific topics)
□ Scientific conferences and workshops
Serial publications:
□ Economic Trends and Economic Policy
□ Croatian Economic Outlook Quarterly
□ Croatian Economic Survey
□ EIZ Working Papers
Other publications:
□ Project studies
□ Conference proceedings
□ Books
□ Methodological guidelines

3
www.eizg.hr
The Institute of Economics, Zagreb
Trg J. F. Kennedyja 7
HR-10000 Zagreb
Tel: +385 1 2362 200
Fax: +385 1 2335 165
e-mail: eizagreb@eizg.hr

4
 Financial position of the EIZ, 2005-2010
Figure 1: Revenues from MSES and revenues from projects, 2005=100
160

140

120

100

80

60

40

20

0
2005 2006 2007 2008 2009 2010

FUNDING FROM THE MINISTRY OF SCIENCE, EDUCATION AND SPORTS

REVENUES FROM PROJECTS

 From 2005 to 2010 total funding of the Institute was relatively stable, but the stability of revenues
was preserved mainly thanks to the increase of funding from the Ministry of Science, Education
and Sports.
 Revenues from projects have sharply declined, and so has their ratio in total revenues.

5
 Financial position of the EIZ, 2005-2010

Figure 3: Structure of the funding from the Ministry of Science, Education and Sports

100%

80%

60%

40%

20%

81.0 83.7 87.4 87.6 88.7 89.6

0%
2005 2006 2007 2008 2009 2010

Salaries and other expenses of the personnel Operating costs

Research projects Journals and scientific equipment
Other revenues

 However, the structure of funding from the MSES has changed – an increasing share of funding
from MSES was dedicated to salaries and other expenses of the personnel
 Funding for the procurement of journals and scientific equipment has disappeared, while funding
for research projects became negligible
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 Financial position of the EIZ, 2005-2010

Figure 3: Funding of the research projects, 2005=100

200

180

160

140

120

100

80

60

40

20

0
2006 2007 2008 2009 2010
MINISTRY OF SCIENCE, EDUCATION AND SPORTS
State budget sources (ministries, agencies)
Business sector and public companies
Non-profit institutions, chambers, associations (Local gov. Budget included)
EU funds and other international institutions

 Structure of the funding of the research project was strongly affected by the recession.
 Funding from the state budget sources, MSES and business sector declined significantly.
 Funding from EU funds and other international institutions remained quite stable.
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 Procurement of journals and books

Total Covered by Total Total  Due to much scarcer financial

Year foreign MSES national journals resources the Institute had to cut its
costs
2005 167 78 88 167  Procurement of journals and books
2006 100 56 67 167 had to be reduced accordingly
 Other costs have been reduced, too
2007 92 56 66 158
(procurement of equipment,
2009 86 0 65 151 maintenance, telecommunication
services etc.)

Means of
procurement Own Procured in
/ Year Purchase Gift/Exchange publication Total total
2005 219 259 3 481  
2006 133 158 0 281  
2007 139 153 2 294  
2008 119 69 3 188  
2009 62 110 3 173  
Total 672 749 11 1417 2849
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 What have we learned from crisis?

 Production of publications per researcher is positively correlated with the

funding of research projects per researcher
 Therefore, stability of research funding has to be preserved regardless
of the phase of the business cycle
 The Institute has to potential to compete for more stable international
sources of research funding and has to invest further in its capacity to
engage in international research projects
 The Institute has to establish stronger links with the business community