Classification of research and development funder and performer sectors

1 - Total government

The OECD definition of this sector is: "All departments, offices and other bodies which furnish but normally do not sell to the community those common services which cannot otherwise be conveniently and economically provided and administer the state and the economic and social policy of the community.

Public enterprises such as Petro-Canada and Ontario Hydro are excluded from this sector and included in the Business enterprise sector. Many non-profit organizations and bodies, however, are included in this sector if they either serve or are controlled by government, or both.

In Canada the distribution of Gross domestic expenditures on research and development (GERD) amongst the government sub-sectors are published. The sub-sectors are the federal government, the provincial governments and the provincial research organizations (PRO's). Currently Canada has seven PRO's. They are the New Brunswick Research and Productivity Council, the "Centre de recherche industrielle du Québec (CRIQ)", the Industrial Technology Centre (Manitoba), the Saskatchewan Research Council, the Yukon Research Institute, the NUNAVUT Research Institute and the Aurora Research Institute.

2 - Business enterprise

This sector is composed of all firms, organizations and institutions whose primary activity is the production of goods or services for sale to the general public at a price intended approximately to cover at least the cost of production as well as non-profit institutes serving such firms. Included are government-owned enterprises such as Ontario Hydro and Canadian National Railways.

3 - Higher education

This sector is composed of all universities, colleges of technology and other institutes 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 higher education establishments.

4 - Private non-profit and other sources

This sector comprises private or semi-private organizations which are not established primarily with the aim of making a profit.

It consists of voluntary associations (scientific and professional societies, health-oriented groups), philanthropic foundations and research institutes supported by the associations and foundations. These kinds of institutions are usually maintained by fees, dues and donations from members and sponsors and by grants from governments and enterprises. They may also obtain revenue from the sale of their products such as publications or special studies.

Non-profit institutes and organizations excluded from this sector are those which are controlled by enterprises, government, or higher education. Such non-profit institutes and organizations are included with the respective sectors whose interests they mainly serve.

5 - Foreign funding

This sector consists of: "All institutions and individuals located outside the political frontiers of a country except for vehicles, ships, aircraft and space satellites operated by domestic organizations and testing grounds acquired by such organizations.

This sector also includes international organizations whose facilities and operations are situated inside the borders of a country. Foreign-owned subsidiaries are not included in this sector (e.g., Ford Canada is, for the purposes for measuring R&D expenditures, a domestic organization in the Canadian business enterprise sector, even though its parent company is the Ford Motor Company of the United States).

The Foreign sector is included in the GERD only as a funding sector (see matrix), since by definition the GERD includes R&D performed within a country and funded from abroad but excludes payments made abroad for R&D. Thus, funding from the foreign sector is implicitly included in the intramural expenditures of the four performing sectors.