ABSTRACT
This chapter presents to shed some light on the research and development (R&D) diffuser role that some service industries, the knowledge intensive services (KIS), are playing within production systems. Specifically, the KIS have three main ways of contributing to the knowledge base: developing original innovations, diffusing knowledge and surpassing the problem of human capital indivisibilities. The well-known work of Allison Young, where several Organization for Economic Cooperation and Development (OECD) databases are combined in order to analyse the evolution of R&D expenditures in service industries, demonstrates that many of the differences in R&D intensities growth rates are caused by discrepancies in the statistical coverage. KIS are ever more involved in the development of R&D activities, as shown by the great growth rates of their expenditures on research and development during the second half of the nineties. Thus, for example, in the European Union the growth rate of R&D in services was three times the R&D growth rate in manufacturing.
