New Zealand's world ranking for research and development spending continues to drop, despite increased incentives for companies to invest, according to a report by Grant Thornton, which puts New Zealand near the bottom of the table.

Paul Kane, spokesman for the global business consultancy, said the number of companies in New Zealand that expected to increase their spending on research and development had dropped significantly, with just 12 per cent of firms expecting to increase their spending in the next year.

"We're really at the bottom of the table, we're fourth from the bottom behind Estonia, Argentina and Russia, and we've been steadily dropping," Kane said.

"Back in the third quarter of 2012, we were at around 38 per cent expectancy from companies that they would spend more on R&D in the next 12 months and that's really just dropped down continuously every quarter," he said.

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"And now we're at around 12 per cent."

Economic Development Minister Steven Joyce dismissed the report, saying the survey did not reflect what he had been seeing in New Zealand.

"Take the TIN100 that was out a couple of weeks ago, according to that survey, the top 100 technology companies R&D is up 10 per cent in the last year alone, and the last public survey we have, a robust one from Stats, has us lifting R&D from 0.5 to 0.58 [per cent] of GDP and significant attempts to increase it further," Joyce said.

But according to Kane, the effects of lower R&D spend was being hidden by confidence in the market.

"Where we're sitting at the moment with a good economic position ... so it's all really just hiding the fact that we're not looking to spend a lot on R&D," he said.