This paper analyzes the Swedish system of higher education and research with respect to the allocation of research resources. The main findings are a considerable expansion of the system since the post war era as well as a strong trend towards decentralization during the last decades. The earlier visible hand of close governance has left power to an invisible hand of market governance. Also, methods of New Public Management have been introduced. Despite an increasing tendency for research evaluations in Sweden the link to funding has so far been weak, however. Even if resources for research to an increasing extent are allocated through short-term project grants rather than long-term block grants a clear tendency towards funding of fewer and larger programmes rather than many small projects can be observed
