Transformation of public research funding systems in central and eastern Europe (CEE) represent a natural experiment whereby different funding systems have developed from relatively common heritage of the socialist system. In this introduction that builds on the three papers of this thematic issue we argue that in medium and long-term the key challenge of CEE countries' research funding systems is to achieve balance between scientific excellence (static allocative efficiency) and socio-economic relevance (dynamic efficiency). The achievement of this trade-off is an institutional issue par excellence; it does not represent optimum but contextual fit, and is determined through interaction of macro funding rules and market structure of the research system. In order to evaluate this fit we should approach research funding as a multifaceted process composed of functional, path-dependent and political as well as learning dimension
