SUMMARY
This article is resting on the theoretical model of Braun (2003) describing the delegation modes for public funding of research in the principal-agent framework. It aims to show by using the conceptualisation of utility functions of principal and agents on the various levels, how different motivations for producing different kinds of research outputs emerge for researchers and universities or public research organisations in Estonia and Ukraine. The article attempts to offer one explanation to why in some quantitative research output indicators both countries perform very well compared to much lower levels of innovation system indicators otherwise. Estonia is rewarding publications and Ukraine is rewarding utility model applications throughout different levels of the system.