Scholarship and Inventive Activity in the University: Complements or Substitutes? Brent Goldfarb University of Maryland Gerald Marschke University at Albany, State University of New York Institute for the Study of Labor (IZA) Amy Smith University at Albany, State University of New York EPFL: September 30, 2006
Motivation Involvement of industry in University-based scientific research is on the rise: Have academics’ inventive and commercialization activities inhibited academic scholarship? (Guena & Nesta 2003; Mowery et al. 2001; Stokes 1997; Nelson & Romer 1996)
Important Question • Historically, university research important to U.S. economic growth (e.g., Jaffe, 1989; Nelson and Rosenberg, 1993; Henderson, Jaffe et al., 1998). • Between 1975-78, annual social rate of return to university research 28% (??) (Mansfield, 1991). • Increase in inventive and commercialization activity in US universities (Henderson, Jaffe, et al 1998; Thursby and Kemp, 2001; Kenney, 1986; Argyres and Liebeskind, 1998; Owen-Smith and Powell, 2001).
Data • 11 year panel (1990-2000) • Stanford University research scientists (Biochemistry & Electrical Engineering) • Stanford is the Canary in the Mineshaft
Findings Inventive activity increases publication quality (not quantity) in biochemistry. Weak relation in engineering.
Advances • Instruments • Venture capital outlays in scientist’s area • Inventive activity of others in department • Better Econometrics • Wooldridge quasi-differencing transformation to remove fixed effects • Disclosures not patents • Control for teaching
Data and methods • Using scientist-level data we estimate: Invention endogenous Instruments: Effort demand shifter: affect inventor effort towards inventive and commercialization relative to publication output.
Count data specification Wooldridge quasi-differencing to remove fixed effects:
Data • Tenure-track faculty in Stanford’s Electrical Engineering and Biochemistry Departments between 1990 and 2000. • EE: 57 inventors, 197 inventions, 1362 pubs • Biochemistry: 15 inventors, 52 inventions, 592 pubs • Teaching histories • Venture capital outlays by broad industrial category • Sources: • ISI Web of Science • ISI’s Science Citation Index, weighted by journal’s citation index • Stanford University Records (OTL, Catalogues) • Venture Economics Database
Electrical Engineering: • All models include fixed effects, year dummies, tenure status, lagged weighted publications, and an intercept
Biochemistry: • All models include fixed effects, year dummies, tenure status, lagged weighted publications, and an intercept
Results • Each invention increases weighted pubs • 40%-80% in biochemistry (mean = 34) • Not robust but: • 10% in electrical engineering (mean = 5.2) • Teaching complementary in EE only (maybe substitute in biochemistry?) • Licenses (commercialization activities) complement publishing in biochemistry
Conclusions • Commercialization concerns overblown Interpretation: • Maybe just life sciences are more likely in Pasteur’s Quadrant and quality researchers excel in both.