Universities in National Innovation
Systems
David C. Mowery
Haas School of Business, UC
Berkeley
Outline
• Universities and industrial innovation in
knowledge-based economies.
– Cross-national indicators on the structure of national
higher education systems.
– Evidence from U.S. surveys on the contributions of
university research to innovation.
• Case study: The Bayh-Dole Act of 1980.
– Is the US system a “role model”?
– “Emulation” of Bayh-Dole elsewhere in the OECD.
• Managing University-Industry linkages.
Universities within national innovation
systems.
• Universities are among the oldest institutions in
most European economies.
• They are also among the most nationally
idiosyncratic throughout the industrial economies.
• Conceptual frameworks for understanding the role
of universities in industrial innovation:
– “Pasteur’s Quadrant”: basic research that has direct
industrial applications.
– The “republic of science” and contrasting norms of
disclosure and dissemination of research in industry and
academia.
“Pasteur’s quadrant” (PQ) and
academic research
• Stokes (1997) proposed that academic basic
research included 2 broad classes:
– Fundamental knowledge about the universe (“Bohr’s
quadrant”).
– Knowledge flowing from basic research with direct
applications (“Pasteur’s quadrant”).
– 3d quadrant, “Edison”: technological research for
application.
• Recent academic research, esp. in biomedical
fields, frequently yield knowledge in “Pasteur’s
quadrant” (as did Pasteur’s own work).
– Gene-splicing a classic example.
– An input to further basic research and to innovation.
Different rewards & incentives in
industrial and academic research =>
potential conflict in PQ
• Academia: Priority and disclosure are critical to
professional success.
– 1st to publish reaps the majority of the “returns.”
– Publication & disclosure of methods are essential.
• Industry: Returns to innovation operate very
differently.
– Disclosure may be detrimental to innovative success.
– Priority in invention may not be essential to commercial
success.
– Additional investment, innovation often required for
commercial success.
US University performance share of total US basic research, 1953 2009 (inc. FFRDCs)
0.7
0.6
0.5
share
0.4
0.3
0.2
0.1
0
1953 1955 1957 1959 1961 1963 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
year
The rise of the modern research
university
• European universities originally (11th century)
were established as institutions for training clerics.
• Although affiliated with the church, universities
were autonomous entities.
• Through the early 19th century, universities
continued to focus on teaching of future clerics in
Europe, US.
• A new model emerges in mid-19th German states:
the state-funded research university.
• Emulated rapidly in US, elsewhere in continental
Europe.
How do universities influence innovation?
• Multiple roles:
– Source of trained S&Es.
– Combination of research & training => an important
mechanism for knowledge & technology transfer
through flow of graduates to industry.
– Source of peer-reviewed knowledge placed in the
global public domain.
– Magnet for S&E immigrants from diaspora &
elsewhere.
– In some cases, universities support regional hightechnology agglomerations.
• Multiplicity of roles => varied channels through
which universities affect industrial innovation.
Universities and high-tech clusters
• We observe numerous clusters with universities,
but numerous universities without clusters.
– MIT & Stanford appear important to regional clusters,
but “causal” evidence is sketchy.
• Klepper argues that early Silicon Valley resembles Detroit &
auto industry rather than relying on academic institutions.
• Fairchild, IBM in Silicon Valley were very important sources
of spinoffs that (may have) benefited from academic links.
Compare with Stanford role?
– Carnegie-Mellon (Pittsburgh), CWRU (Cleveland),
Johns Hopkins (Baltimore) have spawned less powerful
clusters.
• Universities’ role in sustaining clusters may differ
from role in catalyzing their creation.
• Regional firms’ role also may differ over time.
Comparing higher ed. systems
• Most systems combine education & training in
varying degrees and occupy positions of varying
prominence in these functions within different
national economies.
• How do national systems of higher education
differ in the following dimensions?
–
–
–
–
Scale
Contributions to training of scientists & engineers.
Performance of R&D within the national economy.
Mix of public, industrial funds in university research
support.
– Centralized vs. decentralized national structure of
administration.
Indicators of university-industry
linkages within the OECD
• Few internationally comparable measures of collaboration,
technology transfer:
– Patent counts do not adjust for quality of patents, incentives of university
administrators to seek patents.
– No internationally comparable university licensing data.
• US widely cited as a model of close collaboration, but (fundingbased) indicators do not rank US at the top of the OECD:
– University share of national R&D performance.
– Industry-funded share of university R&D performance (Germany 1st,
Canada 2nd), which in US is lower in 2008 than in 1953.
• Crespi et al. (2006): majority of faculty patents in UK, France, Italy,
Germany, Netherlands, Spain are not assigned to universities.
• Context and structure supporting linkages are more complex
than indicators can convey.
– OECD report (2002): qualitative evidence => labor mobility between US
higher education and industry is greater than in other national higher ed.
systems.
• At least some important influences on U-I links are outside of
university boundaries.
– Labor markets for scientists and engineers.
– Venture capital.
Figure 1: University-performed R&D % of total national R&D, 1996 - 2009
45
40
35
30
25
20
15
10
5
0
1996
1997
USA
1998
Canada
1999
France
2000
Germany
2001
Italy
2002
2003
Netherlands
2004
Sweden
2005
UK
2006
Japan
2007
FInland
2008
2009
Norway
Figure 2: Share of higher ed R&D financed by industry, 1996-2009
18
16
14
12
10
8
6
4
2
0
1996
1997
USA
1998
Canada
1999
France
2000
Germany
2001
Italy
2002
2003
Netherlands
2004
Sweden
2005
UK
2006
Japan
2007
Finland
2008
2009
Norway
Industry-funded share of total US academic R&D, 1953 - 2008 (exc. FFRDCs)
0.07
0.06
0.05
share (%)
0.04
0.03
0.02
0.01
0
year
Channels of interaction between academic
research and industrial innovation
• Multiple channels of interaction (training; publishing;
faculty consulting; new-firm formation; patents &
licenses).
• The interaction is bidirectional: industrial
research/innovation affects academic research, as well as
the reverse.
– Schockley Semiconductor and Stanford.
• Importance of different channels varies among fields of
research.
• Outside of pharmaceuticals, US industrial R&D managers
in large firms indicate that patents are relatively
unimportant channels of influence.
Little work on relationship among channels of
interaction
• How important are different channels to different
university missions?
• Little work on role of licensing in “spinoff” formation,
survival.
• Most work on patenting & publishing concludes that
patenters also are publishers.
• Gender and patenting: Senior female faculty publish
comparably, patent far less than male faculty of similar
rank and productivity in US universities.
• Ding and Choi (2009): Younger US faculty in
biomedical research are more likely to pursue new-firm
entrepreneurship at an early point in their career.
• We know little about relative importance of these, other
channels of interaction in different national university,
innovation systems.
CASE STUDY: THE U.S. BAYHDOLE ACT OF 1980 AND
POLICY EMULATION
Policy “emulation” and universityindustry links in OECD economies
• “Systems of innovation” literature rarely considers
interaction among different national systems.
– “evolutionary”: cross-border flows of capital,
technology => some requirement for adaptation,
reflecting competitive pressure.
– “purposive”: policymakers “learn” from one another’s
policies.
• “Purposive” interaction => conscious “emulation.”
• OECD members’ evolving policies toward
university-industry interaction an example of
“purposive” interaction, emulation.
International “emulation” in technology
policy
• Examples:
– R&D collaboration (EU, US emulated Japanese
collaboration in the 1980s; Japan now emulates
SEMATECH in ASET, SELETE).
– Deregulation.
– Intellectual property rights.
– Venture capital.
• Characteristics:
– Learning is selective. Implementation of the
imitative/emulative response further muddles the
fidelity of the “reflection.”
– International emulation of Bayh-Dole shares these
characteristics.
The Bayh-Dole Act of 1980
• Act sought to encourage commercial development of
federally funded inventions in university and government
labs.
• Rationalized and simplified federal policy toward
assignment of patent rights, licensing.
– Political statement as important as statutory provisions.
• Bayh-Dole did not legalize anything previously prohibited.
It replaced a complex web of Institutional Patent
Agreements (IPAs) between individual federal agencies
and universities.
• Act delegated management to research performers and
reduced agency oversight of licensing of federally funded
research results.
Other developments during the 1970s and
1980s influenced US universities.
• Diamond v. Chakrabarty: Life forms are deemed
patentable by the US Supreme Court in 1980.
• Creation of the Court of Appeals for the Federal
Circuit in 1982. The Court becomes a strong
“pro-patentholder” judicial body.
• Other federal actions strengthen intellectual
property protection in domestic, international
economy during the 1980s.
• “War on Cancer” spurs research in molecular
biology.
International “emulation” of the BayhDole Act.
• Discussions or policy changes affecting “technology
transfer” activities of national universities in Japan;
Italy; Germany; Denmark; France; Canada, and other
nations.
– Bayh-Dole widely cited as a model.
• Many policy initiatives focus on patenting of
university inventions.
– Transfer ownership of patent rights from faculty to
university (Denmark; Germany).
– Transfer ownership of patent rights from university to
individual faculty (Italy).
• Some initiatives (Sweden, Japan) include authority or
public financial support for creation of “technology
transfer offices.”
– Others (France) liberalize leave-of-absence policies for
gov’t and university researchers to start new firms.
But several issues have not been
addressed
• How important has the Bayh-Dole Act been in
supporting university-industry collaboration and
technology transfer in the United States?
– Would growth in these activities have occurred without
the Bayh-Dole Act?
• Will emulation of the Bayh-Dole Act accelerate
collaboration and technology transfer in other
nations’ university systems?
– What side effects for academic research?
Structural characteristics of US higher
education created incentives for technology
transfer before 1980
• Large scale of national “system.”
• No centralized (e.g.,federal) control of administrative
policies.
• Heterogeneous institutional structure (public; private;
secular; religious; large; small) and quality.
• Dependence by many institutions on “local” sources of
financial & political support.
– This dependence motivated research with “local” benefits, search
for links with “local” industry.
• Inter-institutional competition for resources, prestige,
faculty.
• Aghion et al. (2009), Katz & Goldin (2008): Institutional
autonomy => higher performance among US universities.
US university patenting before BayhDole
• Many U.S. universities avoided a direct role in
management of patenting, licensing.
– UCB inventor Cottrell founded the Research Corporation in
1912 as a specialized patent-licensing manager.
• Federal research funding agencies developed
accommodative policies in the form of Institutional
Patent Agreements (IPAs) in the late 1960s.
• Significant change in the 1970s:
– Biomedical technologies’ share of US university patents
increased from 17% in 1971 to more than 30% in 1980.
– Private universities’ share of US university patenting more
than tripled during 1960-80, growing from 14% in 1960 to
45% in 1980.
– Universities became more active managers of patenting &
licensing during the 1970s, using IPAs.
University patents by class, 1970-95
0.45
0.4
0.35
0.25
Chemicals
Drugs/medical
electrical/electronic
mechanical
0.2
0.15
0.1
0.05
0
19
70
19
71
19
72
19
73
19
74
19
75
19
76
19
77
19
78
19
79
19
80
19
81
19
82
19
83
19
84
19
85
19
86
19
87
19
88
19
89
19
90
19
91
19
92
19
93
19
94
share (%)
0.3
year
Tensions between universities active in
patenting and federal agencies led to
passage of Bayh-Dole in 1980
• HEW (parent of NIH) considered limitations on use of
exclusive licensing agreements for NIH-funded
inventions under IPAs.
• In response, universities (led by Purdue, Stanford,
MIT, Harvard, Columbia) lobbied for flexibility and
consistency (and tolerance for exclusive licensing
agreements) in federal policy.
– University efforts were influential in a period of concern
over (apparently) declining U.S. competitiveness.
• Bayh-Dole thus is an effect of growth in US university
patenting during the 70s, as well as one of several
causes of increased academic patenting during the 80s.
Post-Bayh-Dole trends
• University share of all US patents grew from 0.5% in 1980 to
>4% by 2008.
– US universities account for as much as 11% of “biotechnology”
patents by 2000.
• Entry into patenting by universities with limited pre-1980
experience.
– Academic institutions receiving 10 or fewer patents during 1970-1980
increased their share of total patenting from 15% during this period to
36% by 1992.
• Entrant universities received “lower-quality” patents initially,
closed “quality gap” with experienced institutional patenters by
early 1990s.
– Underscores complexity, difficulty of “learning to patent” in university
OTTs.
– Simple patent counts are poor performance measures.
• Although “university spinoffs” are widely cited, new firms
account for less than 20% of US university licensees.
• Industry-funded share of total university research in U.S. grew
from roughly 3.9% in 1980 to 6.9% in 1995, 7.4% in 1999,
drops to 5.1% in 2008.
US research univ. patents % of all domestic-assignee US patents, 1963 - 99
0.04
0.035
0.03
0.02
0.015
0.01
0.005
year
99
19
97
19
95
19
93
19
91
19
89
19
87
19
85
19
83
19
81
19
79
19
77
19
75
19
73
19
71
19
69
19
67
19
65
19
63
0
19
share
0.025
Summary: The effects of Bayh-Dole
in the United States
• Much of the growth in patenting & licensing
would have occurred without Bayh-Dole:
– Growth in biomedical research funding and discoveries.
– Broader strengthening of federal intellectual property
rights.
• Growth in other forms of research collaboration is
less apparent.
• Other forms of university-industry research
collaboration have a long history in the United
States and rely on other characteristics of the
system.
• Growth in patenting and licensing has been
heavily concentrated in biomedical technologies.
Managing University-Industry
Linkages
US university management of IP
• For many US universities, net licensing revenues are
modest (or negative).
– U of California systemwide gross revenues averaged
US$99M/year for FY 2001 – 2006; net licensing revenue
averaged US$28M/year.
• Industry-funded research exceeded $200M during FY 2006.
– Licensing revenues dominated by small # of patents, typically in
biomedical field.
• Other (non-revenue) motives for university patenting:
–
–
–
–
Faculty pressure.
Economic development/technology transfer.
Funding of research by industrial collaborators/licensees.
“Research freedom,” especially in the absence of “experimental
use” infringement defense.
– Different goals => different policies, performance measures.
– University administrators often are not clear about priorities,
unrealistic about potential licensing revenues.
• Fixed costs, operating expenses of TTOs are high.
– Does every university need an independent TTO? Considerable
scope for multi-institutional collaboration.
Does university patenting affect research
content and exploitation?
• Does greater emphasis on one channel of universityindustry interaction have a chilling effect on others?
– Little evidence that faculty patenters publish less.
• Is increased academic patenting (for many reasons beyond
Bayh-Dole) impeding science? Evidence is inconclusive.
– Cohen et al. (2006): Academics are not constrained by
patents.
– Murray & Stern (2009): Patented discoveries experience
relative decline in citations.
– Sampat et al. (2003): Slowdown in citations to university
patents since 1980; slowdown is greatest for industry
citations to university patents (Fabrizio, 2007).
• Are Material Transfer Agreements (MTAs) linked to
patenting (yes); do they impede sharing of results
(possibly)?
– Cohen et al. (2007): Denial of access to materials impedes
academic research, and MTAs often cover research tools.
– Delays are common in negotiation, approval of MTAs.
•
•
•
•
•
•
•
•
How do firms link to university
research?
Funding
Consulting
Hiring
Collaboration (including sending employees to
academic labs).
Licensing
Virtually all of these (including licensing) require
intrafirm absorptive capacity.
Very little research on determinants of firms’
ability to “tap into” university research.
What does “tapping into” mean? Recognition of
opportunity? Refining research agenda?
Gov’t., industry criticism of US universities
• Universities’ emphasis on patenting => frictions with some
non-biomedical firms.
– Hewlett-Packard cited “less restrictive” IPR regime in non-U.S.
universities in expanding foreign research collaboration.
• National Institutes of Health efforts to standardize,
simplify MTAs have encountered resistance from
universities.
– “…universities take inconsistent positions on fair terms of access
to research tools depending on whether they are importing tools or
exporting them.” (Working Group on Research Tools, 1998).
• Late-2010 National Academy of Sciences report:
– “Patenting and licensing practices should not be predicated on the
goal of raising significant revenue for the institution. The
likelihood of success is small, the probability of disappointed
expectations high, and the risk of distorting and narrowing
dissemination efforts is great.”
Some US universities have developed less
“patent-centric” policies
• Gradual shift to recognize that:
– Licensing revenues may not be either large or worth the
expense and conflict with industry.
– Much academic research does not resemble the biomedical
field.
• Patents are less valuable, lucrative sources of licensing
revenues.
• Both Stanford, UCB now emulate MIT in combining
management of IP with industrial liaison activities
supporting industry-sponsored research.
• New policies have reduced universities’ emphasis on
ownership of tangible IP from IT industry collaborations.
– December 2005 “Open Collaboration Principles” agreement
between 7 research universities and 4 IT firms.
Conclusion
• Bayh-Dole extended, rather than creating a “new era”
in US university patenting, licensing, industry
collaboration.
– Long history of such collaboration reflects structural
characteristics of US higher education “system.”
– Growth of patenting in the 1980s was rooted in
developments during the 1970s.
• In important respects, Bayh-Dole was a response to
increased university patenting, rather than an
“exogenous” causal factor.
– Other developments in US IPR policy, growth in biomedical
research funding and scientific advances, contributed to the
growth of patenting during the 1980s.
• The “endogeneity” of Bayh-Dole may limit the effects
of its emulation by other governments.
Conclusion (2)
• More than a “Bayh-Dole policy” is needed to
stimulate closer interaction between universities
and industry.
– Structure of public research funding.
– Structure of university system.
– Importance of institutions external to the university
(labor mobility; venture capital).
• Multiplicity of channels through which
universities and industry interact => the
importance of patents for university-industry
technology & knowledge transfer varies across
and within industries.
– Neither necessary nor sufficient in some research fields.
– Necessary but not sufficient in others.
– What role for different types of firms (established,
small, startup)?
Research issues (partial list)
• effects of “BD emulation” outside of US.
• How do firms exploit university research and how
does this affect their performance?
• Interactions among different classes of U-I links
• Role of established firms in mediating U-I
regional spillovers and cluster formation.
• Effects of patenting on academic research agenda?
• Research tools and IP.
Further Reading
• D. Mowery, "Learning from one another? International
policy “emulation” and university-industry technology
transfer," Industrial and Corporate Change, 2012.
• D. Mowery, “University-Industry Research Collaboration
and Technology Transfer in the United States since 1980,”
in S. Yusuf and K. Nabeshima, How Universities Promote
Economic Growth (World Bank, 2007).
• Ivory Tower and Industrial Innovation: U.S. UniversityIndustry Technology Transfer Before and After the BayhDole Act (with R.R. Nelson, B.N. Sampat, and A.A.
Ziedonis), Stanford University Press, 2004.