[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v108y2018i7p1860-98.html
   My bibliography  Save this article

University Innovation and the Professor's Privilege

Author

Listed:
  • Hans K. Hvide
  • Benjamin F. Jones
Abstract
National policies take varied approaches to encouraging university-based innovation. This paper studies a natural experiment: the end of the "professor's privilege" in Norway, where university researchers previously enjoyed full rights to their innovations. Upon the reform, Norway moved toward the typical US model, where the university holds majority rights. Using comprehensive data on Norwegian workers, firms, and patents, we find a 50 percent decline in both entrepreneurship and patenting rates by university researchers after the reform. Quality measures for university start-ups and patents also decline. Applications to literature on university technology transfer, innovation incentives, and taxes and entrepreneurship are considered.

Suggested Citation

  • Hans K. Hvide & Benjamin F. Jones, 2018. "University Innovation and the Professor's Privilege," American Economic Review, American Economic Association, vol. 108(7), pages 1860-1898, July.
    • Handle: RePEc:aea:aecrev:v:108:y:2018:i:7:p:1860-98
    Note: DOI: 10.1257/aer.20160284
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/aer.20160284
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=KCWSU3foeGYtv8_MzcxdIbus6kLMvgfA
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=lZqicmRqx1xr9DPvhgpwi0LN39WwYSYW
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/attachments?retrieve=y-KYUbB-wSjaaLRMctyUgI3YXdJ6mNnc
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Thomas Hellmann, 2007. "When Do Employees Become Entrepreneurs?," Management Science, INFORMS, vol. 53(6), pages 919-933, June.
    2. Jerry R. Green & Suzanne Scotchmer, 1995. "On the Division of Profit in Sequential Innovation," RAND Journal of Economics, The RAND Corporation, vol. 26(1), pages 20-33, Spring.
    3. Li, Lixing & Wu, Xiaoyu, 2014. "Housing price and entrepreneurship in China," Journal of Comparative Economics, Elsevier, vol. 42(2), pages 436-449.
    4. Eric J. Iversen & Magnus Gulbrandsen & Antje Klitkou, 2007. "A baseline for the impact of academic patenting legislation in Norway," Scientometrics, Springer;Akadémiai Kiadó, vol. 70(2), pages 393-414, February.
    5. Geuna, Aldo & Rossi, Federica, 2011. "Changes to university IPR regulations in Europe and the impact on academic patenting," Research Policy, Elsevier, vol. 40(8), pages 1068-1076, October.
    6. Sampat, Bhaven N., 2006. "Patenting and US academic research in the 20th century: The world before and after Bayh-Dole," Research Policy, Elsevier, vol. 35(6), pages 772-789, July.
    7. Saul Lach & Mark Schankerman, 2008. "Incentives and invention in universities," RAND Journal of Economics, RAND Corporation, vol. 39(2), pages 403-433, June.
    8. Buenstorf, Guido, 2009. "Is commercialization good or bad for science? Individual-level evidence from the Max Planck Society," Research Policy, Elsevier, vol. 38(2), pages 281-292, March.
    9. Douglas Holtz-Eakin & David Joulfaian & Harvey S. Rosen, 1994. "Entrepreneurial Decisions and Liquidity Constraints," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 334-347, Summer.
    10. Evans, David S & Leighton, Linda S, 1989. "Some Empirical Aspects of Entrepreneurship," American Economic Review, American Economic Association, vol. 79(3), pages 519-535, June.
    11. Francesco Lissoni & Patrick Llerena & Maureen McKelvey & Bulat Sanditov, 2008. "Academic patenting in Europe: new evidence from the KEINS database," Research Evaluation, Oxford University Press, vol. 17(2), pages 87-102, June.
    12. Manuel Trajtenberg, 1990. "A Penny for Your Quotes: Patent Citations and the Value of Innovations," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 172-187, Spring.
    13. Gans, Joshua S. & Stern, Scott, 2003. "The product market and the market for "ideas": commercialization strategies for technology entrepreneurs," Research Policy, Elsevier, vol. 32(2), pages 333-350, February.
    14. Ross Levine & Yona Rubinstein, 2013. "Smart and Illicit: Who Becomes an Entrepreneur and Does it Pay?," CEP Discussion Papers dp1237, Centre for Economic Performance, LSE.
    15. Aaron Chatterji & Edward Glaeser & William Kerr, 2014. "Clusters of Entrepreneurship and Innovation," Innovation Policy and the Economy, University of Chicago Press, vol. 14(1), pages 129-166.
    16. Bengt Holmstrom, 1982. "Moral Hazard in Teams," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 324-340, Autumn.
    17. repec:bla:jindec:v:46:y:1998:i:2:p:125-56 is not listed on IDEAS
    18. Kenney, Martin & Patton, Donald, 2009. "Reconsidering the Bayh-Dole Act and the Current University Invention Ownership Model," Research Policy, Elsevier, vol. 38(9), pages 1407-1422, November.
    19. Joshua S. Gans & David H. Hsu & Scott Stern, 2008. "The Impact of Uncertain Intellectual Property Rights on the Market for Ideas: Evidence from Patent Grant Delays," Management Science, INFORMS, vol. 54(5), pages 982-997, May.
    20. Bronwyn H. Hall & Adam Jaffe & Manuel Trajtenberg, 2005. "Market Value and Patent Citations," RAND Journal of Economics, The RAND Corporation, vol. 36(1), pages 16-38, Spring.
    21. Ramana Nanda & Ken Younge & Lee Fleming, 2014. "Innovation and Entrepreneurship in Renewable Energy," NBER Chapters, in: The Changing Frontier: Rethinking Science and Innovation Policy, pages 199-232, National Bureau of Economic Research, Inc.
    22. Grossman, Sanford J & Hart, Oliver D, 1986. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 691-719, August.
    23. Bronwyn H. Hall, 2007. "Patents and patent policy," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 23(4), pages 568-587, Winter.
    24. Erik Hurst & Annamaria Lusardi, 2004. "Liquidity Constraints, Household Wealth, and Entrepreneurship," Journal of Political Economy, University of Chicago Press, vol. 112(2), pages 319-347, April.
    25. Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626, National Bureau of Economic Research, Inc.
    26. Scott Stern, 2004. "Do Scientists Pay to Be Scientists?," Management Science, INFORMS, vol. 50(6), pages 835-853, June.
    27. Dirk Czarnitzki & Thorsten Doherr & Katrin Hussinger & Paula Schliessler & Andrew A Toole, 2015. "Individual versus institutional ownership of university-discovered inventions," Working Papers of Department of Management, Strategy and Innovation, Leuven 482370, KU Leuven, Faculty of Economics and Business (FEB), Department of Management, Strategy and Innovation, Leuven.
    28. O'Shea, Rory P. & Allen, Thomas J. & Chevalier, Arnaud & Roche, Frank, 2005. "Entrepreneurial orientation, technology transfer and spinoff performance of U.S. universities," Research Policy, Elsevier, vol. 34(7), pages 994-1009, September.
    29. William R. Kerr & Ramana Nanda & Matthew Rhodes-Kropf, 2014. "Entrepreneurship as Experimentation," Journal of Economic Perspectives, American Economic Association, vol. 28(3), pages 25-48, Summer.
    30. Ejaz Ghani & William R. Kerr & Stephen O'Connell, 2014. "Spatial Determinants of Entrepreneurship in India," Regional Studies, Taylor & Francis Journals, vol. 48(6), pages 1071-1089, June.
    31. David C. Mowery & Bhaven N. Sampat, 2005. "The Bayh-Dole Act of 1980 and University-Industry Technology Transfer: A Model for Other OECD Governments?," Springer Books, in: Albert N. Link & F. M. Scherer (ed.), Essays in Honor of Edwin Mansfield, pages 233-245, Springer.
    32. Pierre Azoulay & Waverly Ding & Toby Stuart, 2009. "The Impact Of Academic Patenting On The Rate, Quality And Direction Of (Public) Research Output," Journal of Industrial Economics, Wiley Blackwell, vol. 57(4), pages 637-676, December.
    33. Macho-Stadler, Ines & Perez-Castrillo, David & Veugelers, Reinhilde, 2007. "Licensing of university inventions: The role of a technology transfer office," International Journal of Industrial Organization, Elsevier, vol. 25(3), pages 483-510, June.
    34. Josh Lerner & Robert P. Merges, 1998. "The Control of Technology Alliances: An Empirical Analysis of the Biotechnology Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 46(2), pages 125-156, June.
    35. Jonathan Levin, 2002. "Multilateral Contracting and the Employment Relationship," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 1075-1103.
    36. David C. Mowery & Bhaven N. Sampat, 2005. "The Bayh-Dole Act of 1980 and University--Industry Technology Transfer: A Model for Other OECD Governments?," The Journal of Technology Transfer, Springer, vol. 30(2_2), pages 115-127, January.
    37. Fabrizio, Kira R. & Di Minin, Alberto, 2008. "Commercializing the laboratory: Faculty patenting and the open science environment," Research Policy, Elsevier, vol. 37(5), pages 914-931, June.
    38. Dirk Czarnitzki & Katrin Hussinger & Cédric Schneider, 2011. "Commercializing academic research: the quality of faculty patenting," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 20(5), pages 1403-1437, October.
    39. Marie Thursby & Richard Jensen, 2001. "Proofs and Prototypes for Sale: The Licensing of University Inventions," American Economic Review, American Economic Association, vol. 91(1), pages 240-259, March.
    40. Edward L. Glaeser, 2007. "Entrepreneurship and the City," NBER Working Papers 13551, National Bureau of Economic Research, Inc.
    41. Lockett, Andy & Siegel, Donald & Wright, Mike & Ensley, Michael D., 2005. "The creation of spin-off firms at public research institutions: Managerial and policy implications," Research Policy, Elsevier, vol. 34(7), pages 981-993, September.
    42. Murray, Fiona & Stern, Scott, 2007. "Do formal intellectual property rights hinder the free flow of scientific knowledge?: An empirical test of the anti-commons hypothesis," Journal of Economic Behavior & Organization, Elsevier, vol. 63(4), pages 648-687, August.
    43. Lindh, Thomas & Ohlsson, Henry, 1996. "Self-Employment and Windfall Gains: Evidence from the Swedish Lottery," Economic Journal, Royal Economic Society, vol. 106(439), pages 1515-1526, November.
    44. Fiona E. Murray & Scott Stern, 2007. "Do Formal Intellectual Property Rights Hinder the Free Flow of Scientific Knowledge?: An Empirical Test of the Anti-Commons Hypothesis," NBER Chapters, in: Academic Science and Entrepreneurship: Dual Engines of Growth, National Bureau of Economic Research, Inc.
    45. Suzanne Scotchmer, 1991. "Standing on the Shoulders of Giants: Cumulative Research and the Patent Law," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 29-41, Winter.
    46. Barton H. Hamilton, 2000. "Does Entrepreneurship Pay? An Empirical Analysis of the Returns to Self-Employment," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 604-631, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hvide, Hans K. & Jones, Benjamin, 2016. "University Innovation and the Professor’s Privilege," CEPR Discussion Papers 11139, C.E.P.R. Discussion Papers.
    2. Wipo, 2011. "World Intellectual Property Report 2011- The Changing Face of Innovation," WIPO Economics & Statistics Series, World Intellectual Property Organization - Economics and Statistics Division, number 2011:944, April.
    3. Pluvia Zuniga, 2011. "The State of Patenting at Research Institutions in Developing Countries: Policy Approaches and Practices," WIPO Economic Research Working Papers 04, World Intellectual Property Organization - Economics and Statistics Division, revised Dec 2011.
    4. Nicolas Carayol & Valerio Sterzi, 2021. "The transfer and value of academic inventions when the TTO is one option," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 30(2), pages 338-367, May.
    5. repec:wip:wpaper:4 is not listed on IDEAS
    6. Perkmann, Markus & Tartari, Valentina & McKelvey, Maureen & Autio, Erkko & Broström, Anders & D’Este, Pablo & Fini, Riccardo & Geuna, Aldo & Grimaldi, Rosa & Hughes, Alan & Krabel, Stefan & Kitson, Mi, 2013. "Academic engagement and commercialisation: A review of the literature on university–industry relations," Research Policy, Elsevier, vol. 42(2), pages 423-442.
    7. Ani Gerbin & Mateja Drnovsek, 2016. "Determinants and public policy implications of academic-industry knowledge transfer in life sciences: a review and a conceptual framework," The Journal of Technology Transfer, Springer, vol. 41(5), pages 979-1076, October.
    8. Catalina Martínez & Valerio Sterzi, 2021. "The impact of the abolishment of the professor’s privilege on European university-owned patents," Industry and Innovation, Taylor & Francis Journals, vol. 28(3), pages 247-282, March.
    9. Magerman, Tom & Looy, Bart Van & Debackere, Koenraad, 2015. "Does involvement in patenting jeopardize one’s academic footprint? An analysis of patent-paper pairs in biotechnology," Research Policy, Elsevier, vol. 44(9), pages 1702-1713.
    10. Andrea Bonaccorsi & Daniele Biancardi & Mabel Sanchez Barrioluengo & Federico Biagi, 2019. "Study on Higher Education Institutions and Local Development," JRC Research Reports JRC117272, Joint Research Centre.
    11. Francesco Lissoni & Fabio Montobbio, 2015. "The Ownership of Academic Patents and Their Impact. Evidence from Five European Countries," Revue économique, Presses de Sciences-Po, vol. 66(1), pages 143-171.
    12. Anna Kochenkova & Rosa Grimaldi & Federico Munari, 2016. "Public policy measures in support of knowledge transfer activities: a review of academic literature," The Journal of Technology Transfer, Springer, vol. 41(3), pages 407-429, June.
    13. Brantnell, Anders & Baraldi, Enrico, 2022. "Understanding the roles and involvement of technology transfer offices in the commercialization of university research," Technovation, Elsevier, vol. 115(C).
    14. Czarnitzki, Dirk & Doherr, Thorsten & Hussinger, Katrin & Schliessler, Paula & Toole, Andrew A., 2015. "Individual versus institutional ownership of university-discovered inventions," ZEW Discussion Papers 15-007, ZEW - Leibniz Centre for European Economic Research.
    15. Sterzi, Valerio, 2013. "Patent quality and ownership: An analysis of UK faculty patenting," Research Policy, Elsevier, vol. 42(2), pages 564-576.
    16. Olof Ejermo & John Källström, 2016. "What is the causal effect of R&D on patenting activity in a “professor’s privilege” country? Evidence from Sweden," Small Business Economics, Springer, vol. 47(3), pages 677-694, October.
    17. Foray, Dominique & Lissoni, Francesco, 2010. "University Research and Public–Private Interaction," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 275-314, Elsevier.
    18. Dirk Czarnitzki & Katrin Hussinger & Cédric Schneider, 2012. "The nexus between science and industry: evidence from faculty inventions," The Journal of Technology Transfer, Springer, vol. 37(5), pages 755-776, October.
    19. Laurent R Bergé & Thorsten Doherr & Katrin Hussinger, 2023. "How patent rights affect university science," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 32(3), pages 673-699.
    20. Caviggioli, Federico & De Marco, Antonio & Montobbio, Fabio & Ughetto, Elisa, 2020. "The licensing and selling of inventions by US universities," Technological Forecasting and Social Change, Elsevier, vol. 159(C).
    21. Heike Grimm & Johannes Jaenicke, 2015. "Testing the causal relationship between academic patenting and scientific publishing in Germany: Crowding-out or reinforcement?," The Journal of Technology Transfer, Springer, vol. 40(3), pages 512-535, June.

    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:108:y:2018:i:7:p:1860-98. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.