Recent Research: Does Academic Entrepreneurship Stifle Research?

Encouraging university researchers to bring their discoveries to market is a key component of many regional innovation strategies, but entrepreneurial activity by faculty may come at a cost, according to several recent scholarly articles by Andrew A. Toole and Dirk Czarnitzki. Toole and Czarnitzki examined the publication and commercialization histories of U.S. university-based life scientists and found that engaging in entrepreneurial activities tends to lower their publication rate, even after returning to the university full-time. This reduction in publication has a nontrivial impact on knowledge creation in the nonprofit research sector, particularly since researchers who engage in entrepreneurial activity tend to publish at a higher rate than other faculty before they leave to pursue private sector opportunities. Although the commercialization of new technologies is important for the economy, reducing the research output of star professors could have longer-term negative consequences. The authors suggest that the correct balance of research and commercialization has not yet been achieved.

In a series of papers using panel data on U.S. biomedical scientists who received support from the National Institutes of Health (NIH) and data on SBIR recipients, Toole and Czarnitzki examined how academic entrepreneurship affects the output of university researchers. Since inclusion in an SBIR proposal requires that the researcher spend 51 percent of their time with the applicant for-profit firm throughout the duration of the project, these proposals serve as an indicator of an academic researchers status at any given time.

In "Commercializing Science: Is There a University Brain Drain from Academic Entrepreneurship?," the authors examine the academic output of NIH research peers before and after participating in SBIR commercialization projects. Academic output is defined as the number of journal publications, the number of journal publications divided by the number of co-authors, the value of NIH awards and the number of patents earned by scientists and assigned to universities. All four of the metrics fall when a researcher makes a permanent move to the private sector and is replaced by a non-entrepreneurial researcher. The loss is particularly costly to universities, since entrepreneurial academics tend to produce more research. Before joining the private sector, scientists who will at some point in the future participate in academic entrepreneurship, publish at a higher rate than non-entrepreneurial researchers. Once they join an SBIR project, however, their publication rate falls below non-entrepreneurs.

Read "Commercializing Science: Is there a University Brain Drain from Academic Entrepreneurship" at: http://www.econ.ku.dk/cie/calendar/archive/seminars/dokumenter/tc2007_braindrain_r2__2_.pdf/.

Using a similar dataset in "Is There a Trade-Off Between Academic Research and Faculty Entrepreneurship? Evidence from U.S. NIH Supported Biomedical Researchers," the authors focus on the publishing rates of university researchers as they leave university employment for the private sector, and, in some cases, return. Toole and Czarnitzki conclude that a trade-off exists, in which university scientists decrease their publication activity once they join a private firm. When entrepreneurial researchers rejoin the university, their publication rates increase, but tend to plateau at the same rate as non-entrepreneurs

The authors acknowledge that these findings contradict previous studies of publishing rates. The paper references the work of Zucker and Darby (see the May 1, 2006 issue) who also studied the entrepreneurial activities of biomedical researchers, and, in particular, "star" scientists with a strong history of publication. Zucker and Darby found that the involvement of star scientists with firms increased their published output, and even increased its impact based on citations. Other previous studies also found few tradeoffs associated with public-private research collaborations and with researcher involvement in startup formation. The authors note that more research is needed, particularly on the subject of researchers in fields other than biomedicine, but suggest that academic entrepreneurship leads to a substantial loss of public scientific knowledge. This loss may not outweigh the gains from entrepreneurship and the commercialization of university discoveries, but does have some economic impact.

Read "Is There a Trade-Off Between Academic Research and Faculty Entrepreneurship? Evidence from U.S. NIH Supported Biomedical Researchers" at: http://ideas.repec.org/p/zbw/zewdip/09022.html.