IVS Seminar 28.10.2005

Abstract

This paper analyzes the choice of academic scientists to undertake

commercial activities. The focus is on the peculiarities of academic

entrepreneurship as opposed to industrial entrepreneurship. I build a

model of the timing of entry into commercially oriented activities

by an academic research team, and of the returns and costs of these

activities. I compare the behavior and performance of the academic

team to an industrial research team. The two teams are assumed to differ

in their objectives, governance modes and incentive systems. I show that,

while in some cases academic scientists are more reluctant to move to commercially relevant activities, in other cases they may even move

faster than profit-seeking firms would, and perform less basic research.

I also derive that academic scientists tend to enter commercial projects

with higher returns than industrial actors. Therefore, a self-selection

mechanism may explain the success of "academic entrepreneurs".

This study helps interpreting the mixed evidence on the success of, and

the arguments in favor and against the involvement of universities into

business-related research activities. In addition to reviewing the existing

managerial and policy debate and empirical evidence in the light of my

theoretical analysis, I also identify and discuss a series of empirical

settings where to test the predictions of the model.

Keywords: Academic Entrepreneurship, Research and Development, Economics of Science, Science and Technology Policy.

JEL classification: I23, L21, L31, M13, O31