|
Research seminar organized by
Center for Strategic Management and Globalization (SMG) and Department of Economics (ECON)
“On the Management of Research Collaborations: Which Form of Governance?”
By Claudio Panico, Bocconi University
Abstract: The management of research collaborations is challenging in many respects. It is hard to specify in advance the research output to be obtained and how to share the resulting gains. The research efforts of one party are hard to monitor for the other party and the collaboration may fail to deliver any gain. The parties may also decide to interrupt the collaboration at a later stage and proceed separately. All these aspects pose big governance challenges. On the other hand, it is increasingly more common to observe contractual forms of collaborations. Formal contracts give birth to a large variety of forms of governance by specifying a configuration of control and an allocation of ownership.
We build a simple model to develop a normative analysis of the contractual governance of a research collaboration between a customer firm and a research unit. We set up a principal-agent model that integrates agency theory and the property-rights approach to endogenize the form of governance, that is to say an allocation of control and ownership rights.
The customer initially has all the bargaining power and designs the governance. The initial governance shapes the parties' relative bargaining position in the ex post negotiation and affects the unit's ex-ante incentives. Following property-rights economics, we first address the case when the parties always agree to stay together when negotiating over the allocation of the quasi-rents. We say that the collaboration in this case is stable. But we also address the case when the collaboration is unstable as the parties might prefer instead to break it up and proceed separately. We identify trade-offs in the initial choice of the form of governance that have gone unnoticed in the literature and provide new insights into the functioning of research collaborations.
Paper will be available here (Click here)
|