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Political Influence behind the Veil of Peer Review: An Analysis of Public Biomedical Research Funding in the United States*

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  • Deepak Hegde

Abstract

The U.S. public biomedical research system is renowned for its peer review process that awards federal funds to meritorious research performers. Although congressional appropriators do not earmark federal funds for biomedical research performers, I argue that they support allocations for those research fields that are most likely to benefit performers in their constituencies. Such disguised transfers mitigate the reputational penalties to appropriators of interfering with a merit-driven system. I use data on all peer-reviewed grants by the National Institutes of Health during the years 1984-2003 and find that performers in the states of certain House Appropriations Committee members receive 5.9-10.3 percent more research funds than those at unrepresented institutions. The returns to representation are concentrated in state universities and small businesses. Members support funding for the projects of represented performers in fields in which they are relatively weak and counteract the distributive effect of the peer review process. (c) 2009 by The University of Chicago. All rights reserved.

Suggested Citation

  • Deepak Hegde, 2009. "Political Influence behind the Veil of Peer Review: An Analysis of Public Biomedical Research Funding in the United States," Journal of Law and Economics, University of Chicago Press, vol. 52(4), pages 665-690, November.
    • Handle: RePEc:ucp:jlawec:v:52:y:2009:i:4:p:665-690
    DOI: 10.1086/605565
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    References listed on IDEAS

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    1. Weingast, Barry R & Marshall, William J, 1988. "The Industrial Organization of Congress; or, Why Legislatures, Like Firms, Are Not Organized as Markets," Journal of Political Economy, University of Chicago Press, vol. 96(1), pages 132-163, February.
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    Cited by:

    1. Margaret K. Kyle, 2019. "The Alignment of Innovation Policy and Social Welfare: Evidence from Pharmaceuticals," NBER Chapters, in: Innovation Policy and the Economy, Volume 20, pages 95-123, National Bureau of Economic Research, Inc.
    2. Tania Babina & Alex Xi He & Sabrina T. Howell & Elisabeth Ruth Perlman & Joseph Staudt, 2020. "The Color of Money: Federal vs. Industry Funding of University Research," NBER Working Papers 28160, National Bureau of Economic Research, Inc.
    3. Kyle, Margaret K. & Ridley, David B. & Zhang, Su, 2017. "Strategic interaction among governments in the provision of a global public good," Journal of Public Economics, Elsevier, vol. 156(C), pages 185-199.
    4. Raphaël Godefroy, 2010. "The birth of the congressional clinic," Working Papers halshs-00564921, HAL.
    5. Park, Hyunwoo & Lee, Jeongsik (Jay) & Kim, Byung-Cheol, 2015. "Project selection in NIH: A natural experiment from ARRA," Research Policy, Elsevier, vol. 44(6), pages 1145-1159.
    6. Kyle, Margaret K., 2022. "Incentives for pharmaceutical innovation: What’s working, what’s lacking," International Journal of Industrial Organization, Elsevier, vol. 84(C).
    7. Margaret Blume-Kohout & Krishna Kumar & Christopher Lau & Neeraj Sood, 2015. "The effect of federal research funding on formation of university-firm biopharmaceutical alliances," The Journal of Technology Transfer, Springer, vol. 40(5), pages 859-876, October.
    8. Peter T. Leeson & Henry A. Thompson, 2023. "Public choice and public health," Public Choice, Springer, vol. 195(1), pages 5-41, April.
    9. Alberto Batinti, 2016. "NIH biomedical funding: evidence of executive dominance in swing-voter states during presidential elections," Public Choice, Springer, vol. 168(3), pages 239-263, September.
    10. Danielle Li, 2017. "Expertise versus Bias in Evaluation: Evidence from the NIH," American Economic Journal: Applied Economics, American Economic Association, vol. 9(2), pages 60-92, April.
    11. Deepak Hegde & Bhaven Sampat, 2015. "Can Private Money Buy Public Science? Disease Group Lobbying and Federal Funding for Biomedical Research," Management Science, INFORMS, vol. 61(10), pages 2281-2298, October.

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    Replication

    This item has been replicated by:
  • Randall J. Hannum, 2016. "A Replication of “Political Influence behind the Veil of Peer Review†(Journal of Law and Economics 2009)," Public Finance Review, , vol. 44(6), pages 811-817, November.

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