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Different Missions and Commitment Power in R&D Organizations: Theory and Evidence on Industry-University Alliances

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  • Nicola Lacetera

    () (Department of Economics, Weatherhead School of Management, Case Western Reserve University, Cleveland, Ohio 44106)

Abstract

This paper proposes a theory for why firms conduct some research activities in-house but outsource other projects to independent partners and for why firms retain different degrees of control over collaborative research projects. The focus is on the determinants of a company's choice to outsource research projects to academic organizations. Because of the different institutional missions of academic organizations, outsourcing a project to a university allows a firm to commit not to terminate or alter a scientifically valuable project before it is complete. This commitment is potentially valuable for the firm in an environment where scientific value and economic value may not coincide, and scientific workers are responsive to the incentives defined by their community of peers. An economic model that formalizes these arguments is developed. Empirical hypotheses are then formulated about the kind of research activities firms will outsource to universities and activities on which they will exert stronger control. Evidence from a sample of industry-university research agreements, as well as from other large-sample and case studies, shows patterns consistent with the predictions of the model.

Suggested Citation

  • Nicola Lacetera, 2009. "Different Missions and Commitment Power in R&D Organizations: Theory and Evidence on Industry-University Alliances," Organization Science, INFORMS, vol. 20(3), pages 565-582, June.
  • Handle: RePEc:inm:ororsc:v:20:y:2009:i:3:p:565-582
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    File URL: http://dx.doi.org/10.1287/orsc.1080.0366
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    References listed on IDEAS

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    Cited by:

    1. Arts, Sam & Veugelers, Reinhilde, 2018. "Taste for Science, Academic Boundary Spanning and Inventive Performance of Scientists and Engineers in Industry," CEPR Discussion Papers 12704, C.E.P.R. Discussion Papers.
    2. Albert Banal-Estañol & Inés Macho-Stadler & David Pérez-Castrillo, 2011. "Research Output from University-Industry Collaborative Projects," Working Papers 539, Barcelona Graduate School of Economics.
    3. Farkhat Dnishev & Farida Alzhanova & Gulnaz Alibekova, 2015. "Innovative Development of Kazakhstan on The Basis of Triple Helix and Cluster Approach," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(2), pages 160-171.
    4. Isabel M. Bodas Freitas & Aldo Geuna & Federica Rossi, 2012. "The governance of formal university--industry interactions: understanding the rationales for alternative models," Prometheus, Taylor & Francis Journals, vol. 30(1), pages 29-45, March.
    5. Henry Sauermann & Michael Roach, 2011. "Not All Scientists pay to be Scientists:," DRUID Working Papers 11-03, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    6. Henry Sauermann, 2017. "Fire in the Belly? Employee Motives and Innovative Performance in Startups versus Established Firms," NBER Working Papers 23099, National Bureau of Economic Research, Inc.
    7. Denisa Mindruta, 2013. "Value creation in university-firm research collaborations: A matching approach," Strategic Management Journal, Wiley Blackwell, vol. 34(6), pages 644-665, June.
    8. Rory O’Shea & Harveen Chugh & Thomas Allen, 2008. "Determinants and consequences of university spinoff activity: a conceptual framework," The Journal of Technology Transfer, Springer, vol. 33(6), pages 653-666, December.

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