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Funding Risky Research

Author

Listed:
  • Chiara Franzoni
  • Paula Stephan
  • Reinhilde Veugelers

Abstract

The speed with which COVID-19 vaccines were developed and their high performance underlines how much society depends on the pace of scientific research and how effective science can be. This is especially the case for vaccines based on the new designer messenger RNA (mRNA) technology. We draw on this exceptional moment for science to reflect on whether the government funding system is sufficiently supportive of research needed for key breakthroughs, and whether the system of funding encourages sufficient risk-taking to induce scientists to explore transformative research paths. We begin with a discussion of the challenges faced by scientists who did pioneering research related to mRNA-based drugs in getting support for research. We describe measures developed to distinguish risky from nonrisky research and their citation footprint. We review empirical work suggesting that funding is biased against risky research and provide a framework for thinking about why principal investigators, panelists, and funding agencies may eschew risky research. We close with a discussion of interventions that government agencies and universities could follow if they wish to avoid a bias against risk.

Suggested Citation

  • Chiara Franzoni & Paula Stephan & Reinhilde Veugelers, 2022. "Funding Risky Research," Entrepreneurship and Innovation Policy and the Economy, University of Chicago Press, vol. 1(1), pages 103-133.
    • Handle: RePEc:ucp:eipoec:doi:10.1086/719252
    DOI: 10.1086/719252
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    Cited by:

    1. Lawson, Cornelia & Salter, Ammon, 2023. "Exploring the effect of overlapping institutional applications on panel decision-making," Research Policy, Elsevier, vol. 52(9).
    2. Corsini, Alberto & Pezzoni, Michele, 2023. "Does grant funding foster research impact? Evidence from France," Journal of Informetrics, Elsevier, vol. 17(4).
    3. Purvis, Ben & Genovese, Andrea, 2023. "Better or different? A reflection on the suitability of indicator methods for a just transition to a circular economy," Ecological Economics, Elsevier, vol. 212(C).
    4. Confraria, Hugo & Ciarli, Tommaso & Noyons, Ed, 2024. "Countries' research priorities in relation to the Sustainable Development Goals," Research Policy, Elsevier, vol. 53(3).
    5. Cosma, Simona & Cosma, Stefano & Pennetta, Daniela & Rimo, Giuseppe, 2025. "Overcoming the “valleys of death” in advanced therapies: The role of finance," Social Science & Medicine, Elsevier, vol. 366(C).
    6. Damrich, Sebastian & Kealey, Terence & Ricketts, Martin, 2022. "Crowding in and crowding out within a contribution good model of research," Research Policy, Elsevier, vol. 51(1).
    7. Bianchini, Stefano & Müller, Moritz & Pelletier, Pierre, 2025. "Drivers and barriers of AI adoption and use in scientific research," Technological Forecasting and Social Change, Elsevier, vol. 220(C).
    8. Finn Luebber & Sören Krach & Frieder M. Paulus & Lena Rademacher & Rima-Maria Rahal, 2025. "Lottery before peer review is associated with increased female representation and reduced estimated economic cost in a German funding line," Nature Communications, Nature, vol. 16(1), pages 1-11, December.

    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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