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U.S. Universities’ Net Returns from Patenting and Licensing: A Quantile Regression Analysis

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Abstract

In line with the rights and incentives provided by the Bayh-Dole Act of 1980, U.S. universities have increased their involvement in patenting and licensing activities through their own technology transfer offices. Only a few U.S. universities are obtaining large returns, however, whereas others are continuing with these activities despite negligible or negative returns. We assess the U.S. universities' potential to generate returns from licensing activities by modeling and estimating quantiles of the distribution of net licensing returns conditional on some of their structural characteristics. We find limited prospects for public universities without a medical school everywhere in their distribution. Other groups of universities (private, and public with a medical school) can expect significant but still fairly modest returns only beyond the 0.9th quantile. These findings call into question the appropriateness of the revenue-generating motive for the aggressive rate of patenting and licensing by U.S. universities.

Suggested Citation

  • Harun Bulut & GianCarlo Moschini, 2006. "U.S. Universities’ Net Returns from Patenting and Licensing: A Quantile Regression Analysis," Center for Agricultural and Rural Development (CARD) Publications 06-wp432, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  • Handle: RePEc:ias:cpaper:06-wp432
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    1. Sampat, Bhaven N., 2006. "Patenting and US academic research in the 20th century: The world before and after Bayh-Dole," Research Policy, Elsevier, vol. 35(6), pages 772-789, July.
    2. Beath, John & Owen, Robert F. & Poyago-Theotoky, Joanna & Ulph, David, 2003. "Optimal incentives for income-generation in universities: the rule of thumb for the Compton tax," International Journal of Industrial Organization, Elsevier, vol. 21(9), pages 1301-1322, November.
    3. Siegel, Donald S. & Waldman, David & Link, Albert, 2003. "Assessing the impact of organizational practices on the relative productivity of university technology transfer offices: an exploratory study," Research Policy, Elsevier, vol. 32(1), pages 27-48, January.
    4. Rebecca Henderson & Adam B. Jaffe & Manuel Trajtenberg, 1998. "Universities As A Source Of Commercial Technology: A Detailed Analysis Of University Patenting, 1965-1988," The Review of Economics and Statistics, MIT Press, vol. 80(1), pages 119-127, February.
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    8. Link, Albert N. & Scott, John T. & Siegel, Donald S., 2003. "The economics of intellectual property at universities: an overview of the special issue," International Journal of Industrial Organization, Elsevier, vol. 21(9), pages 1217-1225, November.
    9. Saul Lach & Mark Schankerman, 2004. "Royalty Sharing and Technology Licensing in Universities," Journal of the European Economic Association, MIT Press, vol. 2(2-3), pages 252-264, 04/05.
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    Cited by:

    1. Bartelsman, Eric & Dobbelaere, Sabien & Peters, Bettina, 2013. "Allocation of Human Capital and Innovation at the Frontier: Firm-Level Evidence on Germany and the Netherlands," IZA Discussion Papers 7540, Institute for the Study of Labor (IZA).
    2. Katerina Sideri & Andreas Panagopoulos, 2016. "Setting up a Technology Commercialization Office at a Non-Entrepreneurial University: An Insider's Look at Practices and Culture," Working Papers 1609, University of Crete, Department of Economics.
    3. Westerberg, Hans Seerar, 2014. "The Return to R&D and Seller-buyer Interactions: A Quantile Regression Approach," Ratio Working Papers 231, The Ratio Institute.
    4. Fang, Di & Richards, Timothy & Rickard, Bradley, 2015. "Optimal Licensing of Agricultural Patents: Fees Versus Royalties," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 40(1), pages 1-22.
    5. Richards, Timothy J. & Rickard, Bradley J., 2013. "Patents as Options: Path-Dependency and Patent Value," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149725, Agricultural and Applied Economics Association.
    6. repec:kap:jtecht:v:43:y:2018:i:4:d:10.1007_s10961-016-9526-z is not listed on IDEAS
    7. Yuandi Wang & Ruifeng Hu & Weiping Li & Xiongfeng Pan, 2016. "Does teaching benefit from university–industry collaboration? Investigating the role of academic commercialization and engagement," Scientometrics, Springer;Akadémiai Kiadó, vol. 106(3), pages 1037-1055, March.
    8. Rickard, Bradley J. & Schmit, Todd M. & Gomez, Miguel I. & Lu, Hao, 2011. "Does the Name Matter? Developing Brands for Patented Fruit Varieties," Working Papers 126603, Cornell University, Department of Applied Economics and Management.
    9. Birgitte Andersen & Federica Rossi, 2011. "Intellectual property governance and knowledge creation in UK universities," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 20(8), pages 701-725, September.
    10. Bradley J. Rickard & Timothy J. Richards & Jubo Yan, 2016. "University licensing of patents for varietal innovations in agriculture," Agricultural Economics, International Association of Agricultural Economists, vol. 47(1), pages 3-14, January.
    11. Birgitte Andersen & Federica Rossi, 2012. "Inefficiencies in markets for intellectual property rights: experiences of academic and public research institutions," Prometheus, Taylor & Francis Journals, vol. 30(1), pages 5-27, March.
    12. Christian Fisch & Tobias Hassel & Philipp Sandner & Joern Block, 2015. "University patenting: a comparison of 300 leading universities worldwide," The Journal of Technology Transfer, Springer, vol. 40(2), pages 318-345, April.
    13. Gallardo, R. Karina & McCluskey, Jill J. & Rickard, Bradley J. & Akhundjanov, Sherzod B., 2016. "Assessing Innovator and Grower Profit Potential under Different New Plant Variety Commercialization Strategies," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235940, Agricultural and Applied Economics Association.
    14. Mata, José & Woerter, Martin, 2013. "Risky innovation: The impact of internal and external R&D strategies upon the distribution of returns," Research Policy, Elsevier, vol. 42(2), pages 495-501.
    15. Lee, Yoo Hwan & Graff, Gregory D., 2016. "Academic Knowledge Spillovers and the Role of Geographic Proximity in Regional Agriculture-related Sectors: The impact of agricultural research at Colorado State University on the Colorado economy, an," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235717, Agricultural and Applied Economics Association.
    16. Isabel Maria Bodas Freitas & Aldo Geuna & Federica Rossi, 2011. "University–Industry Interactions: The Unresolved Puzzle," Chapters,in: Handbook on the Economic Complexity of Technological Change, chapter 11 Edward Elgar Publishing.
    17. repec:spr:scient:v:103:y:2015:i:2:d:10.1007_s11192-015-1552-3 is not listed on IDEAS

    More about this item

    Keywords

    Bayh-Dole Act; quantile regression; returns to innovation; skewed distributions; technology transfer; university patents.;

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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