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Patent Licensing and the Research University

  • Richard A. Jensen
  • Marie C. Thursby

We construct a dynamic model of university research that allows us to examine recent concerns that financial incentives associated with university patent licensing are detrimental to the traditional mission of US research universities. We assume a principal-agent framework in which the university administration is the principal and a faculty researcher is the agent. Whether or not the researcher remains in the university, and if so her choice of the amount of time to spend on basic and applied research, is complicated by the fact that she earns license income and prestige both inside and outside the university. Thus in contrast to usual principal agent models the participation constraint is endogenous. This, plus the fact that current research affects future knowledge stocks, allows us to show that it is far from obvious that licensing will damage basic research and education.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10758.

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Date of creation: Sep 2004
Date of revision:
Handle: RePEc:nbr:nberwo:10758
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  1. Borooah, Vani K, 1994. " Modelling Institutional Behaviour: A Microeconomic Analysis of University Management," Public Choice, Springer, vol. 81(1-2), pages 101-24, October.
  2. Rey, Elena Del, 2001. "Teaching versus Research: A Model of State University Competition," Journal of Urban Economics, Elsevier, vol. 49(2), pages 356-373, March.
  3. Jerry Thursby & Marie Thursby, 2005. "Gender Patterns of Research and Licensing Activity of Science and Engineering Faculty," The Journal of Technology Transfer, Springer, vol. 30(4), pages 343-353, October.
  4. Stephan, Paula E & Levin, Sharon G, 1996. " Property Rights and Entrepreneurship in Science," Small Business Economics, Springer, vol. 8(3), pages 177-88, June.
  5. Marie Thursby & Richard Jensen, 2001. "Proofs and Prototypes for Sale: The Licensing of University Inventions," American Economic Review, American Economic Association, vol. 91(1), pages 240-259, March.
  6. Jaffe, Adam B & Trajtenberg, Manuel & Henderson, Rebecca, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 577-98, August.
  7. Jerry G. Thursby & Marie C. Thursby, 2000. "Who is Selling the Ivory Tower? Sources of Growth in University Licensing," NBER Working Papers 7718, National Bureau of Economic Research, Inc.
  8. Thursby, Jerry G & Jensen, Richard & Thursby, Marie C, 2001. " Objectives, Characteristics and Outcomes of University Licensing: A Survey of Major U.S. Universities," The Journal of Technology Transfer, Springer, vol. 26(1-2), pages 59-72, January.
  9. Levin, Sharon G & Stephan, Paula E, 1991. "Research Productivity over the Life Cycle: Evidence for Academic Scientists," American Economic Review, American Economic Association, vol. 81(1), pages 114-32, March.
  10. Iain Cockburn & Rebecca Henderson & Scott Stern, 1999. "Balancing Incentives: The Tension Between Basic and Applied Research," NBER Working Papers 6882, National Bureau of Economic Research, Inc.
  11. Stephan, Paula E, 2001. " Educational Implications of University-Industry Technology Transfer," The Journal of Technology Transfer, Springer, vol. 26(3), pages 199-205, June.
  12. John Beath & Robert Owen & Joanna Poyago-Theotoky & David Ulph, 2000. "Optimal Incentives for Income-Generation within Universities," Discussion Paper Series, Department of Economics 200007, Department of Economics, University of St. Andrews.
  13. Nancy T. Gallini, 2002. "The Economics of Patents: Lessons from Recent U.S. Patent Reform," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 131-154, Spring.
  14. Louis, Karen Seashore, et al, 2001. " Entrepreneurship, Secrecy, and Productivity: A Comparison of Clinical and Non-clinical Life Sciences Faculty," The Journal of Technology Transfer, Springer, vol. 26(3), pages 233-45, June.
  15. Richard A. Jensen & Jerry G. Thursby & Marie C. Thursby, 2003. "The Disclosure and Licensing of University Inventions," NBER Working Papers 9734, National Bureau of Economic Research, Inc.
  16. Lynne G. Zucker & Michael R. Darby & Jeff Armstrong, 1994. "Intellectual Capital and the Firm: The Technology of Geographically Localized Knowledge Spillovers," NBER Working Papers 4946, National Bureau of Economic Research, Inc.
  17. Paula E. Stephan, 1996. "The Economics of Science," Journal of Economic Literature, American Economic Association, vol. 34(3), pages 1199-1235, September.
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