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Opportunities and Benefits as Determinants of the Direction of Scientific Research

Author

Listed:
  • Mikko Packalen

    (Department of Economics, University of Waterloo)

  • Jay Bhattacharya

    (Stanford University School of Medicine)

Abstract

Scientific research and private-sector technological innovation are different in terms of objectives, constraints, and organizational forms. For example, the for-profit objective that drives private-sector innovation is absent from much of scientific research, and individual researchers have many times more control in scientific research than in private-sector innovation. These differences and the lack of any obvious objective that would drive the direction of scientific research raise the possibility that the direction of scientific research is exogenous in the sense that it may not be influenced by factors such as the quality of research opportunities and the expected benefit from research that not only drive private-sector innovation but also in part determine the socially optimal allocation of research. Alternatively, some--yet largely unexplored--mechanisms drive also the direction of scientific research to respond to these factors. In this paper we test these two competing hypotheses of scientific research. In particular, we examine whether the composition of medical research responds to changes in disease prevalence and research opportunities. The extent of inventive activity is measured from the MEDLINE database on 16 million biomedical publications. We match these data with data on disease prevalence. We develop and apply a method for estimating the quality of research opportunities from structural productivity parameters. Our results show that the direction of medical research responds to changes in disease prevalence and research opportunities.

Suggested Citation

  • Mikko Packalen & Jay Bhattacharya, 2010. "Opportunities and Benefits as Determinants of the Direction of Scientific Research," Working Papers 1014, University of Waterloo, Department of Economics, revised Dec 2010.
    • Handle: RePEc:wat:wpaper:1014
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    File URL: http://economics.uwaterloo.ca/documents/10-014MP.pdf
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    2. David Popp, 2015. "Using Scientific Publications to Evaluate Government R&D Spending: The Case of Energy," CESifo Working Paper Series 5442, CESifo.
    3. Jay Bhattacharya & Mikko Packalen, 2020. "Stagnation and Scientific Incentives," NBER Working Papers 26752, National Bureau of Economic Research, Inc.
    4. Kyle Myers, 2020. "The Elasticity of Science," American Economic Journal: Applied Economics, American Economic Association, vol. 12(4), pages 103-134, October.
    5. 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.
    6. Anderson, Simon & Waldfogel, Joel, 2015. "Preference Externalities in Media Markets," CEPR Discussion Papers 10835, C.E.P.R. Discussion Papers.
    7. David Popp, 2015. "Using Scientific Publications to Evaluate Government R&D Spending: The Case of Energy," NBER Working Papers 21415, National Bureau of Economic Research, Inc.
    8. Gilad Sorek, 2013. "Efficient Self-Protection and Progress in Curing-Technology," Auburn Economics Working Paper Series auwp2013-07, Department of Economics, Auburn University.
    9. Rotolo, Daniele & Camerani, Roberto & Grassano, Nicola & Martin, Ben R., 2022. "Why do firms publish? A systematic literature review and a conceptual framework," Research Policy, Elsevier, vol. 51(10).
    10. Barrenho, E & Smith, PC & Miraldo, M, 2013. "The determinants of attrition in drug development: a duration analysis," Working Papers 12204, Imperial College, London, Imperial College Business School.
    11. Sampat, Bhaven N., 2012. "Mission-oriented biomedical research at the NIH," Research Policy, Elsevier, vol. 41(10), pages 1729-1741.
    12. Gentilini, Arianna & Miraldo, Marisa, 2023. "The role of patient organisations in research and development: Evidence from rare diseases," Social Science & Medicine, Elsevier, vol. 338(C).
    13. Blandinieres, Florence & Pellens, Maikel, 2021. "Scientist's industry engagement and the research agenda: Evidence from Germany," ZEW Discussion Papers 21-001, ZEW - Leibniz Centre for European Economic Research.

    More about this item

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics

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