Academic freedom, private‐sector focus, and the process of innovation

Philippe Aghion, Mathias Dewatripont and Jeremy C. Stein

RAND Journal of Economics, 2008, vol. 39, issue 3, 617-635

Abstract: We develop a model that clarifies the respective advantages and disadvantages of academic and private‐sector research. Rather than relying on lack of appropriability or spillovers to generate a rationale for academic research, we emphasize control‐rights considerations, and argue that the fundamental tradeoff between academia and the private sector is one of creative control versus focus. By serving as a precommitment mechanism that allows scientists to freely pursue their own interests, academia can be indispensable for early‐stage research. At the same time, the private sector's ability to direct scientists toward higher‐payoff activities makes it more attractive for later‐stage research.

Date: 2008
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https://doi.org/10.1111/j.1756-2171.2008.00031.x

Related works:
Working Paper: Academic Freedom, Private-Sector Focus, and the Process of Innovation (2008)
Working Paper: Academic Freedom, Private-Sector Focus, and the Process of Innovation (2005)
Working Paper: Academic Freedom, Private-Sector Focus, and the Process of Innovation (2005)
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