UNDERSTAND | May 16, 2016

Understanding University Intellectual Policy and Commercialization

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For many years, the National Bureau of Economic Research (NBER) Innovation Policy and the Economy Working Group has published research to understand incentives relative to university intellectual property (IP) policy and commercialization.

Based upon their research, we now know incentive alignment counts – and through that lens – Bob Litan, former Vice President of Research and Policy at the Kauffman Foundation, and I proposed the potential to drive a faster path to market with a little testing of policy. In January of 2010, Harvard Business Review highlighted one of our policy recommendations tied to university IP.

The policy recommendation included removing the technology-licensing obstacle, to ease the way for innovation to get to the market place faster. “University-based innovators routinely produce breakthrough technologies that, if commercialized by industry, have the power to sustain economic growth,” the review included.

The idea of faculty ownership of IP wasn’t very popular with U.S. university administration. The good news was that the idea wasn’t meant only for U.S. universities. Our article did serve the purpose of sparking a lively debate across the globe. At the time, it was not unusual for countries across the globe to look toward U.S. policy on topics resembling innovation and entrepreneurship as “the right answer” when informing their own policies of economic growth. In the discussion of alternative pathways to market, we wanted to encourage countries to consider their country context before replicating policy.

Research has long uncovered the need for policy to be engendered in regional context. Most recently, the Innovation’s Journal published for the March 2016 Global Entrepreneurship Congress and lead by Global Entrepreneurship Research Network’s executive director, Philip Auerswald, outlined significant evidence of the need for regionally focused policy. Policy in support of innovation and entrepreneurship in Argentina enables very different levers for economic growth than policy required for the different context in Kenya. Current growth patterns, age and skill level of population all provide relevant context.

Through the work of partners across the globe we will continue to highlight new policy research and two recently published papers reviewing the effectiveness of the university intellectual policy ownership should be recognized.

One is the work of Hans K. Hvide and Benjamin Jones, titled “Innovation and the Professor’s Privilege.” Their NBER paper examined a natural experiment in Norway were university researchers previously had full rights to their innovations. Their research uncovered a 50-percent decline in both entrepreneurship and patenting rates, which occurred after policy changes were implemented transferring faculty ownership of IP to the university.

Most recently, the European Economic Review published, “Knowledge creates markets: The influence of entrepreneurial support and patent rights on academic entrepreneurship.” This paper focused on IP in Germany post implementation of university ownership policy finding a substantial decrease in the volume of patents with the largest decrease taking place in faculty-firm patenting relationships.

We hope all Global Entrepreneurship and GERN partners will continue to highlight new policy research that could be taken into consideration by our global partners.  

Lesa Mitchell has over twenty-five years of executive experience in enterprise technology design and implementation in the pharmaceutical… About the author