Incentives and spillovers in R&D activities: an agency-theoretic analysis of industry-university relations
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AbstractIn this paper, I study industry-university relations in a principal- agent framework. Following the existing literature, these relations are interpreted in two ways: (1) as occurring through spillovers of knowledge among different groups of researchers, working for different institutional settings; or (2) as more formal interactions, through the possibility, for a scientist, to directly respond to incentives defined by the different communities she may belong to. I formalize these two configurations in a unified framework. I account for: (1) the inherent difficulty in measuring the impact of scientific activities; and (2) the multiplicity of activities that scientists perform. I combine multi-task agency models with distorted performance measures and common agency models. My model identifies several types of incongruities between an agent's actions and the desired outcomes. These incongruities derive also from the strategic interaction among the principals. I also identify some potentially distortionary behavioral effects of the presence of spillovers.Economics of Science; Agency Theory; Industry-University Relations; Science Policy; R&D Management.