Three essays on location aspects in biotechnology entrepreneurship

Title from PDF of title page (University of Missouri--Columbia, viewed on October 22, 2010).The entire thesis text is included in the research.pdf file; the official abstract appears in the short.pdf file; a non-technical public abstract appears in the public.pdf file.Dissertation advisor: Dr. Nicholas Kalaitzandonakes.Vita.Ph. D. University of Missouri--Columbia 2010.Mainly due to the potential of knowledge spillovers facilitated by spatial proximity biotechnology firms may benefit from the spatial collocation of similar firms so that they increase their venture capital funds. Essay 1 employs a spatial autoregressive model and finds that venture capital accumulation is augmented by the collocation of biotechnology and venture capital firms within an about 10 miles radius. Spatial externalities wane considerably outside the 10 miles radius and exhaust themselves at about 20 miles. Despite the importance of federal money as the primary source of R&D in biotechnology, relative little research has analyzed the marginal contribution of federal dollars on local firm births. Essay 2 employs a Poisson count data fixed effects model and finds that federal financial outlays towards a region's universities and established private firms eventually translate to increased firm birth rate for the region in question. The empirical results also suggest that private firms are considerably more conducive in spurring local birth rate than universities and research institutes/hospitals. Given the rise of the entrepreneurial university and its focus on local economic development, Essay 3 analyzes factors affecting academic faculty to start their biotechnology firm(s) locally. The estimated results of an ordered logit model highlight the importance of regional, institutional and personal attributes.Includes bibliographical reference

The Entrepreneur's Choice of Location: Evidence from the Life Sciences

Why do biotech firms cluster? New and established firms in biotech clusters are said to capitalize on knowledge spillovers, labor-market pooling, and other externalities. Some have even argued that such spillovers are so strong that the cluster itself, rather than the individual, is the locus of entrepreneurship. Such arguments, however, do not resolve the mechanism by which clusters might contribute to the establishment of new firms. This paper proposes a conceptual framework for analyzing the locational choices of entrepreneurial firms in the life-sciences industry. Building on both the cluster literature and the literature on entrepreneurship, we develop hypotheses about how cluster characteristics, the entrepreneurs personal characteristics, and characteristics of the business environment affect the entrepreneurs decision to establish a new firm. We argue that a key factor in the location decision is the relative mobility of the appropriate resources. Our main hypothesis is that specialized labor is less mobile than capital and other resources and that it is the base from which entrepreneurs are ultimately created. If so, new firms will emerge in areas characterized by an existing concentration of specialized labor. This labor pool may be spawned by universities and incumbent small and larger biotech (or other high-technology) companies. An alternative explanation is that entrepreneurs establish new ventures outside the cluster, then move them to the cluster to take advantage of local knowledge and other resources. Or a potential entrepreneur could conceive a business plan, then relocate to an existing cluster before founding a firm. We explain how survey data can be used to sort through these explanations.entrepreneurship, biotechnology, clusters, knowledge spillovers, agglomeration economies, Industrial Organization, L26, L65, O18, O32,

The value of insiders as mentors : evidence from the effects of NSF rotators on early career scientists

We show that academics with experience in government jobs generate spillovers for their early career colleagues. Our template is the National Science Foundation rotation program in which the agency employs academics, called rotators, on loan from their university. Shortly after the rotator’s return from the agency, fresh assistant professors in her department double their research resources and are more likely to win small and medium size grants compared to academics in three control groups. Consistent with evidence that the mechanism is mentoring from the rotator, the results suggest that access to individuals with insights gained outside academia propels scientific careers

An Optimization Model for Winery Capacity Use

An optimization model to sequence wine flow through the production process is developed. The model is formulated as a mixed integer program and accounts for winemaking specifications, market conditions, grape availability, and tank capacity. An empirical example is provided to demonstrate results and uses of the model.Agribusiness,

Geographic scope of proximity effects among small life sciences firms

A large number of studies have demonstrated that proximity effects from knowledge spillovers, network externalities and other forms of knowledge transfers among like firms are geographically bounded. However, only a few studies have measured the strength and geographic scope of such externalities and even fewer have done so for firms in very close proximity. In this study, we examine the size and geographic scope of proximity effects among all life science firms that have received Small Business Innovation Research (SBIR) grants in the US over a 23-year period while controlling for relevant regional and firm characteristics. From our empirical analysis, we conclude that proximity effects among nearby small life science firms are strong within one-tenth of a mile distance and are exhausted within a radius of 1.5 miles. By examining the location of all firms in the sample, we offer possible explanations for the narrow geographic scope of the measured proximity effects. We also explain the significance of such findings for academic research that seeks to understand the nature of spatial externalities and for public policy

Busy academics share less: The impact of professional and family roles on academic withholding behaviour

Although academics are increasingly expected to share their research data and materials with other academics, many appear reluctant to do so. While extant research emphasises commercial involvement and peer influence as determinants of withholding behaviour, we hypothesise that the volume of competing commitments plays an important role in preventing academics from sharing. Using rich, multi-source data on 876 academics at a large research university, we explore how withholding behaviour is related to the breadth of professional and family roles. We find that academics engaged in more activities, including research, teaching and commercialisation, and with more young children, are more likely than their colleagues to withhold research data and materials from their previously published research. We explore the implications of these findings for scientific production and exchange, and for academics' workloads

The effects of academic incubators on university innovation

In this article, we analyze the impact of academic incubators on the quality of innovations produced by U.S. research‐intensive academic institutions. We show that establishing a university‐affiliated incubator is followed by a reduction in the quality of university innovations. The conclusion holds when we control for the endogeneity of the decision to establish an incubator using the presence of incubators at peer institutions as an instrument. We also document a reduction in licensing income following the establishment of an incubator. The results suggest that university incubators compete for resources with technology transfer offices and other campus programs and activities, such that the useful outputs they generate can be partially offset by reductions in innovation elsewhere

The new needs friends: Simmelian strangers and the selection of novelty

The paradox of rejecting novel ideas while being motivated to select them exists in many realms. Deviating from prior research that investigated several internal levers to promote the funding of novel ideas in the sciences, we focus on an external lever by investigating how seconded employees increase the selection of novel ideas in two ways: (1) they select more novel ideas themselves, and (2) they influence permanent employees to do the same. Combining unique quantitative longitudinal data and 37 in-depth interviews, we test our predictions in the secondment program at the National Science Foundation and find broad support for our theoretical arguments. Our findings have implications for scholars of science and innovation by proposing a relatively light-touch intervention to facilitate the selection of novel ideas

Academic knowledge quality differentials and the quality of firm innovation

This article examines whether knowledge from academic research of varying quality can lead to differential quality innovation at the firm level via a knowledge spillover process—without the firm conducting the research and producing the knowledge but by using it as an external input to its innovation process. Based on econometric analysis of data reflecting patent activity of emerging entrepreneurial life sciences firms and thousands of academic publications, we find that higher-quality academic science associates with higher-quality industrial innovation. Importantly, we document that the degree that a given firm conducts basic science moderates this relationship. Our work develops a novel theoretical and empirical link between academic knowledge quality and industrial innovation and identifies the contingencies that allow this link to materialize

Geographic distance between venture capitalists and target firms and the value of quality signals

In this paper, we examine whether the value of quality signals (patent activity and founding team characteristics) transmitted by emerging biotechnology firms is influenced by the geographic distance between venture capitalists and biotechnology firms. In line with the notion that signals are more valuable to receivers in environments of elevated information asymmetries and under the premise that longdistance transactions present such an environment, we empirically reveal that patent activity and founding team entrepreneurial experience are more effective in increasing venture capital investments when the distance between investors and investees is elevated. Our results, therefore, corroborate the rationale that because tacit knowledge circulates mostly within local circles, it diminishes the value of signals for local transactions, as a priori knowledge about potential target firms is more easily assessed by investors. Our study contributes to the literature on the factors that drive the value of signals, on the literature that studies the function of patents and other forms of intellectual property as a means to boost firm performance, and on the literature on the geography of venture capital investments