Markets versus Spillovers in Outflows of University Research

41 Pages Posted: 1 Aug 2014 Last revised: 22 Dec 2014

See all articles by David C. Mowery

David C. Mowery

University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER)

Arvids A. Ziedonis

KU Leuven - Faculty of Economics and Business; Department of Management, Strategy, and Innovation

Date Written: July 25, 2014

Abstract

A substantial body of research has examined the contributions of university research to regional economic development and technological innovation. This literature suggests that the channels through which university–based research affects regional economic or innovative activity may be divided into two broad categories — knowledge “spillovers” (i.e., positive externalities from university research) and “market–mediated” channels such as technology licensing or various types of employment relationships between academic scientists and firms. Yet little research has compared the geographic incidence of these market and nonmarket channels of interaction. This paper compares the localization of knowledge flows from university inventions through market contracts (licenses) and nonmarket “spillovers” exemplified by patent citations. We find knowledge flows through market transactions to be more geographically localized than those operating through nonmarket spillovers. Moreover, the differential effects of distance on licenses and citations are most pronounced for exclusively licensed university patents. We interpret these findings as reflecting the incomplete nature of licensing contracts and the need for licensees to maintain access to inventor know how for many university inventions. Such access appears to be less important for inventions that are nonexclusively licensed.

Keywords: Knowledge spillovers, licensing, university–industry linkages, geographic localization

JEL Classification: O31, O32, R12

Suggested Citation

Mowery, David C. and Ziedonis, Arvids Alexander, Markets versus Spillovers in Outflows of University Research (July 25, 2014). Research Policy, 44(1), pp. 50-66, 2015., Available at SSRN: https://ssrn.com/abstract=2474196

David C. Mowery

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Arvids Alexander Ziedonis (Contact Author)

KU Leuven - Faculty of Economics and Business; Department of Management, Strategy, and Innovation ( email )

Warmoesberg 26
Brussels, 1000
Belgium

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