TO ADMIT OR NOT TO ADMIT: THE QUESTION OF RESEARCH PARK SIZE

A theoretical model is used to explore the determinants of the optimum size of a private research park and the effect of university affiliation on that optimum size. Parks are assumed to operate as cooperatives where costs are equally shared among the member firms, and optimality occurs when the firms’ average net benefits are maximized. To achieve this, existing members of a park will limit the park's size, denying entry to firms who wish to join and are willing to share the costs. University affiliation may either increase or decrease the optimum size of a park.     

Knowledge spillovers, collective entrepreneurship, and economic growth: the role of universities

To improve our understanding of the role that universities play in facilitating the transmission of knowledge to private-sector business enterprises so as to generate economic growth, this article builds on the Knowledge Spillover Theory of Entrepreneurship to develop a formal model of university-with-business enterprise collaborative research partnerships in which the outcome is both mutually desirable and feasible. This model shows that if a university seeks to act as a complement to private-sector collaborative R&D so that it will be attractive to both incumbent firms and startup entrepreneurs, it needs to structure its program so that business enterprise revenues increase and business enterprise R&D costs rise by a smaller proportion than revenues increase, if they rise at all (and a fall would be better). Such a structure is consistent with both business enterprise and university interests, but is only likely to be feasible if the university is subsidized to cover the cost of such public-private collaborative research partnerships. In the absence of such support, the university will have to cover its costs through a fee charged to participating business enterprises and that will result in the university being seen as a substitute rather than a complement to private-sector collaborative R&D, and thus the university will be seen as an unattractive partner for many business enterprises.     

Het Belastingwezen van Zwitserland

Georg Schanz: Die Steuern der Schweiz in ihrer geschichtlichen Entwickelung im 19en Jahrhundert.     

The legacy and promise of Vannevar Bush: rethinking the model of innovation and the role of public policy

The linear model of innovation argues that innovation takes place in a unidirectional sequence, with basic research directly diffusing in marketable product or process innovations. This perspective has served society well in past decades. However, recent productivity slowdowns in developed economies and the failure of innovation policies to continue to deliver desired results have called this perspective into question. Scholars explain these slowdowns by the oversimplification of the linear model which fails to consider the complexities associated with innovation processes. Although it is generally believed that Vannevar Bush’s report Science – The Endless Frontier – was based on his belief in a linear model of innovation and the notion that basic research is the ultimate source of all innovation, an examination of Bush’s writings and his life reveals that he believed in a more sophisticated model in which basic and applied research cross-fertilize each other and in which government’s job is not so much to stimulate basic research as it is to facilitate interactions between basic and applied research for the benefit of both and the prosperity of society. This paper explicates Bush’s model of the research and innovation process, explores the implications of that model, and derives policy recommendations.     

Why are governmental R&D and private R&D complements?

It is well known that government R&D and private R&D have a complementary relationship. However, no previous study has provided an explanation for why that complementary relationship exists. This paper argues that infratechnology is the critical link between governmental and private R&D and that the observed complementarity is the result of technical complementarity at the production level between funding, infratechnology, and knowledge sharing. A theoritical framework based on this argument is developed and examined empirically for supporting evidence. Evidence of technical complementary is found as well as evidence that governmental R&D stimulates the sharing of knowledge.     

Transmission of Risk-Averse Behavior in Small Firms

Small-sized firms are typically more entrepreneurial and engage in more innovation and risk-taking behavior. For that reason they are considered the engines of future economic growth. One policy for stimulating such activity is to provide government contracts for small firms. However, such contracts as typically written result in increased risk-averse behavior on the part of small firms out of a desire by government officials to shift the risk to the firms. This, in turn results in a reduced level of innovative and entrepreneurial activity. To eliminate the disincentive to engage in innovation and entrepreneurial activity, government needs to bear the risk associated with such contracts. One possible solution, given the natural risk aversion of elected officials, is to engage in a portfolio approach to small firm contracts by which the government can diversify away some of the risk.