Rent Bypassing and Sourcing of University-Based Technology

Abstract

Our paper advances theory by addressing the problem of expropriation by specialized knowledge agents who create value-generating resources claimed by principals. Specifically, we explore the conditions under which university scientists can redirect the value of discoveries from university laboratories via private appropriation directly to the market. We studied 23,394 scientists working in 54 U.S. universities and found that private appropriation is reduced when a university professionalizes its technology transfer function. Contrary to expectations contingent compensation schemes tend to encourage more private appropriation. We also found that more valuable intellectual capital and being located in an entrepreneurially active environment were associated with increased private appropriation.

Keywords: Entrepreneurship

JEL Classification: M13