Public R&D Investments and Private-sector Patenting: Evidence from NIH Funding Rules
Author(s)
Azoulay, Pierre
Graff Zivin, Joshua S
Li, Danielle
Sampat, Bhaven N
Date Issued
June 2018
Journal
Review of Economic Studies
Publisher
Oxford University Press (OUP)
Citation
Azoulay, Pierre et al. “Public R&D Investments and Private-Sector Patenting: Evidence from NIH Funding Rules.” The Review of Economic Studies 86, 1 (June 2018): 117–152 © 2018 The Author(s)
Version
Original manuscript
Abstract
We quantify the impact of scientific grant funding at the National Institutes of Health (NIH) on patenting by pharmaceutical and biotechnology firms. Our article makes two contributions. First, we use newly constructed bibliometric data to develop a method for flexibly linking specific grant expenditures to private-sector innovations. Second, we take advantage of idiosyncratic rigidities in the rules governing NIH peer review to generate exogenous variation in funding across research areas. Our results show that NIH funding spurs the development of private-sector patents: a $10 million boost in NIH funding leads to a net increase of 2.7 patents. Though valuing patents is difficult, we report a range of estimates for the private value of these patents using different approaches.
MIT Department
Sloan School of Management
Terms of Use
Creative Commons Attribution-Noncommercial-Share Alike
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.1093/RESTUD/RDY034
