Examining the Effect of Openness on Innovation

Article: Of Mice and Academics: Examining the Effect of Openness on Innovation. By Fiona Murray∗, Philippe Aghion†, Mathias Dewatripont, Julian Kolev and Scott Stern.

URL = http://www.economics.harvard.edu/faculty/aghion/files/Of%20Mice%20and%20Academics.pdf

Abstract

“Scientific freedom and openness are hallmarks of academia: relative to their counterparts in industry, academics maintain discretion over their research agenda and allow others to build on their discoveries. This paper examines the relationship between openness and freedom, building on recent models emphasizing that, from an economic perspective, freedom is the granting of control rights to researchers. Within this framework, openness of upstream research does not simply encourage higher levels of downstream exploitation. It also raises the incentives for additional upstream research by encouraging the establishment of entirely new research directions. In other words, within academia, restrictions on scientific openness (such as those created by formal intellectual property (IP)) may limit the diversity and experimentation of basic research itself. We test this hypothesis by examining a “natural experiment” in openness within the academic community: NIH agreements during the late 1990s that circumscribed IP restrictions for academics regarding certain genetically engineered mice.”