Of Mice and Academics: Examining the Effect of Openness on Innovation

Fiona Murray, Philippe Aghion, Mathias Dewatripont, Julian Kolev, Scott Stern
2016 American Economic Journal: Economic Policy  
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
more » ... urage 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. Using a sample of engineered mice that are linked to specific scientific papers (some affected by the NIH agreements and some not), we implement a differences-in-differences estimator to evaluate how the level and type of follow-on research using these mice changes after the NIH-induced increase in openness. We find a significant increase in the level of follow-on research. Moreover, this increase is driven by a substantial increase in the rate of exploration of more diverse research paths. Overall, our findings highlight a neglected cost of IP: reductions in the diversity of experimentation that follows from a single idea. * MIT, Sloan School of Management † Harvard University and NBER ‡ Universite Libre de Bruxelles § Harvard University ¶ Kellog School of Management, Northwestern University and NBER Key Word Citations (6-1b) DV=Old Key Word Citations (6-2a) DV= New Key Word Citations With Time Dynamics (6-2b) DV= Old Key Word Citations With Time Dynamics
doi:10.1257/pol.20140062 fatcat:f74jfu4qznelnd7ddlpegvrwry