On the frontier
An Empirical Examination of Patent Hold-up
Alexander Galetovic, Stephen Haber & Ross Levine
NBER Working Paper, April 2015
Abstract:
A large literature asserts that standard essential patents (SEPs) allow their owners to "hold up" innovation by charging fees that exceed their incremental contribution to a final product. We evaluate two central, interrelated predictions of this SEP hold-up hypothesis: (1) SEP-reliant industries should experience more stagnant quality-adjusted prices than similar non-SEP-reliant industries; and (2) court decisions that reduce the excessive power of SEP holders should accelerate innovation in SEP-reliant industries. We find no empirical support for either prediction. Indeed, SEP-reliant industries have the fastest quality-adjusted price declines in the U.S. economy.
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Project Selection in NIH: A Natural Experiment from ARRA
Hyunwoo Park, Jeongsik Lee & Byung-Cheol Kim
Research Policy, July 2015, Pages 1145–1159
Abstract:
Using a natural experiment in research funding by the National Institutes of Health (NIH) following the American Recovery and Reinvestment Act (ARRA) of 2009, we study the NIH's revealed preference in project selection. We do so by comparing the characteristics of the projects additionally selected for funding due to an unexpected increase in resources under the ARRA with those supported through regular NIH budget. We find that the regular-funded projects are on average of higher quality, as measured by the number of publications per project and the impact of these publications, than ARRA-funded projects. Moreover, compared to ARRA projects, regular projects are more likely to produce highest-impact articles and exhibit greater variance in research output. The output from regular projects also seems more closely fitting the purpose of funding. The differences in project quality are largely explained by observable attributes of the projects and research teams, suggesting that the NIH may use these attributes as cues for discerning underlying project quality. In addition, ARRA projects are more likely than regular projects to involve investigators with past grant experience. Many of these inter-group differences are specific to R01 grants, the largest funding category in the NIH. Overall, these results suggest that the NIH's project selection appears generally in line with its purported mission. In particular, our results contrast starkly with the frequent criticism that the NIH is extremely risk-averse and unwarrantedly favors experienced investigators. We discuss the implications of our findings on the NIH's behavior in project selection.
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Advice Taking, Learning, and Technology Adoption: Results from an Economic Experiment with Farmers
Bradford Barham et al.
University of Wisconsin Working Paper, May 2015
Abstract:
This paper examines the complementarities between advice taking and individual learning in technology adoption. We run an economic experiment with US farmers measuring their individual learning ability and their propensity to take advice. We then compare the decisions they make in the experiments with their real-world adoption of genetically modified (GM) corn and soy seeds. The first adopters are those who are both quite able cognitively and disinclined to take advice. We find evidence that individual ability and advice taking from external sources of information are substitutes rather than complements in the agricultural technology decision-making process.
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China's "Great Leap Forward" in Science and Engineering
Richard Freeman & Wei Huang
NBER Working Paper, April 2015
Abstract:
In the past two decades China leaped from bit player in global science and engineering (S&E) to become the world's largest source of S&E graduates and the second largest spender on R&D and second largest producer of scientific papers. As a latecomer to modern science and engineering, China trailed the US and other advanced countries in the quality of its universities and research but was improving both through the mid-2010s. This paper presents evidence that China's leap benefited greatly from the country's positive response to global opportunities to educate many of its best and brightest overseas and from the deep educational and research links it developed with the US. The findings suggest that global mobility of people and ideas allowed China to reach the scientific and technological frontier much faster and more efficiently.
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Karla Mendoza-Abarca, Sergey Anokhin & César Zamudio
Journal of Business Venturing, forthcoming
Abstract:
This study takes a population ecology perspective to uncover the influence that social venture creation exerts on commercial venture creation. Data from 88 Ohio counties during 2003–2007 uncovered a negative relationship suggesting that social ventures compete for resources with commercial ventures at the time of founding. Additionally, we found that income levels in the county affected the inter-population dynamics between social and commercial ventures. Specifically, lower income levels exacerbated the competitive relationship between social and commercial ventures. Low levels of government spending on welfare were found to suppress commercial start-up rates.
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It's Good to be First: Order Bias in Reading and Citing NBER Working Papers
Daniel Feenberg et al.
NBER Working Paper, May 2015
Abstract:
Choices are frequently made from lists where there is by necessity some ordering of options. In such situations individuals can exhibit both primacy bias towards the first option and recency bias towards the last option. We examine this phenomenon in a particularly interesting context: consumer response to the ordering of economics papers in an email announcement issued by the National Bureau of Economic Research (NBER). Each Monday morning Eastern Standard Time (EST) the NBER issues a "New This Week" (NTW) email that lists all of the working papers that have been issued in the past week. This email goes to more than 23,000 subscribers, both inside and outside academia, and the placement order is based on random factors. We show that despite the randomized list placement, papers that are listed first each week are about 30% more likely to be viewed, downloaded, and cited over the next two years. Lower ranking on the list leads to fewer views and downloads, but not cites; however, there is also some recency bias, with the last paper listed receiving more views, downloads and cites. The results are robust to a wide variety of specification checks and are present for both all viewers/downloaders, and for academic institutions in particular. These results suggest that even among expert searchers, list-based searches can be manipulated by list placement.
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On the global supply of basic research
Hans Gersbach & Maik Schneider
Journal of Monetary Economics, forthcoming
Abstract:
In a two-country Schumpeterian growth model, we study the incentives for basic research investments by governments in a globalized world. A country's basic research investments increase with the country's level of human capital and decline with its own market size. This may explain why some smaller countries invest so much in basic research. Compared with the optimal investments achievable when countries coordinate their basic research policies, a single country may over-invest in basic research. However, the total amount of decentralized basic research investments is always below the socially optimal investment level, which justifies policy coordination in this area.
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Necessity Is the Mother of Invention: Input Supplies and Directed Technical Change
Walker Hanlon
Econometrica, January 2015, Pages 67–100
Abstract:
This study provides causal evidence that a shock to the relative supply of inputs to production can (1) affect the direction of technological progress and (2) lead to a rebound in the relative price of the input that became relatively more abundant (the strong induced-bias hypothesis). I exploit the impact of the U.S. Civil War on the British cotton textile industry, which reduced supplies of cotton from the Southern United States, forcing British producers to shift to lower-quality Indian cotton. Using detailed new data, I show that this shift induced the development of new technologies that augmented Indian cotton. As these new technologies became available, I show that the relative price of Indian/U.S. cotton rebounded to its pre-war level, despite the increased relative supply of Indian cotton. This is the first paper to establish both of these patterns empirically, lending support to the two key predictions of leading directed technical change theories.
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The Academic Advantage: Gender Disparities in Patenting
Cassidy Sugimoto et al.
PLoS ONE, May 2015
Abstract:
We analyzed gender disparities in patenting by country, technological area, and type of assignee using the 4.6 million utility patents issued between 1976 and 2013 by the United States Patent and Trade Office (USPTO). Our analyses of fractionalized inventorships demonstrate that women's rate of patenting has increased from 2.7% of total patenting activity to 10.8% over the nearly 40-year period. Our results show that, in every technological area, female patenting is proportionally more likely to occur in academic institutions than in corporate or government environments. However, women's patents have a lower technological impact than that of men, and that gap is wider in the case of academic patents. We also provide evidence that patents to which women — and in particular academic women — contributed are associated with a higher number of International Patent Classification (IPC) codes and co-inventors than men. The policy implications of these disparities and academic setting advantages are discussed.
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The Career Effects of Scandal: Evidence from Scientific Retractions
Pierre Azoulay, Alessandro Bonatti & Joshua Krieger
NBER Working Paper, May 2015
Abstract:
Scandals permeate social and economic life, but their consequences have received scant attention in the economics literature. To shed empirical light on this phenomenon, we investigate how the scientific community's perception of a scientist's prior work changes when one of his articles is retracted. Relative to non-retracted control authors, faculty members who experience a retraction see the citation rate to their articles drop by 10% on average, consistent with the Bayesian intuition that the market inferred their work was mediocre all along. We then investigate whether the eminence of the retracted author, and the publicity surrounding the retraction, shape the magnitude of the penalty. We find that eminent scientists are more harshly penalized than their less-distinguished peers in the wake of a retraction, but only in cases involving fraud or misconduct. When the retraction event had it source in "honest mistakes," we find no evidence of differential stigma between high- and low-status faculty members.
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Will Gervais et al.
Social Psychological and Personality Science, forthcoming
Abstract:
If psychologists have recognized the pitfalls of underpowered research for decades, why does it persist? Incentives, perhaps: underpowered research benefits researchers individually (increased productivity), but harms science collectively (inflated Type I error rates and effect size estimates but low replication rates). Yet, researchers can selectively reward power at various scientific bottlenecks (e.g., peer review, hiring, funding, and promotion). We designed a stylized thought experiment to evaluate the degree to which researchers consider power and productivity in hiring decisions. Accomplished psychologists chose between a low sample size candidate and a high sample size candidate who were otherwise identical. We manipulated the degree to which participants received information about (1) productivity, (2) sample size, and (3) directly calculable Type I error and replication rates. Participants were intolerant of the negative consequences of low-power research, yet merely indifferent regarding the practices that logically produce those consequences, unless those consequences were made quite explicit.
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The Replication Paradox: Combining Studies can Decrease Accuracy of Effect Size Estimates
Michèle Nuijten et al.
Review of General Psychology, forthcoming
Abstract:
Replication is often viewed as the demarcation between science and nonscience. However, contrary to the commonly held view, we show that in the current (selective) publication system replications may increase bias in effect size estimates. Specifically, we examine the effect of replication on bias in estimated population effect size as a function of publication bias and the studies' sample size or power. We analytically show that incorporating the results of published replication studies will in general not lead to less bias in the estimated population effect size. We therefore conclude that mere replication will not solve the problem of overestimation of effect sizes. We will discuss the implications of our findings for interpreting results of published and unpublished studies, and for conducting and interpreting results of meta-analyses. We also discuss solutions for the problem of overestimation of effect sizes, such as discarding and not publishing small studies with low power, and implementing practices that completely eliminate publication bias (e.g., study registration).
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Eric Igou & Wijnand van Tilburg
Frontiers in Psychology, April 2015
Abstract:
Middle name initials are often used by people in contexts where intellectual performance matters. Given this association, middle initials in people's names indicate intellectual capacity and performance (Van Tilburg and Igou, 2014). In the current research, we examined whether middle initials are associated with a typical academic indicator of intellectual performance: authorship order of journal articles. In psychology, authorship early in the author list of an article should correspond with greater contribution to this intellectual endeavor compared to authorship appearing later in the author list. Given that middle initials indicate intellectual capacity and performance, we investigated whether there would be a positive relationship between middle initials in author names and early (vs. late) appearance of names in author lists of academic journal articles in psychology. In two studies, we examined the relationship between amount of authors' middle initials and authorship order. Study 1 used a sample of 678 articles from social psychology journals published in the years 2006 and 2007. Study 2 used a sample of 696 articles from journals of multiple sub-disciplines in psychology published in the years from 1970 to 2013. Middle initials in author names were overrepresented early (vs. late) in author lists. We discuss implications of our findings for academic decisions on authorship orders, potential avenues of further investigation, and applications.
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Brian Philip Reschke, Pierre Azoulay & Toby Stuart
University of California Working Paper, May 2015
Abstract:
When an actor experiences a sudden gain in status — for example, when a scientist wins a Nobel Prize, or a film director wins an Oscar — what does this jump in status do to the fates of the winner's many 'neighbors'? Do non-winners bask in the reflected glory of the winner, and therefore rise with her? Or conversely, does competition for attention ensue, attenuating the recognition neighbors otherwise would have received? We investigate this question in the scientific community. Using article keywords assigned by third-party experts, we identify articles highly related to publications by eventual appointees to the prestigious Howard Hughes Medical Institute (HHMI). We find that, on average, these 'neighbor articles' experience a substantial decline in citation rates after HHMI appointments are announced, relative to controls. That is, neighbors receive substantially less attention when a focal actor receives a prestigious prize. While this negative spillover effect dominates our findings, it is not absolute. For instance, neighbors are shielded from the negative effect if they share a direct social connection with a prize winner. Also, in areas of science in which endorsements are particularly valuable, such as novel fields of research, the spillover effect of a neighbor's prize is instead positive.