RPI Economics Seminar - The Performance of U.S. Research Joint Ventures: Reference Points, Moral Hazard, and Uncertainty

 

RPI Economics Seminar - The Performance of U.S. Research Joint Ventures: Reference Points, Moral Hazard, and Uncertainty

Sage 3205

December 5, 2012 3:30 PM - 5:00 PM

Abstract: The number of formal and informal research joint ventures (RJVs) has been increasing over time both in the United States and in other industrialized nations.  However, few scholars have examined empirically the economic performance of the RJVs.  This lack of research remains puzzling from a public accountability perspective.  The performance of RJVs contributes to producer surplus from the perspective of partnering firms and to social surplus from the perspective of governments that fund these arrangements. In this paper we examine empirically several performance measures reported by 397 companies involved in 142 RJVs between 1991, and early 2001 that were funded by the Department of Commerce's Advanced Technology Program.  Motivating our analyses is the extant literature on research partnerships and property rights economics.  We find that (1) RJVs engaged in research that sets a new direction for industry are more successful as measured in terms of achieving technical goals and in yielding greater revenues and expecting to do the same in the future; (2) the size of the RJV, measured in terms of number of members, has little impact on the performance of the RJV with the exception that members of larger RJVs have a more optimistic outlook on the likelihood for future revenues than do smaller RJVs perhaps reflecting a realization of research synergies among the members that have yet to be realized; (3) founders of an RJV perceive that their RJV has performed more successfully than non-founders for every performance measure considered; and (4) the more ambitious the research goals of the RJV the greater the current and expected future revenues from improved products, and the more willing to protect those revenue streams through patents.


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