Working Paper: NBER ID: w20889
Authors: Pierre Azoulay; Joshua S. Graff Zivin; Danielle Li; Bhaven N. Sampat
Abstract: We quantify the impact of scientific grant funding at the National Institutes of Health (NIH) on patenting by pharmaceutical and biotechnology firms. Our paper 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 2.3 patents. Though valuing patents is difficult, we report a range of estimates for the private value of these patents using different approaches.
Keywords: Public R&D; Private-Sector Patenting; NIH Funding
JEL Codes: O3; O33; O38
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| NIH funding (I23) | number of patents produced by private sector firms (O39) |
| NIH funding (I23) | number of patents in the same primary disease area (L65) |
| NIH funding (I23) | number of patents in different disease areas (L65) |
| NIH funding (I23) | cross-disease spillover effects in patenting (O36) |