Journal of Business Venturing Insights 12 (2019) e00135

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Journal of Business Venturing Insights

journal homepage: www.elsevier.com/locate/jbvi

Political climate and academic entrepreneurship: The case of

strange bedfellows?
Peter T. Gianiodis a, *, William R. Meek b, Wendy Chen c
a
Palumbo Donahue School of Business, Duquesne University, Pittsburgh, PA 15282, USA
b
Department of Management/Marketing, School of Business Administration, University of Dayton, Dayton, OH 45469, USA
c
School of Public Policy, George Mason University, Arlington, VA 22201, USA

A R T I C L E I N F O A B S T R A C T

Keywords: Universities have fully embraced academic entrepreneurship, transforming their structures, sys-
Academic entrepreneurship tems, and processes to generate licensing revenues and create new ventures. While prior research
Entrepreneurial university has mainly focused on the relationship between public policy and entrepreneurial activities, this
Political climate
study examines a major gap – the performance implications of regional politics on academic
Regional economic development
State elections
entrepreneurship. We use a unique data set of U.S. universities and their regional governments to
test how the influence of two elements of a region's political climate – consensus and stability –
affects entrepreneurial and commercial performance. Our results suggest that political consensus
and stability are positively associated with higher licensing revenues, while political stability is
negatively associated with new venture creation. Our results reveal how regional politics influence
university commercial outcomes, which suggests that entrepreneurship-enhancing public policy is
intimately linked to the regional political process. We discuss the implications for theory and
practice, and suggest possible future research directions.

1. Introduction

Universities increasingly are embedded in regional innovation systems, helping to mobilize diverse stakeholders to ensure successful
commercial outcomes (e.g. Kirchberger and Pohl, 2016). By adopting the entrepreneurial model, universities now explicitly mandate and
incentivize entrepreneurial behavior. They use technology commercialization offices (TCOs) to execute this mandate, by managing
complex relationships between competing stakeholders (Perkmann et al., 2013). This is not a trivial mandate, as many stakeholders –
faculty, administrators, commercial partners, politicians and government bureaucrats, etc. – exert influence. This is especially acute for
universities facing declining government funding (c.f. Hicks, 2012; Palacios et al., 2013), even though only the most prominent uni-
versities (e.g. MIT, Cambridge, etc.) have strong commercialization and entrepreneurial records (e.g. AUTM surveys). Because many
universities view entrepreneurial and commercialization activities as a possible remedy for revenue challenges, there are likely to be
policy concerns when uneven returns across universities persist (Grimaldi et al., 2011; O'kane et al., 2015).
Research has examined many factors that explain performance variation in implementing entrepreneurial and commercial activities
(cf. Link et al., 2015; Perkmann et al., 2013; Rothaermel et al., 2007, for reviews of the literature). While researchers have examined the
influence of national government policy, in this study we scrutinize the importance of regional political climate on variation of com-
mercial outcomes (cf. Huggins and Kitagawa, 2012 for an exception). In particular, we empirically examine how two components of a

* Corresponding author.
E-mail addresses: gianiodisp@duq.edu (P.T. Gianiodis), wmeek1@udayton.edu (W.R. Meek), dchen16@gmu.edu (W. Chen).

https://doi.org/10.1016/j.jbvi.2019.e00135
Received 8 April 2019; Received in revised form 18 June 2019; Accepted 19 June 2019
2352-6734/© 2019 Elsevier Inc. All rights reserved.
P.T. Gianiodis et al. Journal of Business Venturing Insights 12 (2019) e00135

region's political environment – consensus (i.e. one party hegemony) and (in)stability (i.e. change of power) – affect the university's
commercial and entrepreneurial performance. To our knowledge, this is one of the first studies to examine the political
climate-performance relationship in the university context (e.g. Kirchberger and Pohl, 2016).
Extending empirical research, the goal of this study is to highlight the link between U.S. state-level elections and university
entrepreneurial activity, as state politicians often are critical stakeholders in the regional entrepreneurial university nexus. State gov-
ernments provide not only financial support, but enact specific policies to help build entrepreneurial ecosystem capabilities and foster
economic development (Grimaldi et al., 2011; Link et al., 2015). This study specifies how different political climate attributes –
consensus and stability – influence the two principle commercial outcomes – licensing revenue generation and start-up creation. While
restricted to the U.S. context, we believe this study's findings generalize to regions in other countries because the impact of a region's
political climate on university entrepreneurship is salient (Audretsch and Goktepe-Hulten, 2015). In the following section, we review
recent research on university-based commercialization. Next, we detail the methods for testing the relationships of interest. Finally, we
conclude with a discussion the implications for policy and future research.

2. Political climate and university entrepreneurship

Universities increasingly are a fulcrum within entrepreneurial ecosystems, acting as a catalyst for regional economic activity. Past
research has examined how national policy influences university entrepreneurial behavior (e.g. Link et al., 2015; Siegel, 2006). Yet, the
impact of national policy-making has limits; there is heterogeneity in terms of regional implementation of national policies (Acs and
Varga, 2005; Brown et al., 2016). Further, research on agglomeration suggests that regional differences explain variation in outcomes
highlighting how barriers to implementation, such as the resistance by powerful stakeholder groups, may be present (Ellison and
Glaeser, 1999). Funding decisions in the U.S. provides evidence to support this contention; they are a source of political discourse as
salient stakeholders ensure programs such as secondary education, healthcare, welfare, and corrections are consistently funded
(Okunade, 2004). For example, since the mid 1980's federal government funding for higher education in the U.S. has decreased by more
than 60% (McClendon et al., 2009), and large deficits and debt have decreased the government's capacity to provide adequate resources
(Archibald and Feldman, 2006). This has pushed a greater financial burden on regional governments and universities prompting them to
seek alternative revenue streams (Dar and Lee, 2014).
Universities often are battlegrounds for shaping public policy, as influential institutions and stakeholders clash (e.g. Dar, 2012).
Regional governments may enjoy the stability of one-party rule or instability, subject to electoral change. In the case of the latter, these
contested locales are subject to heated philosophical debates about the role of government in society, which may result in political
theater and stalemates. Thus, divided regional governments may be subject to ideological entrenchment and legislative impasse on
important topics such as the role of higher education in regional economic development (Dar and Lee, 2014).
By contrast, under one party control, certain topics and constituencies tend to exert disproportionate influence (Schwartz, 2008). For
example, in localities with aging populations spending priorities for seniors, a well-known voting bloc, often take precedent over other
needs (Kane et al., 2005). There is less uncertainty when one party dominates, as the party in power pass legislation with little regard for
competing viewpoints. The regional political climate may influence university entrepreneurial behavior and outcomes; for example, the
type of commercialization these universities pursue –licensing to large firms vs. equity-based agreements with local start-ups or spinoffs
– may be contingent upon political influence. Political hegemony suggests a salient stakeholder block, which can exert influence on
universities to seek lower risk commercialization activities such as licensing (cf. Bray and Lee, 2000). Whereas a balanced political
environment may affect university-local government relations; priorities are likely to change, as any bargaining power generated in the
previous administration is devalued. In this study, we empirically test these arguments and ask the following research question:
Research Question: In the context of university-based entrepreneurial and commercial performance, what is the impact of the
universities' regional political climate?
Prior to explaining the methodology employed in this study, one clarifying boundary condition. Prior research has examined how
political ideology influences important government functions such as taxation and the funding of social services (Bjørnskov and
Potrafke, 2013; Ma, 2017; Potrafke, 2011; Wang et al., 2019). We acknowledge the importance of political ideology in shaping a region's
political climate; however, we are purposely agnostic regarding the political ideology of the parties controlling the executive and
legislative branches of state government. Therefore, this study is about political influence irrespective of political philosophy.

3. Methods

3.1. Sample

In this study, we investigate the influences of the political climate on two critical entrepreneurial university outcomes: licensing
revenue and new startups created. We used three overlapping, yet distinctive sampling frames: (1) Doctoral-granting universities ac-
cording to Carnegie Classification designation, (2) Land-grant colleges and universities, and (3) universities taking part in the AUTM
Licensing Activity Survey at least once during the fifteen-year period from 2002 to 2016. This yielded 253 U.S. universities. We deleted
universities from our sample for the following reasons: (1) State systems – (e.g. State University of New York, SUNY, schools like Buffalo,
Stony Brook, etc.) –difficult to delineate university versus system-level performance; (2) medical schools (e.g. Thomas Jefferson); (3)
limited research scope, and/or (4) universities in Nebraska – it has a non-partisan unicameral state legislature. Our final sample is 189.

2
 P.T. Gianiodis et al.
Table 1
Summary statistics: means, standard deviations and correlations.
Mean S.D 1 2 3 4 5 6 7 8 9 10 11 12a 12b

1. Licensing revenue (log with 2-yr avg.) 7.463 9.111

2. New Ventures (log with 2-yr avg.) 2.601 3.588 .58
3. Private/Public (1/0) 0.738 0.440 -.27 -.23**
4. University Age 143.08 98.708 .33** .05 .01
5. Land-grant (1/0) 0.455 0.337 .12 .25 .36** .22*
6. Bayh-Dole Dummy (1/0) 0.131 0.098 .28* .15 .09 -.18* -.05
3

7. TCO Size 5.698 4.003 .44** .41** .11 .26* -.21* .08
8. AUTM-Participation 0.717 0.462 .51** .55** .41** .42** .05 .32** .04
9. Royalty Payments 0.379 0.281 .43** .13 .10 .34** -.19* .06 .23* .01
10. Urban/Rural (1/0) 0.736 0.422 .19 .06 .14 .12 .08 .38** .19* .04 .11
11. Human Develop Index 4.927 3.335 .08 .11 .06 .25* .18 -.08 -.01 -.04
17* .09
12. Political Consensus 0.688 0.479 .22* -.08 .03 .02 .04 .17* -.01 -.01 .02 -.24* .05
13a. Political Stability (0/1) 0.791 0.559 .34** -.28** -.02 -.01 -.00 -.04 .09 .08 -.01 .02 -.05 .12
13b. Political Stability (5-pt Likert Scale) 1.743 0.982 .25* -.21* -.01 -.03 -.00 -.03 .14 .11 -.03 .01 -.05 .08 .00

(N ¼ 1323; 189 Universities X 7 Election Cycles).

Journal of Business Venturing Insights 12 (2019) e00135

* p < 0.05 and ** p < 0.01.
P.T. Gianiodis et al. Journal of Business Venturing Insights 12 (2019) e00135

3.2. Measures

We employed two distinctive measures of commercial performance used extensively in the academic entrepreneurship literature (cf.
Link et al., 2015): licensing revenue and new venture generation. We collected archival data from two sources: 1) AUTM Licensing Activity
Survey (2002–2017) and 2) university TCO websites.
For the predictor variables, we constructed two measures to proxy the influence of a university's political climate. The first measure,
(Political-Consensus), is a dummy variable where ‘1’ denotes a state with one-party rule (i.e. Democratic governor and Democratic-
controlled legislature), and ‘0’ denotes a state with split political rule (i.e. Democratic governor and Republican-controlled legisla-
ture or vice-a-versa). This is a salient measure given the disputed 2000 presidential contest between George W. Bush and Al Gore, which
has intensified an already hardened political landscape in the U.S. at both the national and regional level.
For the second predictor, (Political Stability), we constructed two different measures. The first is a dummy variable where ‘1’ rep-
resents states that have undergone at least one change in power in the executive and/or legislative branches since 2000 (e.g. Democratic
incumbent governor defeated by a Republican candidate in the 2008 election), and ‘0’ if there was no change in power. This measure
focuses only on political power change. The second measure is a 5-point Likert Scale, from no change (1) to several changes (5). This
measure better specifies the extent of change to the political climate during the study period. State elections are not uniform across states
and years; most states' gubernatorial election cycle is every four years, while the legislative cycles are every two (lower house) and four
(upper house) years. These data were collected from Ron Gunzburger's Politics1 website, which captures U.S. political data at the na-
tional, state, and regional levels. To triangulate this source, we also searched individual states' websites.
We employed three controls at the organizational level and four at the sub-organizational level: private/public, university age, land-
grant, and, Bayh-Dole, university royalty payments to scientists, and TCO size. For private/public, we created a dummy variable for university
affiliation with private universities labeled (1) and public universities (0). For university age, we calculated the number of years since the
university's founding up until 2018. Lastly, we constructed a dummy variable to measure a university's land-grant status: first, ‘1’ if there
is a land -grant designation or ‘0’ if not (land-grant). We added one other organizational level control variable, university endowment, but
dropped it from the analysis because it was highly correlated with university age.
At the sub-organizational level, we constructed a dummy variable (Bayh-Dole) to determine if the TCO was active prior to (1) or after
(0) the Bayh-Dole Act of 1980. For TCO size, we measured the number of FTE reported during the last year, 2018, of the AUTM Survey.
We created a dummy variable to measure if the university adopted an independent TCO structure (TCO-Adoption), a form of institu-
tionalization of a university's entrepreneurial model, universities with independent TCO's were labeled (1) and ones embedded in the
Research Office were (0). Lastly, for royalty payments to scientists, we followed Markman and his colleagues (2009), who used the
percentage of licensing royalty payments paid directly to scientists.
We used two additional measures to control for environmental effects. First, to control for agglomeration effects, we created a
dummy variable (Urban-Rural) where ‘1’ represents universities located in or adjacent to an urban county (i.e. more than 1,000 persons
per square mile), and ‘0’ for those located in rural counties (i.e. less than 1,000 persons per square mile). Second, we used a human
development index to capture the relative economic health of the state. We averaged the indices reported in The Measure of America
2008–2009, 2010–2011, and 2013–14 (Burd-Sharps and Lewis, 2011).

3.3. Data analysis and results

We employed two hierarchical regression analyses: one predicting licensing revenues and the other predicting the number of new
ventures spun-off from university IP. Table 1 summarizes the descriptive statistics and correlation matrix of variables used in the
analysis.
As noted above, the electoral cycles run on two and four-year cycles, with all governorships contested at least once during the four-
year cycle, and over 80% of legislative seats contested during the two-year cycle and the remaining seats contested during the four-year
cycle. There do exist “off-cycle” or special elections at the state level, but during the study timeframe, these special elections averaged
less than 1% of legislative seats per year, with only a few gubernatorial contests. Thus, we analyzed the relationship using the two-year
election cycle – seven complete cycles, 2002, 2004, 2006, 2008, 2010, 2012, 2014. To align our two university performance variables –
licensing revenue and new venture generation – with the two-year political cycles, we used two-year averages. To model expected
change after an election cycle, we lagged our performance data to better reflect how changes to political consensus and stability in-
fluences subsequent performance. For this study, we assumed that university entrepreneurial behavior would lag changes to the regional
political climate, and that this change would likely dissipate over time. For example, in the 2010 election cycle, we used the average of
2011 and 2012 performance data.
Table 2a summarizes the regression analyses for licensing revenues and the number of new ventures formed. All significance values
reported in regression tables were based on heteroscedasticity - robust adjusted standard error. All continuous variables were winsorized
at the 1 and 99 percent level to avoid the influence of extreme values. Prior to the analysis, we performed a variance inflation factor (VIF)
test to check for multicollinearity and found all the VIFs were well below 10, which is the acceptable range in the literature.
Models 1 and 5 include only the control variables. Model 1 and 5 show that TCO size, AUTM participation and Urban location are
strongly associated with licensing revenue and new venture creation; whereas Model 5 shows that University age is negatively asso-
ciated with new venture creation. These models account for 41 percent of the variance in licensing revenues and 35 percent of the
variance in new venture creation, respectively.
The full models (3 and 7) show mostly robust results. Political consensus is associated with higher licensing revenues (0.122,
p < 0.01), but there is no statistical relationship for new venture creation (
0.031). Likewise, political stability is associated with higher

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P.T. Gianiodis et al. Journal of Business Venturing Insights 12 (2019) e00135

Table 2a
Results of hierarchical regression analysis on commercialization activity.
Controls Commercialization Outcomes

Licensing Revenues (Log) New Venture Creation (log)

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6 Model 7 Model 8

Controls 1-year 2-year 3-year Controls 1-year 2-year 3-year

Private/Public (1/0) 0.044* 0.089** 0.113*** 0.053*
0.029
0.031
0.034
0.040
University Age
0.117*
0.087
0.092
0.074
0.116**
0.102*
0.141***
0.129***
Land-grant (1/0)
0.168**
0.096
0.113*
0.122*
0.088
0.044
0.037
0.039
Bayh-Dole Dummy (1/0)
0.117**
0.101*
0.122**
0.099*
0.037
0.034
0.011
0.016
TCO Size 0.309*** 0.299*** 0.401*** 0.331** 0.229*** 0.208*** 0.185*** 0.194***
AUTM Participation 0.402**** 0.371**** 0.388**** 0.348*** 0.208*** 0.196*** 0.193*** 0.211***
Royalty Payments
0.044
0.016
0.009
0.027
0.089
0.078
0.064
0.069
Urban/Rural (1/0) 0.209*** 0.198** 0.181*** 0.174** 0.344**** 0.351**** 0.348**** 0.333****
Human Develop. Index 0.056* 0.118* 0.132** 0.136** 0.221** 0.232** 0.256*** 0.242**
Predictors
Political Consensus 0.111* 0.122* 0.127*
0.017
0.031
0.078
Political Stability (0/1) 0.055 0.208*** 0.155**
0.098*
0.297***
0.163**
Interaction
Polit. Consensus x Polit Stability
0.045
0.066
0.051
0.011
0.017
0.008
Adjusted R2 0.41 0.47 0.51 0.48 0.35 0.41 0.44 0.40
Change in Adjusted R2 0.06* 0.10*** 0.07** 0.06*** 0.09*** 0.05***
F 23.96**** 17.77**** 19.33**** 18.56**** 20.32**** 15.54**** 16.23**** 16.02****

Notes: Values are standardized regression coefficients (N ¼ 1323; 189 Universities X 7 Election Cycles, expect for Models 4 and 8); given the nature of
our dependent variables, we also run negative binomial regression. The results were very similar, so they are not reported here.
Standard errors in parentheses; * p < 0.1,** p < 0.05, *** p < 0.01, **** p < 0.001.

licensing revenues, but it is negatively associated with new venture creation (0.208, p < 0.001;
0.297, p < 0.001). Lastly, the political
climate interaction terms – consensus-stability – yielded no significant results. In all, we find that the two measures of political climate are
important predictors of university commercial performance; they explained an additional 10 percent (p < 0.001) of the variance in
revenues and 9 percent (p < 0.001) of the variance in venture creation, respectively.

3.4. Robustness checks

We conducted three robustness checks to enhance the validity of our findings. First, research in policy and legal studies suggests that
uncertainty related to an upcoming election cycle may cause actors (i.e. scientists) in bureaucratic organizations (i.e. universities) to
delay action (e.g. Cairns et al., 2016), so we tested one-year and three-year lag effects. Models 2, 4, 6 and 8 in Table 2a report these
findings. The effects are similar across the four tests; however, the two-year lag has the greatest predictive value. Thus, entrepreneurial
behavior may actually “change” prior to any subsequent political change. Our analysis provides some evidence for the former – political
then actor change – rather than the latter – actor then political change.
Second, we tested an alternative measure for political stability - a 5-point Likert Scale with the following criteria: 1 ¼ no change, 2 ¼ 1
change, 3 ¼ 2 changes, 4 ¼ 3 changes, and 5 ¼ 4 or more changes (note: only 2 states had 4 þ changes from 2002 to 2014). Findings,
shown in Table 2b, are similar to those using the dichotomous (0/1) measure of political stability, but overall less predictive. While this
measure better models the magnitude of change to the political climate during the study period, findings suggest that just a single
change has greater effect on subsequent university entrepreneurial performance than multiple changes (i.e. a single change is relatively
independent of any prior changes).
Lastly, we also wanted to better account for any possible error related to our lagged performance measures, so we experimented with
3-year averages and rolling averages. These findings are not presented because they yield similar results to the other tests.

4. Discussion

In this research, we explored the relationship between regional political climate and university-based commercial activity. We found
that political stability is strongly linked to both performance outcomes, while political consensus is only associated with licensing
revenues. These relationships exist even when controlling for other university and environmental-level factors.

4.1. Theoretical implications

Understanding how universities successfully commercialize their inventions has received significant attention by many scholars
studying economics, business and public policy (cf. Hayter et al., 2018). While research has investigated regional differences, generally
through the agglomeration lens, it has focused less on the micro-foundations of the political economy (cf. Benner and Sandstr€ om, 2000;
Huggins and Kitagawa, 2012). Our research findings highlight how entrepreneurship-enhancing policies are intimately linked with
regional politics. Although these findings are not novel (e.g. higher education funding, cf. Dar and Lee, 2014), this is one of the first

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P.T. Gianiodis et al. Journal of Business Venturing Insights 12 (2019) e00135

Table 2b
Results of hierarchical regression analysis on commercialization activity.
Controls Commercialization Outcomes

Licensing Revenues (Log) New Venture Creation (log)

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6 Model 7 Model 8

Controls 1-year 2-year 3-year Controls 1-year 2-year 3-year

Private/Public (1/0) 0.044* 0.079** 0.133*** 0.068*
0.029
0.018
0.021
0.017
University Age
0.117*
0.044
0.066
0.054
0.116**
0.149**
0.155**
0.142**
Land-grant (1/0)
0.168**
0.066
0.118*
0.127*
0.088
0.009
0.017
0.023
Bayh-Dole Dummy (1/0)
0.117**
0.097*
0.120*
0.116*
0.037
0.031
0.026
0.021
TCO Size 0.309*** 0.244*** 0.277*** 0.188** 0.229*** 0.223*** 0.214*** 0.202***
AUTM Participation 0.402**** 0.355**** 0.372**** 0.293*** 0.208*** 0.211*** 0.197*** 0.205***
Royalty Payments
0.044
0.022
0.015
0.024
0.089
0.042
0.057
0.046
Urban/Rural (1/0) 0.209*** 0.184** 0.191*** 0.162** 0.344**** 0.302**** 0.325**** 0.349****
Human Develop. Index 0.056* 0.101 0.128* 0.131* 0.221** 0.156** 0.166*** 0.147**
Predictors
Political Consensus 0.107* 0.118* 0.129*
0.014
0.053
0.036
Political Stability (5-pt Likert) 0.098* 0.109* 0.103*
0.077
0.124*
0.117*
Interaction
Polit. Consensus x Polit Stability
0.039
0.062
0.049
0.013
0.016
0.010
Adjusted R2 0.41 0.44 0.49 0.46 0.35 0.30 0.42 0.41
Change in Adjusted R2 0.03* 0.08*** 0.05* 0.04** 0.07** 0.06**
F 23.96**** 16.45**** 19.02**** 17.36**** 20.32**** 16.99**** 17.31**** 16.55****

Notes: Values are standardized regression coefficients (N ¼ 1323; 189 Universities X 7 Election Cycles, expect for Models 4 and 8); given the nature of
our dependent variables, we also run negative binomial regression. The results were very similar, so they are not reported here.
Standard errors in parentheses; * p < 0.1, ** p < 0.05, *** p < 0.01, **** p < 0.001.

studies to reveal how political climate is associated with performance outcomes.

Our results add contextual nuances to previous research that investigated the government engagement with the academic entre-
preneurship model (cf. Miller et al., 2014). While research on academic entrepreneurship has matured, employing more sophisticated,
multi-level models, it still has a tendency to aggregate much of the “noise” related to this idiosyncratic phenomenon (cf. Pitsakis et al.,
2015). Our findings suggest that future research is in need of disaggregation; investigating all relevant stakeholders and how they
directly (and indirectly) influence university-based entrepreneurial behavior. The findings also speak to research on political activism
and economic development; a highly stable, partisan dominated political climate is associated with better returns through licensing
revenues, but less new venture creation. Further, the findings suggest that any change in political power (i.e. to provide balance across
government branches) may yield better societal outcomes. This suggests researchers studying university-led regional economic
development need to consider the micro-foundations of political climate in their models; it may be the case that universities in regions
with an entrenched, deep-seated political class are susceptible to influences beyond the stated national policies.

4.2. Managerial and policy implications

Research highlights how salient stakeholders within an entrepreneurial university have conflicts of interest (Markman et al., 2009;
Shane, 2001), often rooted in disclosure invariance (i.e. proprietary vs. non-proprietary disclosure) or investment (i.e. short vs.
long-term horizon) invariance (cf. Perkmann et al., 2013; Rothaermel et al., 2007). Research provides mechanisms for university ad-
ministrators to manage these complexities including aligning structures and incentive systems, while being cognizant of how cultural
norms and stakeholder identity change over time (cf. Fini et al., 2010; Meek and Wood, 2016; Thursby et al., 2009). Conflicts also exist
with external stakeholders; for example, firms, financial intermediaries (e.g. angel investors), and (surrogate) entrepreneurs often wish
to gain exclusive access to promising innovations when licensing them (Audretsch et al., 2012). Our findings may refocus university
administrators' attention to external stakeholders, especially how they manage regional political actors.
If the political climate matters, as our findings suggest, then engaging in both formal and informal stakeholder engagement is
imperative (cf. Mitchell et al., 1997). This can take several different forms. For example, university presidents generally meet with
politicians and attend legislative sessions; however, they may have to commit greater time and resource commitment to align regional
governments' priorities with university goals. Adding current and past politicians from each political party to leadership positions (e.g.,
board of trustees/advisors) can be an effective lever, even when they are not university alumni. Furthermore, university administrators
may be underutilizing alumni, who can directly (i.e. if sitting politicians) and indirectly (i.e. if influential stakeholders) affect the
political climate. The first step is a long-term, coordinated political strategy at the regional level.
Lastly, our findings confirm that national legislative mandates (e.g. Bayh-Dole Act) may be supplemented by regional initiatives as
prior research has yielded only marginal support that regional initiatives enhance national legislation (Kochenkova et al., 2016; Val-
divia, 2013). This suggests that ignoring the regional political climate by focusing solely on national policy may underspecify the dy-
namics of the regional-national relationship. Interestingly, we do not include a measure of political ideology in our model; as recent
global headlines suggest, political ideology of parties in power are important considerations for university administrators and policy
experts alike, and thus provides a fruitful path for future research.

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4.3. Limitations and future research

Like all studies, ours is not without limitations. This study primarily focused on the impact of state elections on university entre-
preneurship. Therefore, it did not directly study how national politics affect the state political climate, and thus universities' entre-
preneurial and commercial performance. Future research is ripe for multi-level studies of the effect of political influence on the
entrepreneurial university. Specifically, the interrelationship between national and regional policies and politics on entrepreneurial
behavior in university labs.
As noted, this study used only universities and state-level governments in the US, it does not consider the influence that regional
governments can have on universities in other countries. The US federal system of government is unique – with its emphasis on
balancing of federal and state power - and as such, it creates a distinctive environment for influencing universities. Future studies could
engage in cross-country studies to examine how state or regional governments' political climate in other countries influence the uni-
versities behavior and performance.

5. Conclusion

University-based entrepreneurship can transform industries, markets, and societies, as well as directly benefiting many regional
stakeholders. To date, research has mostly trumpeted the benefits that it brings to these communities. This study adds to this con-
versation by examining how regional political climate influences university-based entrepreneurial stakeholders, and ultimately the
university's commercial performance. By identifying the significant effects that local political climate has on university entrepreneur-
ship, this paper describes the complex web of university stakeholders, and provides new insights on how universities can improve their
commercial performance.

Acknowledgements

The authors would like to thank Jill Brown and Gideon Markman for providing feedback on the manuscript. We also thank par-
ticipants in the SAMS/JMS special conference on “Managing Complexity within and Across Organizational Boundaries for providing
excellent feedback. This research did not receive any specific grant from funding agents in the public, commercial, or not-for-profit
sectors.

Appendix A. Supplementary data

Supplementary data to this article can be found online at https://doi.org/10.1016/j.jbvi.2019.e00135.

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