THE ASSOCIATED PRESS/STEvEn SEnnE

Universities in Innovation Networks
The Role and Future Promise of University Research in U.S. Science and Economic Policymaking
Krisztina “Z” Holly January 2012
The fourth report in a series on U.S. science and economic competitiveness from the Doing What Works and Science Progress projects at the Center for American Progress

w w w.americanprogress.org

About this series on U.S. science and economic competitiveness
The U.S. Congress in late 2010 asked the Department of Commerce to complete two studies as part of the reauthorization of the America COMPETES Act. The first, which was released on January 6th, 2012, at the Center for American Progress, focuses on U.S. competitiveness and innovation. The second, due to Congress in early 2013, offers specific recommendations for developing a 10-year national innovation and competitiveness strategy. We applaud the commissioning of these reports but believe we cannot afford to wait that long to take action. That’s why we convened in the spring of 2011 the group of experts listed on the following page. We spent two days in wide-ranging discussion about the competitive strengths and weaknesses of our nation’s scientific endeavors and our economy, before settling upon the topics that constitute the series of reports we publish here. Each paper in the series looks at a different pillar supporting U.S. science and economic competitiveness in a globally competitive economy: • “Rewiring the Federal Government for Competitiveness” • “Economic Intelligence” • “Universities in Innovation Networks” • “Manufacturers in Innovation Networks” • “Building a Technically Skilled Workforce” • “Immigration for Innovation”

The end result, we believe, is a set of recommendations that the Obama administration and Congress can adopt to help the United States retain its economic and innovation leadership and ensure that all Americans have the opportunity to prosper and flourish now and well into the 21st century. Many of our recommendations are sure to spark deep resistance in Washington, not least our proposal to reform a number of federal agencies so that our government works more effectively and efficiently in the service of greater U.S. economic competiveness and innovation. This and other proposals are sure to meet resistance on Capitol Hill, where different congressional committees hold sway over different federal agencies and their policy mandates. That’s why we open each of our reports with this one overarching recommendation: Congress and President Obama should appoint a special commission to recommend reforms that are packaged together for a single up-or-down vote in Congress. In this way, thorough-going reform is assured. This new commission may not adopt some of the proposals put forth in this series on science and economic competitiveness. But we look forward to sharing our vision with policymakers as well as the American people. President Obama gets it right when he says, “To win the future, we will have to outinnovate, out-educate, and out-build” our competitor nations. We need to start now.

Coordinating editors for the series on U.S. science and economic competitiveness
Ed Paisley, Vice President, Editorial, American Progress Gadi Dechter, Associate Director, Government Reform, Doing What Works Sean Pool, Assistant Editor, Science Progress

American Progress taskforce on U.S. science and economic competitiveness
John Alic, science, technology, and economic policy Jonathan Moreno, Editor-In-Chief of Science Progress

consultant and former staff member of the Congressional Office of Technology.
Joseph Bartlett, of counsel in Sullivan & Worcester’s

and Senior Fellow at the Center for American Progress.
Arti Rai, Elvin R. Latty Professor of Law at Duke

corporate department and former undersecretary of commerce at the U.S. Department of Commerce.
Maryann Feldman, S.K. Heninger distinguished chair in

University and former Administrator for External Affairs, USPTO.
Andrew Reamer, research professor at the George

public policy at the University of North Carolina, Chapel Hill.
Kate Gordon, VP for Energy Policy at the Center for

Washington University Institute of Public Policy and non-resident senior fellow at the Brookings Institution.
RoseAnn B. Rosenthal, president and CEO, Ben

American Progress.
Michael Gurau, president, Clear Innovation Partners, a

Franklin Technology Partners of Southeastern Pennsylvania.
Jonathan Sallet, partner in the law firm of O’Melveny

venture capital investment firm.
David Hart, director of the Center for Science and

Technology Policy at George Mason University School of Public Policy.
Christopher Hill, professor of public policy and technol-

& Myers LLP, Science Progress advisor, and former director of the Office of Policy and Strategic Planning of the U.S. Department of Commerce.
Daniel Sarewiz, director of the Consortium for

ogy at George Mason University School of Public Policy and former vice provost for research at George Mason.
Neal Lane, senior fellow for science and technology

Science, Policy, and Outcomes at Arizona State University.
James Turner, Senior Counsel for Innovation &

policy at Rice University and former advisor to the president on science and technology policy.
Rachel Levinson, director of National Research Initiatives

Technology, and Director of Energy programs at the Association of Public and Land-Grant Universities and former professional staff and chief counsel for the House Committee on Science and Technology.
William A. Wulf, professor of computer science at the

at Arizona State University and former assistant director for life sciences at the White House Office of Science and Technology Policy.

University of Virginia and former president of the National Academy of Engineering.

Universities in Innovation Networks
The Role and Future Promise of University Research in U.S. Science and Economic Policymaking
Krisztina “Z” Holly January 2012

Contents

1 Introduction and summary 4 Current state of U.S. investment in innovation 6 Stoking the engine of innovation
6 Shifting investments and the role of universities in research 7 Changing views about the nature and impact of research 8 The importance of transformative research 10 Supporting the next generation of research faculty 10 Policy recommendations

12 Supporting the translation of knowledge
12 The economic impact of university spin-out companies 13 Technology transfer offices—under-resourced but critical partners 14 The innovation gap 15 Existing federal programs of potential benefit 16 Policy recommendations

19 Seeding innovation ecosystems
19 The case for innovation ecosystems 21 IMPACT 22 Policy recommendations

24 Measuring for success
25 Technology transfer metrics 25 Looking beyond traditional technology transfer metrics 27 Measuring sustainability through talent and linkages 28 Creating the measurement infrastructure 30 Policy recommendations

Contents

32 Preparing for shifts in competitiveness
34 Policy issues to consider

36 Conclusion 37 About the author and acknowledgements 39 References 42 Endnotes

Introduction and summary
The United States is known for its innovativeness and entrepreneurial spirit. Between half and three-quarters, or even more, of all economic growth in the last half-century can be tied to technological innovation, depending on which study you use.1 Yet in the last few decades, measures increasingly demonstrate that the United States is falling perilously behind in innovation. When we think of technological innovation, we think of inventors, entrepreneurs, and corporations joining novel ideas with financial capital and market opportunities. Efforts to increase innovation should help support circumstances for the private sector to bring new products and services to market. The spark of technological innovation, however, often begins well before the opportunity is obvious or attractive to private sector. As a result, the partnership between the U.S. government’s funding of research in the nation’s public and private universities plays a larger role than most observers recognize. Universities play a vital and extensive role in driving innovation in the United States. They offer a vast research base (a total of $50 billion nationwide), the ability to teach and develop a fresh new workforce (3 million graduates each year), goodwill of successful alumni, the ability to convene disparate expertise, and a deep commitment to local communities. Universities have been important players to date, and we have an opportunity to further nurture these vibrant ecologies to sustainably generate greater innovation and economic growth. In the context of the declining state of innovation in the United States, we have an opportunity to tap into universities in a variety of ways, among them: • Stoking the engine of innovation—supporting university research, the foundation for the most groundbreaking innovations and innovators that can create new industries

1

Center for American Progress | Universities and Innovation networks

• Supporting the flow and application of knowledge—bringing industry expertise to academia and reducing scientific risk to enable early discoveries to advance to the stage where the private sector is willing to invest and capitalize on them • Seeding innovation ecosystems—creating the culture, human capital, and connections necessary to form innovation networks where researchers, entrepreneurs, investors, manufacturers, and other research interests can collaborate and compete • Measuring for success—developing the right framework and infrastructure for measuring innovation to guide policymaking and investments • Preparing for shifts in competitiveness—rethinking assumptions and trying new approaches so that policy can drive new frontiers of innovation Increasing globalization, connectivity, access, and acceleration of technology only make the need to invest in innovation all the more urgent. And ultimately, we must realize that the landscape is shifting, and what works yesterday may not be as effective today, nor be the best approach in the future. The United States and its universities should not only accelerate its investments in research and innovation but also continually reevaluate and redesign the traditional mechanisms for doing so to prepare for the changing face of innovation long term. In the pages that follow, we examine all five of these ways to stoke innovation through and around universities, relying on public- and private-sector support and collaboration. We include specific policy recommendations at the end of each chapter of this report, but here is a brief synopsis of our main recommendations: • Increase investments in early-stage research, targeting part of these investments toward high-risk, large-scale, transformational projects, with an emphasis on the development of talent • Bridge the gap between early-stage research and the marketplace through policies that support technology transfer, programs that increase knowledge flow between academia and industry, and partnerships that support translational research and proof-of-concept projects

2

Center for American Progress | Universities and Innovation networks

• Refocus federal economic development funding on regional and local ecosystems that develop talent and create links between researchers and the private sector • Develop new, more comprehensive methodologies to measure the linkages between investments in innovation and the broader impacts in human capital, new products, and jobs to drive better policy decisions and incentives for innovation • Develop radical policy experiments and incentives to enable universities to be at the forefront of trends in innovation and competitiveness as the future mechanisms of innovation change This paper will demonstrate that these recommendations are definitively appropriate for our nation to pursue in order to boost the global strength and competitiveness of our science and our economy.

3

Center for American Progress | Universities and Innovation networks

Current state of U.S. investment in innovation
Despite America’s long-held reputation of innovativeness, it ranked only sixth in a recent study of innovation capacity. More alarmingly, the United States ranked last of 40 countries in terms of improving this capacity over the last decade.2 We have fallen behind, and our rapid slide is only accelerating. After a long history of the United States at the top, how could this be? In 2005, the National Academies “Gathering Storm” committee concluded that the primary driver of the future economy will result from advances in science and engineering. Yet federal government funding of R&D has declined by 60 percent as a percentage of gross domestic product (the largest measure of our economy) over the last 40 years.3 Meanwhile, other countries such as China and South Korea have approximately doubled their investments in the last two decades.4 To put this in perspective, the total annual federal investment in research in mathematics, science, and engineering is equal to the increase in U.S. health care costs every nine weeks.5 Our human capital investment lags as well. The United States ranks 27th among developed nations as measured by the percentage of undergraduates completing science and engineering degrees.6 And according to a National Science Foundation study on earned doctorates, nationally more than two-thirds of engineering Ph.Ds are now granted to foreign nationals.7 Although this report focuses on financial capital investments in the innovation ecosystem, investing in university research is tightly intertwined with developing the talent that drives our country’s research and development. Jobs continue their exodus overseas, gutting America’s economic vibrancy and innovative capabilities. Over the past decade in the United States, 42,000 factories closed and 6 million manufacturing jobs were lost.8 These are no longer purely low-wage jobs, either; firms such as General Electric Co. now locate the majority of research and development jobs outside the United States.9 Similarly, innovative efforts are no longer limited to companies based in our country; in 2009, the majority of U.S. patents were filed by non-U.S. companies.10

4

Center for American Progress | Universities and Innovation networks

The imbalance of investment in innovation began decades ago, but is becoming evident in our economy now. Take China, for example. Compared with its trade surplus of $196 billion in 2009, the United States had a trade deficit of $379 billion.11 According to a Georgia Tech study, China has now supplanted the United States’s leadership role in “technological standing” and is the leading exporter of high technology worldwide.12 Five thousand of Wal-Mart’s 6,000 suppliers are in China.13 If we do not reverse course, these trends will only accelerate as the past several decades of shrinking investments in innovation manifest themselves. We have an urgent crisis that can be addressed only if we renew our innovative capacity and invest in the long term.

5

Center for American Progress | Universities and Innovation networks

Stoking the engine of innovation
The majority of all economic growth in the last half-century in the United States can be tied to technological innovation, and other countries have been accelerating their commitment to research and development. Meanwhile, the U.S. investments in science and innovation have been slipping rapidly. There are four key reasons why this is happening: • Shifting investments and the role of universities in research • Changing views about the nature and impact of research • The importance of transformative research • Supporting the next generation of research faculty Let’s consider each in turn.

Shifting investments and the role of universities in research
With shrinking federal investment in research, continual expansion of manufacturing capabilities overseas, and domestic education in the so-called STEM disciplines of science, technology, engineering, and mathematics rapidly falling behind other countries, there is less and less to entice corporations to focus their research and development efforts in the United States. The R&D investments of U.S. companies increased 2.6 times more overseas than domestically from 1997 to 2007.14 The situation is only likely to worsen, as a third of the U.S. research workforce is reaching retirement age in the next five years, and half in the next decade. Meanwhile, in addition to shifting investments abroad, corporations are scaling back overall research and development efforts, increasing the significance of government funding. One study found that the 100 winning innovations—those highlighted annually by the R&D Magazine—the R&D 100—are no longer being developed by private industry to the extent they were almost 40 years ago.15 The majority of these award-winning innovations now arise from early discoveries supported through federal funding.

6

Center for American Progress | Universities and Innovation networks

Corporations shy away from long-range R&D investments for many reasons, including the lack of short-term financial returns, the uncertainty of outcomes and the risk of “knowledge spillover” to their competition. As a result, corporations tend to choose investing in less risky endeavors.16 In comparison, universities are not troubled by spillover effects, and in fact welcome them, because dissemination of knowledge is part of the academic mission and incentive system. Universities are among the few places (including federal laboratories) that conduct the type of game-changing and disruptive research that is the foundation of many of the most significant U.S. technological advancements today. A National Science Board report found that more than 70 percent of so-called “prior art” references on the front page of U.S. patents—prior art meaning anything predating the patent application date that is similar to or the same as the described invention—pointed to publications by researchers at universities and other public institutions rather than the private sector.17 Entire industries can be traced back to fundamental discoveries at universities. And Silicon Valley, the poster child of economic development, could not have sprung forth without federal investments in research. Yet federal funding of research is precariously low. Current levels of funding have dropped 60 percent as a percentage of GDP in the last 40 years, at a time when the country’s competitiveness is at great risk.18 Now more than ever, the federal government must redouble its investments in research, which serves as the foundation of innovation in this country.

Universities are among the few places (including federal laboratories) that conduct the type of game-changing and disruptive research that is the foundation of many of the most significant U.S. technological advancements today.

Changing views about the nature and impact of research
Game-changing inventions and discoveries can take a long time to mature, with the impacts apparent only decades after their initial discovery. Today, for example, the Internet is a household word and has created a groundbreaking shift in the way we live, work, and play. But 30 years passed between the first Internet message in 1969 and the Internet boom of the late 1990s. Similarly, it required a decade from the first paper describing recombinant DNA to when biosynthetic human insulin was first commercially available in 1982; since then rDNA has become the fundamental principle upon which today’s biotechnology industry is based. Unfortunately, the majority of Americans, policymakers included, are today unfamiliar with the process of research. Most people can understand an endeavor where the outcome is planned, such as manufacturing a cell phone or

7

Center for American Progress | Universities and Innovation networks

producing a film. It is much more difficult to grasp the process of exploring the unknown. But in much the same way that Roald Amundsen set his sights on the South Pole without knowing what he would find there, the process of discovery is not haphazard or random. The process is deliberate, but the actual moment of inspiration can be a surprise. Discoveries are built on other discoveries, and regardless of whether the outcome of a particular project has a direct commercial application, the knowledge gained becomes a piece of the puzzle. Often the unexpected outcomes, such as Christopher Columbus landing in the West Indies, can be the most important game changers. But because the result of each project is unknown at the outset and one cannot predict those that will lead to commercial success, a portfolio approach is required. The plan initiated by the George W. Bush administration and continued by the Obama administration to double research funding at three key research agencies—the National Science Foundation, the Department of Energy’s Office of Science, and the Department of Commerce’s National Institute of Standards and Technology—in the next decade demonstrates a positive commitment to bolstering American research and development. Yet Congress and the American public must continue to see the importance of these investments, especially in difficult economic times. In particular, additional increases in extramural federal research funding is essential to enable many of our nation’s new ideas and to foster the next generation of innovators.

The importance of transformative research
In large part, this lag time between discoveries and products can put research funding at risk. Faculty are spending increasingly more time on applying for grants, rather than doing research. The payline—the percentage of proposals that are funded—for the National Institutes of Health is at its lowest level ever. This phenomenon, along with the conservative nature of peer review, can limit risktaking by faculty, who hesitate to submit a proposal unless they are fairly certain the results will support the hypothesis.19 Research, however, should be risky and long-term—these transformative endeavors are generally the ones that result in the biggest breakthroughs. Transformative research is defined by the American Association for the

8

Center for American Progress | Universities and Innovation networks

Advancement of Science as “research with the potential to generate deep changes in concepts, to produce new tools or instrumentation that will allow the entire community to extend its reach, to create a new subfield, or to bring together different fields to make discoveries that would otherwise be impossible.”20 When the research process is not well understood by policymakers, early stage research grants can become smaller, and expectations become based on shorterterm commercialization outcomes. Multiple agencies support small research projects applied to narrow applications, while fundamental scientific questions are left unaddressed. The opposite trend is needed. The federal government plays a crucial role in supporting high-risk, high-reward research that is no longer supported by industry, and we should not be afraid to make big bets on big ideas—even though the results may not be apparent for a long time. In the past and present, a mixture of public and private institutions such as the Department of Defense’s Defense Advanced Research Projects Agency alongside private-sector Bell Labs, Xerox’s Palo Alto Research Center, and the Howard Hughes Medical Institute have created highimpact innovations because of their focus on high-risk,high-reward research. ARPA, which eventually transformed into DARPA, beginning in the 1960s would award grants of $10 million or more in today’s dollars into large collaborative research programs to support investigators with bold ideas and led to decades of economic growth. Many of the early university innovations from ARPA continued into the private sector through industry laboratories such as PARC and Bell Labs, and spurred entire industries. Most of the seminal algorithms for computer graphics, for example, were developed at the University of Utah in the late 1960s, with the leading minds going on to found companies such as Adobe, Pixar, Silicon Graphics, Atari, Netscape, and others. Although focused more on applied research now, DARPA continues a catalytic level of investment today closely linked to the mission of defense agencies and needs of the warfighter. The Department of Energy’s new Advanced Research Projects Agency-Energy is doing similar work today. Authorized at $300 million in FY 2008, ARPA-E replicated this model of focusing talent and teamwork on high-risk, high-reward projects. Early indicators show success, and it’s essential for Congress to understand the high-value impact programs like this can have, especially in years with less overall funding.21

When the research process is not well understood by policymakers, early stage research grants can become smaller, and expectations become based on shorter-term commercialization outcomes.

9

Center for American Progress | Universities and Innovation networks

Supporting the next generation of research faculty
One of the additional values of federal investment in university research goes beyond the creation of new knowledge or impact through discovery to the creation of a whole new generation of researchers and innovators. U.S. universities invest great resources into developing Ph.D.s, and federal funding plays a crucial role. Case in point: 75 percent of life sciences Ph.D. students are supported by either a research assistantship/traineeship or a fellowship/grant.22 But the United States is not able to capture their full value, for at least two reasons. First, a full two-thirds of Ph.D. students are currently foreign nationals, who face difficulties staying in this country after their dissertation. Despite the challenges around immigration reform, this is an obvious place where facilitating immigration would have immediate benefit. Also, the path from recently minted Ph.D. to productive academic career has never been more difficult. A 2008 study by the American Association for the Advancement of Science determined that young faculty were increasingly spending more of their time applying for grants, encountering more difficulty than their more experienced colleagues, at the expense of spending time working to advance their fields.23 And data from the National Institutes of Health show that the average age of first Research Project Grant (called an R01 grant) for Ph.D.s has risen from 34.3 years in 1970 to 41.7 in 2004.24 By creating such large hurdles for early career faculty, we are limiting the effectiveness of the newest generation of innovators we invested so heavily to foster. Extramural research funding invested into universities supports students and their training, a critical piece for developing long-term competitiveness. Many of the bright minds of the next generation are precisely the types of researchers in whom the government should be investing, given the rapidly changing nature of some scientific fields.

Policy recommendations
Despite the tight financial times, the federal government should increase investments in basic research because it is through developing the talent and ideas in innovation and technology that we can create a sustainable base for our economy.

10

Center for American Progress | Universities and Innovation networks

• Carry out the plan supported by the Obama administration and the research and business communities to double research funding at the National Science Foundation, the Department of Energy’s Office of Science, and the Department of Commerce’s National Institute of Standards and Technology, and expand the effort to continue increasing investments from the National Institutes of Health and other agencies investing in basic research. • Reserve part of the federal research budget and target it for high-risk, gamechanging scientific projects. The National Academies report, “Rising Above the Gathering Storm,” concludes that 9 percent of research should go to very longterm funding.25 Develop metrics to measure success across the projects with a portfolio approach. • Invest in and empower program officers to engage with the relevant professional communities and make bold decisions to support transformative research that might be seen at first by a peer review committee as too risky or unconventional. Encourage university faculty to serve as rotating program officers with appropriate recognition from the university administration. • Fully fund the model continued by ARPA-E and adapt it in other scientific areas to develop new technology platforms. Large collaborative research programs modeled after ARPA, the precursor to DARPA and ARPA-E, are particularly needed now. • Consolidate science initiatives across agencies and engage multiple academic disciplines, funding large innovation hubs that address fundamental science questions that can be applied across multiple industries instead of focusing on incremental applied problems. • Extend research and innovation policy to reach beyond science and technology, tapping into the unique capabilities of economic regions of our country to maximize the benefits of the geographic cluster, in areas as diverse as media, education, the creative arts, aquaculture, logistics, and manufacturing. • As described in the 2008 “ARISE” report by the AAAS, provide particular support for early career researchers, such as seed grants for unproven ideas, expanded longterm early career awards, career-stage appropriate expectations when reviewing grants, and policies responsive to the needs of primary caregivers.26

11

Center for American Progress | Universities and Innovation networks

Supporting the translation of knowledge
Early-stage discoveries yield the greatest impact on the economy when they transition out of the laboratory and into the private commercial sector. Yet even the most promising breakthroughs face very real hurdles as they struggle to translate into the market where they can make social and economic impact.27 Many promising discoveries falter before they even have an opportunity to be considered by the private sector, which generally lacks the long investment horizons and risk appetite to invest in ideas at the point most federal funding stops supporting them. The cultural gap between academia and industry further hinder the commercialization process. As such, federal policies can play an important partnership role to bridge the gap between research and the marketplace. This section of the report looks at four key considerations in creating incentives for commercialization: • The economic impact of university spin-out companies • Technology transfer offices—under-resourced but critical partners • The innovation gap • Existing federal programs of potential benefit Let’s turn first to the economic impact of university startups.

The economic impact of university spin-out companies
In 1980, the Bayh-Dole Act enabled universities to own and manage the intellectual property arising from federally sponsored research. From an economic development standard, the Bayh-Dole Act was a boon to local economies and to society at large as new technologies were introduced to market. Shortly after 1980, products and spin-outs—start-ups based on university IP—steeply rose as universities and faculty had incentive to commercialize their inventions.

12

Center for American Progress | Universities and Innovation networks

In 2009 alone, at least 596 start-ups based on university licenses were created across the country, and 658 new products were introduced to market.28 In the three years between 2008 and 2010, companies based on USC research alone have raised nearly $400 million in capital.29 University technology transfer has a strong local economic development impact.30 According to the Association of University Technology Managers, or AUTM, annual survey, between 70 percent and 80 percent of all university start-ups are headquartered in the same state as the university from which they spun out. Between 1980 and 1999, university start-ups in the United States created $33.5 billion in economic value, at an average of $10 million per start-up. By 2007, 3,388 university start-ups were still operational.31 Moreover, the transition to the marketplace does not just occur through the creation of new companies. Early university innovations might emerge through a spectrum of knowledge-transfer routes, such as faculty consulting, students graduating and taking jobs in industry, inventions licensed to established companies, and university start-up efforts to turn ideas into new high-growth companies. Universities by their very nature depend on an open and collaborative exchange of ideas. The vast majority of knowledge in universities is transferred into the private sector through open channels.32 Some of these knowledge transfer routes could be enhanced, particularly through more deliberate attempts by universities and industry to work together. Although many universities have focused considerable amounts of their own resources on technology transfer efforts, this crucial stage of the innovation process has been greatly underfunded to date.

Although many universities have focused considerable amounts of their own resources on technology transfer efforts, this crucial stage of the innovation process has been greatly underfunded to date.

Technology transfer offices—under-resourced but critical partners
The United States enacted the Bayh-Dole Act to encourage universities to commercialize their research and to encourage this type of impact, but it did not provide resources to make this happen. Universities nevertheless have set up technology transfer offices to manage intellectual property and facilitate the transfer of technology. These offices, however, on average tend to lose money, in part because a successful invention can take 10 years or more to generate royalties.33 So, although university technology transfer offices provide benefits to their local communities, they have

13

Center for American Progress | Universities and Innovation networks

limited ability to reinvest resources to enhance interactions with industry in a strategic and proactive manner. Technically, universities may charge the cost of patenting to their administrative cost pools for what university budget offices call facilities and administrative cost reimbursement, or F&A. But the administrative components of F&A are capped by the federal government at 26 percent, which means these costs effectively don’t get reimbursed. The lack of resources for technology transfer is even more acute with the growing expectations for commercialization and economic development based on university research. This critical knowledge transfer function has become an unfunded mandate in the majority of universities, limiting the ability to aid in the successful translation of research into products, companies, and jobs.

The innovation gap
The university new venture process is deeply influenced by early stage capital.34 Some unfamiliar with the commercialization process may look to private industry to address this opportunity through investment in early-stage innovations, but as analysts Christine Gulbranson and David B. Audretsch point out, “University research does not passively spill over for commercialization and innovation.”35 Early-stage venture markets are “inefficient”—meaning they do a poor job of identifying the best opportunities and investing in them.36 So, even some of the most promising innovations struggle to have a chance in the free market. Further, most university seed-stage innovations today are too risky for even the most intrepid venture investors, which means those trying to commercialize university innovations face a large feasibility and funding gap. It is difficult to identify significant innovations that were passed over by the private sector since, by definition, the potential of these inventions has not been realized. But data from the Association of University Technology Managers indicates that opportunities are overlooked; the number of patents filed to every startup formed is 20-to-1.37 Venture capital used to be the risk capital for the building of seed-stage highgrowth companies, but the percentage dedicated to seed financing remains only

14

Center for American Progress | Universities and Innovation networks

about 5 percent of the total venture capital invested, according to the 2011 Q2 PricewaterhouseCoopers MoneyTree report.38 This is the result of a market failure that needs to be addressed at the intersection of research and the private sector. A recent growing focus on commercialization at the federal level is encouraging, but there is a risk that efforts could lead to a shifting of priorities away from fundamental research funding. Proof-of-concept funding should be expanded, but kept separate, applied to only those projects that have led to innovations that cross a threshold of promise in the commercial sector.

Existing federal programs of potential benefit
Unfortunately, very little of the tens of billions of federal dollars currently invested in early-stage university research can be used to explore the commercialization potential of the resulting innovations and help bridge development gaps. Of the related programs currently sponsored by the federal government, many do not achieve their full potential in addressing these gaps. Linking these programs, which span several agencies, through a “Common Application” grant program proposed by our colleagues Jonathan Sallet and Sean Pool in their report in this series will streamline federal spending and address current weaknesses. The Small Business Innovation Research and Small Business Technology Transfer program administered by the U.S. Small Business Administration, which allocates 2.5 percent of federal agency grants for small businesses, has been a resource for some small companies seeking to bring early-stage innovations to market. Yet many university innovations are too early to spin out into a company, so this program does not fully address the need for earlier-stage proof-of-concept funding. Likewise, the National Science Foundation has been experimenting with industry partnerships through its Partnerships for Innovation program and Engineering Research Centers. And the National Science Foundation is in the process of expanding the Partnership for Innovation program in response to the America COMPETES Act reauthorization at the end of last year. But the scope of these programs to date remains narrowly focused, leaving an opportunity to tap into the broader research enterprises at each university. Case in point: Federal attempts to fund proof-of-concept research such as the NSF Accelerating Innovation Research program can be a powerful force in

15

Center for American Progress | Universities and Innovation networks

transforming federally funded research into new products, companies, jobs, and sustainable innovation ecosystems if they focus on building skills and community. Programs at universities that bring together mentors, investors, and entrepreneurs at universities have paid dividends in terms of culture change and increased commercialization. But currently the NSF program is small, with grants being awarded centrally. Coupling these NSF efforts together could provide a robust opportunity to broaden the impact of these efforts to strengthen industry/ research partnerships and develop local innovation ecosystems. The Economic Development Administration has pioneered partnerships with other agencies through its i6 program (an interagency program that provides $1 million in funding over two years to a local ecosystem to catalyze technology commercialization, new venture creation, and jobs) as well as its Energy Regional Innovation Cluster initiative, which stand to positively influence the formation of regional clusters and cluster strategy development. These kind of flexible, collaborative partnerships need to become the new model for success. More recently, the National Institutes of Health introduced various new programs, such as the so-called BRDG-SPAN program, a pilot program aimed to fund the transition from early discovery closer toward commercialization, and the soon-to-come National Center for Advancing Translational Sciences, a translational science center. This follows on the heels of the revamped Clinical and Translational Sciences Award, NIH’s multimillion- dollar grant program to fund institutes that transition discoveries from bench to bedside. While many of these programs target different parts of innovation ecosystems and different stages of the innovation lifecycle, there is no unifying strategic framework uniting their implementation. As discussed in the first report in this series on science and economic competitiveness, “Rewiring the Federal Government for Competitiveness,” creating an overarching Common Application that streamlines the many similar and closely related grants and assistance programs could help reduce redundancy while increasing the ability of these programs to be more strategically and effectively implemented.

Programs at universities that bring together mentors, investors, and entrepreneurs at universities have paid dividends in terms of culture change and increased commercialization.

Policy recommendations
The federal government can break down barriers between federally funded, earlystage research and private-sector investments in innovation in order to create

16

Center for American Progress | Universities and Innovation networks

new products, companies, and jobs. The federal government can help support knowledge and technology transfer with the following actions: • Maintain the current legal framework of the Bayh-Dole Act of 1980 so that universities will continue to invest in technology transfer efforts. • Invest in more translational research funding. This increase should not be at the expense of fundamental research; we must invest on all fronts and also better coordinate funding across agencies and programs. University-based translational programs such as the Clinical and Translational Sciences Award are critical for moving from bench to bedside and should be continued. • Structure translational programs for maximum impact. These programs should require that industry experts, investors, and entrepreneurs be involved in the solicitation, development, and selection of proposals to enhance the traditional peer review process. Translational projects should have a clear project plan that leads toward commercialization, with active management to milestones alongside mentoring and guidance by relevant experts along the way. The Coulter Foundation has developed one very effective model that can be emulated.39 • Coordinate health- and biotechnology-related translational and Small Business Innovation Research and Small Business Technology Transfer programs within the National Institutes of Health through a single program such as NCATS, managed by a group that understands commercialization and translational research, and coordinate other commercialization and proof-ofconcept programs through a Common Application Innovation and Economic Development Grant Program, as described in “Rewiring the Federal Government for Competitiveness.” • Implement a mechanism for “Translational Supplemental Awards” when warranted, determined only after research yields results. The National Science Foundation’s I-Corps Program, which provides proof of concept funding and mentoring to select faculty at universities across the country, is promising and should be scaled and expanded to support projects across all agencies, and provide larger awards (up to $150,000) when warranted. Further, consider a program for postdoctoral fellows to learn about commercialization and continue proof-of-concept work on their dissertations if they show commercial promise.

17

Center for American Progress | Universities and Innovation networks

• Design translational funding programs such that technology transfer offices are deeply engaged rather than marginalized. Provide funding to support these offices with dedicated resources to support the translational program to set them up for success. • Structure proof-of-concept programs in a sustainable way. Although some universities have managed to secure donor and private-sector funding to cover some of the costs, even the most successful programs struggle to become sustainable on these sources alone. Instead of structuring proof-of-concept funding as short-term pilots, leverage other funding sources, such as industry and donor support in parallel, to extend the impact of the federal funding. Given the importance of transitioning between early-stage and spin-out to the economy, funding proof-of-concept projects is an appropriate role for the federal government to play. • Reward universities committed to advancing innovation and building their technology transfer offices so that they work well. To ensure that a translational program will be successful, use the effectiveness of the technology transfer office and the university’s commitment to innovation as criteria. This will have the added benefit to motivate universities to continually improve their technology transfer operations. • Review and structure conflict-of-interest policies at the National Institutes of Health and other agencies to maintain academic integrity without putting undue restrictions on commercialization activity or additional administrative burden that could otherwise be invested in technology transfer activities. Put into place mechanisms for disclosing and managing conflicts of interest, with guidance for faculty before they come up against these issues.

18

Center for American Progress | Universities and Innovation networks

Seeding innovation ecosystems
While an acute need exists for proof-of-concept funding for ideas that emerge from research, the innovation gap goes beyond the financing gap. Linkages between the university and the private sector are critical to bring relevance to research. And as an idea develops and moves into the private sector, it ideally will stay local and thrive. There is a need to strengthen the relationships between universities, industry, government, and nongovernmental organizations to nurture sustainable local and regional innovation ecosystems that can support the growth and success of new ventures. Elements of such an entrepreneurial ecosystem include: • Talent, including experienced entrepreneurs willing to share their knowledge and jump in as early-stage chief executives • Early-stage capital • Access to early adopters, customers, and suppliers • Creation and collaboration space near intellectual hubs Universities are the critical piece of the puzzle beyond the development of knowledge and the commercialization of research. They develop our nation’s workforce, create connections between people, and cultivate inspired entrepreneurs that feed back into the system. As a result, universities can play a central convening role for local and regional innovation ecosystems that can serve as a platform for growing a sustainable and robust economy.

The case for innovation ecosystems
Studies show that universities benefit from programs that enable university innovators, entrepreneurs, and investors to connect with one another.40 Increasingly, universities are seeking out ways to finance these types of programs in the absence of federal support.

19

Center for American Progress | Universities and Innovation networks

Efforts have been highly variable and dependent on funding. Some universities are fortunate to receive assistance through major gifts or local funding, and boast innovation centers with grant programs that have demonstrated great leverage and great success. Christine Gulbranson and David B. Audretsch wrote about two programs centered in engineering schools, the MIT Deshpande Center for Technological Innovation and the University of California, San Diego’s von Liebig Center.41 After granting less than $10 million to projects, these two centers helped advance 26 start-ups that have raised a total of $160 million in outside investments. In parallel over the last five years, the Coulter Foundation has funded programs specifically in biomedical engineering departments across the country, including at Stanford University, Georgia Tech, Drexel University, and the University of Virginia, creating best practices along the way. A different example is the USC Stevens Institute for Innovation at the University of Southern California, launched in 2007 with a $22 million gift. That funding has been used so far to significantly re-engineer business development and licensing operations, extend beyond traditional technology transfer to support innovators across all schools and disciplines, develop programs to fund and mentor faculty and student teams, and promote a universitywide culture of innovation. The key to these programs is that they don’t focus exclusively on accelerating individual projects but rather on developing lifelong innovation skills and a community of investors, entrepreneurs, and other stakeholders. They can shift the entire culture at the university to celebrate innovation and entrepreneurship. For example, USC’s Ideas Empowered program, launched in 2010, engaged 89 researchers in the latest round of competition for commercial support, despite the fact that receiving a small grant (generally between $50,000 and $100,000) requires months of preparation and mentoring. This demonstrates the appetite for many faculty and students to get involved in commercialization if they believe they will receive the coaching and connections with the local community they need to be successful. The federal government should consider competitive block grant models that deploy funding locally and strengthen innovation ecosystems, in addition to funding numerous smaller grants centrally. “Rewiring the Federal Government for Competitiveness,” also in this series on science and economic competitiveness explores this idea in more detail. Programs should be consolidated in a way that makes them cost-efficient and effective, and the impacts measured broadly.

The federal government should consider block grant models that deploy funding locally and strengthen innovation ecosystems, in addition to funding numerous smaller grants centrally.

20

Center for American Progress | Universities and Innovation networks

IMPACT
In 2009, a policy paper called “Innovation Model Program for Accelerating the Commercialization of Technology,” or IMPACT, proposed a $20 million pilot, to fund 10 innovation ecosystems that would tap into the intellectual capital and convening power of universities and provide proof-of-concept grants and mentoring to research projects.42 The funding from each demonstration grant would complement existing activities already in place at the university in order to provide, at a minimum: • Proof-of-concept funding with appropriate project management • Community engagement, networking, and team-building • Business strategy and mentoring (universities may engage additional students and curriculum to support this) • Educational resources • Media relations and showcasing of projects • Measurement and evaluation of results This program could provide 10-to-1 or even 20-to-1 leverage on the federal government’s investment. It is modeled after successful proof-of-concept programs of USC, MIT, UCSD, Georgia Institute of Technology, and the Coulter Foundation, as described above, which have demonstrated the ability to attract outside private-sector investment many times greater than the federal funding invested. Various agencies have attempted to put forth this type of approach recently. The National Science Foundation’s Accelerating Innovation Research, or AIR, program and two i6 programs coordinated by the Department of Commerce are two cases in point, but neither is quite in the form or scale suggested by the IMPACT proposal. The key is for this funding to be managed from a local level to engage stakeholders and provide additional value beyond just the individual grant funding. The programs would be universitywide so that they would contribute to a culture change across all disciplines and tap into the broadest base of research funding. The need is now acute. At this point we must fund this concept beyond a pilot level; $80 million per year would support at least 40 university ecosystems

21

Center for American Progress | Universities and Innovation networks

across the country. If past experience can be a guide, this level of funding could potentially stimulate $1 billion in private-sector investment in ideas that would otherwise be too early and risky for investors to currently bet on.

Policy recommendations
Innovative capacity in regions can be strongly developed with universities at their core with the following policies: • Provide funding for universities to enhance their innovation ecosystems, including proof-of-concept funding and mentoring. The 2009 IMPACT policy proposal discusses in detail how the federal government can support this effort, but two years later must be expanded to support dozens of universities for maximum impact. The proposed Department of Competitiveness Common App, detailed in “Rewiring the Federal Government for Competitiveness,” would allow for more specific IMPACT allocation from these funding pools. One possible source of funding is described in the leveraging private-sector R&D section below. • Distribute proof-of-concept funding locally, not centrally, to centers within universities or collaborative regional enterprises engaging multiple universities and other stakeholders into the local ecosystem. Regional innovation should not be orchestrated from Washington, D.C. Instead, competitive “block grants” enable regions to budget and deploy in programs with locally developed outcome measures, since regional players understand best their own opportunities and gaps. • Expand the National Science Foundation’s Partnerships for Innovation program as described in the America COMPETES Act reauthorization, with fewer, larger grants to support partnerships between larger and smaller universities, which will create a critical mass and sharing of best practices necessary to bolster the program. • Refocus economic development funding on innovation-based economies, which have high growth potential, and focus on people rather than infrastructure. The most effective investment of these dollars is on the development of talent and the networks among innovators, investors, and entrepreneurs.

22

Center for American Progress | Universities and Innovation networks

• Enhance the Small Business Innovation Research and Small Business Technology Transfer program in three ways consistent with current statutory authority: remove the SBIR requirement to have the primary researcher employed by the company receiving the grant; set aside a portion of STTR funding for proof-of-concept centers before SBIR phase 1 grants are awarded; and partner with local innovation ecosystems around universities to help select grantees and provide mentoring and networking to enhance the effectiveness of the grants. • Work with governors to try to address state policies that might stifle new ventures from universities; for example, some states forbid public institutions from taking an equity stake in spin-out companies or limit the entrepreneurial involvement of faculty who are state employees. • Consider the impacts of developing human capital as much as the intellectual property when measuring the outcomes of university research.

23

Center for American Progress | Universities and Innovation networks

Measuring for success
Traditional technology transfer measures such as patents filed and licensing revenues are inadequate to convey the important consequence of transformative research to our nation’s scientific and economic development and competitiveness. Innovation can have many outcomes, such as: • New knowledge that can be built upon • New linkages between collaborators • New skills in the workforce • The ability for a region to retain talent and provide jobs to match their needs • New companies, services, and products in the service of the public good • Economic growth and employment All of these outcomes boast intrinsic value, and they frequently build on each other, but we often only measure that last category—economic growth and development—without demonstrating the connections with the rest of the outcomes. There is a belief that science leads to greater innovation, which leads to economic impact, yet it has been difficult to make the link explicitly. Meanwhile, universities’ impact is much broader than simply the transfer of technologies,43 and academia often hesitates to report on outputs because of fears the data will underestimate the actual impacts, making it even more difficult to gain the necessary insights for policymaking. Metrics can focus efforts and drive results, but our ability to measure innovation in the United States is still very basic. It becomes very difficult to evaluate which policies succeed and course-correct without an adequate way to measure outcomes. We need to develop a much more sophisticated understanding of how innovation grows, as well as the broad social and economic benefits of innovation to regions and society as a whole. To better lead to a sustainable innovation, we must measure

24

Center for American Progress | Universities and Innovation networks

our investments in innovation accurately and incorporate tracking into any newly proposed, integrated programs. This section of the paper explores several ways to comprehensively measure the impact of universities, and complements the broader proposals put forth by George Washington University visiting professor Andrew Reamer in his paper in this series titled “Economic Intelligence.”

Technology transfer metrics
The Association of University Technology Managers, or AUTM, tracks the activities of university licensing offices. Among the measures most frequently cited are licensing revenues, number of licenses executed, patents filed and granted, and number of start-ups based on university intellectual property. These can be crude measures because the value of one patent, or one license, does not equal another. Additional outcomes-based technology transfer metrics could serve as an important indicator of economic activity, but they are rarely measured. Seed financing and total capital raised by university spin-out companies, for example, reflect the economic impact of companies formed and provide outside validation of the prospects of growth. Jobs created, number of products reaching market, and product sales would also be valuable indicators of commercialization.

Looking beyond traditional technology transfer metrics
Technology transfer metrics are useful, but are limited in their perspective. They do not emphasize the important educational and service role that a technology transfer office and other university innovation programs can play. The ongoing success of innovation efforts at the university level should be judged based on their ability to enhance all four of the following key areas: • Broadening the impact of the most promising university innovations through pathways such as commercialization, start-up formation, and industry collaborations • Celebrating innovation and entrepreneurship, and increasing the enthusiasm and engagement of faculty and students across all disciplines in such activities • Developing lifelong innovation and entrepreneurial skills

25

Center for American Progress | Universities and Innovation networks

• Developing a local community that supports the advancement of new ventures and innovation. These are not easy things to measure, to be sure, but that should not stop us from trying. Further, the university technology transfer office, while very important, is not the only knowledge channel at a university. Focusing all measurements there will not reflect the broader consequences of research. One study, for example, finds that ideas emerging from the Massachusetts Institute of Technology’s engineering school found their way into products through intellectual property licensing only 7 percent of the time; other channels included papers, conferences, collaborative research, consulting, and students graduating and taking positions in industry.44 Fortunately, Section 521 of the America COMPETES Act reauthorization passed last year by Congress requires that the National Science Foundation contract with the National Academy of Sciences to initiate a study to evaluate, develop, or improve metrics for measuring the potential impact of research on society. This mandate gives the National Academy the flexibility to study more broadly the impacts of research and the individuals graduating from institutions of higher learning. This effort will enable us to capture the broader impacts on social well-being and talent development as well as the financial success of firms. Efforts to measure the impact of university research that could benefit from better metrics include: • Industrial references and reliance on academic publications • Informal contacts between university faculty and industrial firms • Hiring of university graduates • Firm starts based on recent graduates • Specific university-industry training collaborations • Conferences • Jointly funded research activities between universities and industry • Contract research performed by the university for industry • Temporary exchanges • Industry usage of university scientific facilities • New industrial processes, techniques, and instrumentation that can be traced to university research • Case studies that can show clear linkages among industrial products, firms, and university research

26

Center for American Progress | Universities and Innovation networks

All of these indicators are measurable—and together would give us a much fuller view of the consequences of investing in scientific research and development. Ultimately, though, commercialization is performed not by universities but by firms in the private sector, which makes it difficult to put an economic value on outputs and directly link them to economic and other outcomes. We need a systematic approach to measure the impact of research or programs that support business innovation, such as technology transfer offices and incubators. One promising approach has been developed by the Evidence Network, a Canadian firm that works with innovation intermediaries to assess their impacts along dimensions such as information flow, linkages, and services—using a surveybased approach to ask private-sector clients to rate how these innovation-related impacts supported outcomes such as revenues, employment, and investment. So far its methodology has been used by a variety of clients, such as research and development institutes, technology commercialization programs, and economic development organizations.45 It has provided a means to quantify and monetize the impact of these organizations that otherwise would find it very difficult to assess their value, and to rigorously demonstrate the connection between their impact on company innovation and their impact on market performance. Although patenting and licensing provide an important avenue for the advancement of some innovations, the impacts of university research will be vastly underestimated if only measured through traditional technology transfer metrics. We need a much more sophisticated understanding of the diffuse social and economic benefits of innovation clusters to regions, which these measures suggested above would accomplish.

Although patenting and licensing provide an important avenue for the advancement of some innovations, the impacts of university research will be vastly underestimated if only measured through traditional technology transfer metrics.

Measuring sustainability through talent and linkages
Investments in scientific research do not guarantee short-term economic growth, but are essential to long-term competitiveness. How, then, can the federal government measure success in the short term? One way is by measuring knowledge and skill development and the growing linkages between people and institutions, which would enable us to understand both the sustainability of an innovation ecosystem and its ability to address more and more complex global challenges.

27

Center for American Progress | Universities and Innovation networks

This will be a complicated endeavor, but fundamentally a project or institution’s ability to catalyze new linkages between researchers and industry adds value to the innovation network or networks in which it resides. Thus a “collaboration index” could look at new connections created as a result of the research investment to measure these linkages. Advancements in social networking in particular could be used to track the advancement of talent and connections between researchers and institutions. The professional social networking site LinkedIn, for example, allows individuals to provide information about their professional careers and connections and connect with one another. A site like this could be used to provide insight into the path of graduates in the workforce and enhanced linkages as a result of research projects. It could also be used to stimulate some of these connections. Ultimately, the true test of innovativeness is our ability to be part of the global intellectual conversation, and it would be valuable to do a study across industries to analyze the influence of the United States and see how it is shifting. Looking at where the top scientists and other experts are born, trained, and employed would be important to understand. Based on policy decisions in the past decade or two, one could speculate that certain areas such as climate science and regenerative medicine might demonstrate a significant waning of influence, while our expertise in computer science may still be strong. Studies should be conducted to validate whether this is indeed the case. Measuring the U.S. influence in a variety of industrial and scientific sectors as well as our human capital’s capacity to innovative could lead to policy recommendations that would help us regain and maintain competitiveness and project policy impacts long before the direct impacts are recognized. We might be able to identify the capacity to innovate long before the direct impacts are recognized.

Creating the measurement infrastructure
Currently, some innovation and economic data exist, but in different information technology systems within separate agencies in the federal government—and with disparate standards and no easy way to share them. Further, much of the data are collected in an ad hoc manner and are often survey-based. This lowers the quality and increases the resources required to supply it.

28

Center for American Progress | Universities and Innovation networks

What we need are microdata on individual research projects, on one standard platform that is accessible to researchers who can analyze the relationship between inputs such as funding, supports such as skills, and outputs such as products and employment. We can learn from the Brazilian database of researchers and institutions called Lattes. Launched in 1999, Lattes is a public network that enables the accurate tracking of knowledge and innovation activities. This virtual community has now been introduced in many countries to include more than 1.7 million registered CVs of researchers at more than 14,000 institutions. All data, except for personal information, are public. This database provides a platform for assessing research activities nationally; users can locate other collaborators and expertise, identify and evaluate competencies, characterize networks and connections, and evaluate outcomes from individual research investments.46 The National Science Foundation and the National Institutes of Health have begun a laudable effort called STAR METRICS that works with universities and other research institutions to collect accurate and consistent microdata about research projects so it can be analyzed. Other efforts have been taken on by individual researchers, such as the database developed by University of California, Davis professors Martin Kenney and Donald Patton on initial public offerings; the data gathered on the production of scientists by economic professors Paula Stephan at Georgia State and Sharon Levin at the University of Missouri-St. Louis; and an upcoming patent database developed by Harvard Business School professor Lee Fleming and his colleague Vetle Torvik at the University of Chicago. These sources could be analyzed alongside U.S. Internal Revenue Service individual and corporate tax data, data from the U.S. Patent and Trademark Office, and other publicly available datasets. Individual privacy could be maintained while providing insight into innovation trends. Despite the need and opportunity, no organization exists to focus on the measurement of innovation. Such an organization would be able to tie into all the disparate sources of data and begin to relate federal research investments to social, scientific, and economic outcomes, and to paint a rich picture of the impacts of various policy decisions and research investments. To best capitalize on this opportunity, an Office of Innovation Analysis should be created. This office could report directly to the Assistant Secretary for Economic Policy in the Department of Treasury’s Office of Economic Policy, paralleling the way the Office of Tax Analysis reports directly into the Office of Tax Policy.

Despite the need and opportunity, no organization exists to focus on the measurement of innovation.

29

Center for American Progress | Universities and Innovation networks

While this suggestion goes beyond the more immediate policy recommendations of my colleague Andrew Reamer in his paper titled “Economic Intelligence,” the goals are the same

Policy recommendations
We can improve our ability to catalyze and accelerate innovation if we focus on appropriate metrics for measuring success. Among the ways to do so are to: • Implement new metrics to measure the consequences of research and individuals graduating from universities, as mandated by the recently passed America COMPETES Act. Define the metrics in a way to ensure they more broadly reflect universities’ effectiveness in growing ecosystems and capacity for sustainable impact, through licensing and start-up creation, teaching commercialization skills, broadening engagement across the research community, developing linkages within the university and with the broader innovation ecosystem outside the university, and successfully sharing and implementing best practices. • Continue the federal STAR METRICS efforts to measure microdata on research investments. • Establish an independent Office of Innovation Analysis within the Office of Economic Policy in the U.S. Treasury to develop an ongoing mechanism for measuring innovation in the United States. • When evaluating the success of licensing efforts, look beyond traditional metrics such as patents and license revenues to more outcomes-based measurements and include education and service as part of the core mission of technology transfer offices. • When measuring knowledge transfer, consider broader mechanisms such as publishing, participation in conferences, collaborative research, consulting, and students graduating and taking positions in industry. • Invest in developing new methodologies for measuring linkages between researchers, industry, and institutions. Leverage new social media tools for tracking network-based influences and consider creating a “collaboration index” to measure the full impact of the flows of knowledge.

30

Center for American Progress | Universities and Innovation networks

• Reward universities that show commitment to entrepreneurship and innovation. Prizes and other short-term incentive initiatives have the capacity to work, but generally more sustained program initiatives such as Partnerships for Innovation and other more recent funding efforts have a much more transformative effect for university culture and impact.

31

Center for American Progress | Universities and Innovation networks

Preparing for shifts in competitiveness
New firms are essential for job creation in the United States.47 Since the beginning of the Great Recession in 2007, however, new companies are launching with fewer resources and creating fewer jobs. This jobless recovery is raising questions of a “new normal,” where fewer workers are needed to perform higher levels of work, and work is increasingly becoming freelance and transitory. For corporations, competition is intensifying on a global scale, customer loyalty is declining, corporate returns on assets have dropped to less than a quarter of what they were a few decades ago, stock prices are much more volatile, and churn in the S&P 500 is accelerating.48 Amid all this change, technology is accelerating at rates never seen before, with implications ranging from education to intellectual property law. Increasingly, ideas flow seamlessly across institutional and international boundaries. Value is increasingly created by the flow of knowledge rather than the ownership of knowledge. The future of economic growth, then, will probably rest less in individual corporations and more in networks of suppliers and customers. Similarly, stocks of knowledge, such as individual patents and trade secrets, will have less and less value as the flow of ideas within these networks gain influence. This underscores the importance of retaining as much of the value chain as possible in the United States. But it is also is a reminder that we must adjust to a new reality of cooperation as much as competition. A separate competitiveness issue is our venture capital industry. Over the past several decades it has stimulated ecosystems, taken risks, and invested in lean and agile startups. But due to their 10-year fund time horizons, they need to show returns in their investments within about five years. This results in much less patience for more groundbreaking scientific investments, thus depending on federal funding even more for pre-commercial innovation.

32

Center for American Progress | Universities and Innovation networks

Then there’s the revolution occurring in manufacturing. In much the same way that new digital tools have democratized media and journalism, a new parallel revolution is enabling people to create and share in the physical world, providing both threat and opportunity. The up-and-coming “maker” culture—highlighted in Cory Doctorow’s sci-fi novel, Makers, and Chris Anderson’s article “In the Next Industrial Revolution, Atoms Are the New Bits” in Wired magazine in 201049—may become the next industrial revolution. This revolution is powered by a new box of tools accessible to anyone: $2,000 worth of computer numerical control machine tools and $1,000 in MakerBot 3D printers, easy-to-program microcontrollers such as the Arduino, and microfactories and global supply chains ready to manufacture and ship small batches of a new product anywhere around the world. These tools are available today and are already being used to launch new products and companies, such as Square, the high-growth start-up company that sells special credit card readers that enable anyone with an iPhone to accept credit card payments. At the same time, a revolution is happening in information. With vast volumes of data becoming more and more accessible, it provides perspectives not available before. Enormous databases of personal data within technology companies such as Google and Facebook enable new insights into human behavior, thought, and language. Meanwhile, corporations ranging from start-up company 23andMe to established pharmaceutical companies are gathering and mining genetic information at an increasing rate. Genetic information from tissue banks combined with longitudinal patient data can enable the rapid discovery of biomarkers that can lead to better and faster cures though enhanced diagnostics, patient stratification, and enhanced outcome measures. Universities’ unique culture of data sharing and open access to data on the one hand, and the richness of available data ... from the scope of research questions to the number and diversity of patients studied ... on the other will further increase the role of universities in the future. Biomedical innovation is becoming just as much about data analysis as it is about biology. These shifts will likely have significant implications on the way science is conducted in the future. As a result of all of these changes, it is worth rethinking our assumptions about policy and looking to experiments that might lead to revolutionary, not evolutionary, change. Some of these questions are addressed in a separate section below.

Universities’ unique culture of data sharing and open access to data on the one hand, and the richness of available data ... from the scope of research questions to the number and diversity of patients studied ... on the other will further increase the role of universities in the future.

33

Center for American Progress | Universities and Innovation networks

Policy issues to consider
Many of these shifts are only now unfolding, and we will not know their full extent right away. As a result, the policy implications are not completely clear. Yet we should already begin to think differently and look to revolutionary change. Just a few examples, which are meant to be illustrative, include the following: • Develop policies that support the democratization of tools, new fabrication facilities, and new ways of manufacturing across all fields from nanotechnology to biotechnology. Explore the role of craft in research—meaning the hands-on skills necessary to build instrumentation and experiments, leading to greater insights and innovation during the process of research—and do a survey on tools and transnational projects to enable that craft. • Improve access to manufacturing and prototyping facilities for university communities. These facilities can also provide access, along with training programs, to residents of any job-starved neighborhoods nearby. • Enable linkages and cooperation among universities on a global basis now that innovation is global. Think of collaboration more than competitiveness— consider win-win solutions rather than a zero-sum-game; new innovations will provide better quality of life and grow the global economy in ways that will provide opportunities to everyone. • Push toward more open data publishing requirements. This could include incentives for researchers working on hypothesis-driven projects who would otherwise wait until after they have analyzed their data and published their conclusions to accelerate publishing raw data. • Enable new platforms across many disciplines, such as personalized medicine, to capitalize on a new, low-cost, networked, and open type of innovation, similar to the innovation that was enabled by the Internet. • Consider new intellectual property policies that maximize innovation within this framework as appropriate, which relies less on protection than on encouraging sharing. Develop ways to better measure and reward flows of information, rather than “stocks” of information (such as patents).

34

Center for American Progress | Universities and Innovation networks

• Change funding and collaboration models as the world becomes increasingly complex. As so-called “wicked problems” such as global climate change, homeland security, and health require collaboration across numerous disciplines and continents, explore how transaction costs between collaborators can be reduced.50 Drive new modes of digital scholarship, where the result of a study can be published in multimedia or other forms that cannot be put on a shelf in the stacks of the library. • Create incentives for longer-horizon venture capital funding models. • Reconsider peer review to increase risk-taking and out-of-the-box ideas from edge thinkers. Create incentives for interdisciplinary projects and remove tenure barriers for boundary-spanners and nontraditional academics. • Consider incentives for alternative models to the traditional tenure clock that would enable early-career risk-taking, such as the 10-year contracts at the Howard Hughes Medical Institute. These recommendations will require more thought and involvement by a wide range of stakeholders, and will likely not be easily influenced by national policy alone. But these issues should be kept in mind as we consider revolutionary, rather than evolutionary, change.

35

Center for American Progress | Universities and Innovation networks

Conclusion
Despite our nation’s reputation for its innovativeness and entrepreneurial spirit, we are falling behind and struggling to compete in the global marketplace. The vast majority of economic growth in America arises from technological innovation, which depends heavily on research universities. We have an urgent need to support university research—both fundamental and applied—and the information networks and innovation ecosystems that undergird and emerge from it. We have an opportunity today to take advantage of a great resource that is the envy of the world, our higher education system. In order to do so, we must invest in basic research that: • Creates new knowledge and new talent • Supports pathways for knowledge and technology translation • Helps catalyze innovation ecosystems that have universities at their core • Attracts and rewards the deployment of industry resources • Develops new ways to measure success In addition, we must keep our eye on the changing landscape of innovation and make sure that our policies and institutions are well-equipped to take advantage of these shifts, and where possible drive a new model for innovation in the 21st century.

36

Center for American Progress | Universities and Innovation networks

About the author
As vice provost for innovation at the University of Southern California and founding executive director for the USC Stevens Institute for Innovation, Krisztina “Z” Holly leads a team of more than 30 to translate USC’s most groundbreaking ideas to market and develop educational programs to help faculty and students make maximum impact with their ideas. Holly curates TEDxUSC, the original independently organized TED event that has spawned more than 2,000 similar events worldwide. Her columns have appeared in BusinessWeek, the Huffington Post, CNN.com, and Forbes. Before USC, Holly was an engineer and entrepreneur. Also, as the founding executive director of MIT’s Deshpande Center for Technological Innovation, she helped spin off nine start-up companies from MIT research that raised more than $40 million in venture capital. Named one of the Champions of Free Enterprise by Forbes in 2010, she serves on various advisory boards in the United States and abroad, including the U.S. National Advisory Council on Innovation and Entrepreneurship.

Acknowledgements
The author would like to offer special thanks to those who reviewed portions or all of this paper, including in alphabetical order: Brian Barge (The Evidence Network), Linda Bernardi (Cloudant, Inc.), Johanna Blakley (University of Southern California Norman Lear Center), Anthony Boccanfuso (National Academies University-Industry Demonstration Project), Claude Canizares (Massachusetts Institute of Technology), Michael Crow (Arizona State University), Joichi Ito (Creative Commons, MIT Media Laboratory), Gururaj “Desh” Deshpande (A123, Sparta Group LLC), Brad Feld (The Foundry Group), Jennifer Grodsky (University of Southern California), Randolph Hall (University of Southern California), Mark Hatch (TechShop, Inc.), Alan Kay (Viewpoints Research Institute), Carl Kesselman (University of Southern California), Cesar Hidalgo (Massachusetts Institute of Technology), Julia Lane (National Science Foundation), Michael Ledford (Lewis-Burke Associates LLC), Ellen Levy (LinkedIn), Bob Metcalfe (Polaris Venture Partners, University of Texas Austin), Steve Moldin (University of Southern California), William Ouchi (University of California, Los Angeles), Ed Paisley (Center for American Progress), Andy Rappaport (August Capital), Paul Rodeno (Security Business Bank of San Diego),

37

Center for American Progress | Universities and Innovation networks

Duane Roth (CONNECT), John Seely Brown (University of Southern California, formerly Xerox), Larry Smarr (California Institute for Telecommunications and Information Technology), Tobin Smith (Association of American Universities), Mark Stevens (Sequoia Capital,) Charles Vest (National Academies), and Mary Walshok (University of California, San Diego). Members of our taskforce on science and competitiveness provided constructive criticism, feedback, and ideas indispensable to this series. In particular, James Turner, Neal Lane, Brian Kahin, Arti K. Rai, Rachel Levinson, Daniel Sarewitz, John Alic, and Chris Hill provided critical feedback. Finally, this series would also not have been possible without important and substantive contributions from Sarah Wartell, Michael Ettlinger, Jitinder Kohli, Kate Gordon, and Reece Rushing.

38

Center for American Progress | Universities and Innovation networks

References
Agrawal, Ajay, and Rebecca Henderson. 2002. “Putting Patents in Context: Exploring Knowledge Transfer from MIT.” Management Science 48 (1): 44–60. Available at http://mansci.journal.informs.org/content/48/1/44. short. American Academy of Arts and Sciences (AAAS). 2008. “ARISE: Advancing Research in Science and Engineering.” Cambridge. Available at http://www. amacad.org/AriseFolder/. Association of University Technology Managers. 2010. “AUTM U.S. Licensing Activity Survey: FY2009.” Deerfield.. Available at http://www.autm.net/ AM/Template.cfm?Section=Licensing_Surveys_ AUTM&CONTENTID=5239& TEMPLATE =/CM/ ContentDisplay.cfm. Atkinson, Robert, and Scott Andes. 2009. “The Atlantic Century: Benchmarking EU and U.S. Innovation and Competitiveness.” Washington: The Information Technology and Innovation Foundation. Available at http://www.itif.org/files/2009-atlantic-century.pdf. Bureau of Economic Analysis. 2010. Research and Development Satellite Account (1998-2007 research and development data). Department of Commerce. Available at http://www.bea.gov/national/ newinnovation.htm. Block, Fred, and Matthew Keller. 2008. “Where Do Innovations Come From? Transformations in the U.S. National Innovation System, 1970-2006.” Washington: The Information Technology and Innovation Foundation. Available at http://www.itif.org/index. php?id=158. Carayannis, Elias, Suleiman Kassicieh, and Raymond Radosevich. 2000. “Strategic alliances as a source of early-stage seed capital in new technology-based firms.” Technovation 20 (11): 603-615. Churchman C.W. 1967. “Wicked Problems.” Management Science, 14 (4) (1967): B141-142. DiGregorio, Dante, and Scott Shane. 2003. “Why Do Some Universities Generate More Startups than Others?” Research Policy 32 (2): 209-227. Doctorow, Cory. 2009. Makers. New York: Tor Books. Donohue, Thomas. Testimony to the House Committee on Science and Technology on the Reauthorization of the America COMPETES Act, January 20, 2010. Available at https://www.uschamber.com/issues/ testimony/2010/100119_americacompetes.htm. Ezell, Stephen, and Robert Atkinson. 2010. “The Good, the Bad, and the Ugly of Innovation Policy.” Washington: The Information Technology and Innovation Foundation. Available at http://www.itif. org/publications/good-bad-and-ugly-innovationpolicy. Goodman, Peter, and Philip Pan. 2004. “Chinese Workers Pay for Wal-Mart’s Low Prices: Retailer Squeezes Its Asian Suppliers to Cut Costs.” The Washington Post, Feb. 8, p. A1. Gulbranson, Christine, and David Audretsch. 2008. “Proof of Concept Centers: Accelerating the Commercialization of University Innovation.” Kansas City: Kauffman Foundation. Hagel, John, John Seely Brown, and Lang Davison. 2010. The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion. New York: Basic Books. Hira, Ron. 2009. “U.S. Workers in a Global Job Market.” Issues in Science and Technology Spring 2009. Available at http://www.issues.org/25.3/hira.html. Holly, Krisztina. 2009. “Venture Capital-University Interface: Best Practices to Make Maximum Impact.” Tomorrow’s Technology Transfer (AUTM Journal) 1 (2). Available at http://stevens.usc.edu/programs_research. php. ———. 2010. “The Full Potential of University Research: A Model for Cultivating New Technologies and Innovation Ecosystems.” Science Progress, June 8, 2010. Available at http://www.scienceprogress.org/2010/06/ the-full-potential-of-university-research/. Holly, Krisztina, K. Kerr, and R. Hull. 2011. “The Evolution of Funding Sources for University Spinout Companies: Case Study from the University of Southern California.” White paper (forthcoming).

39

Center for American Progress | Universities and Innovation networks

Hourihan, Matt, and Matthew Stepp. 2011. “A Model for Innovation: ARPA-E Merits Full Funding.” Washington: The Information Technology and Innovation Foundation. Available at http://www.itif. org/publications/model-innovation-arpa-e-merits-fullfunding. Kane, Tim. 2010. “The Importance of Startups in Job Creation and Job Destruction.” Kauffman Foundation Research Series: Firm Formation and Economic Growth. Available at http://www.kauffman.org/ uploadedFiles/firm_formation_importance_of_ startups.pdf. Kenny, Martin, and Donald Patton. 2010. “Firm Database of Initial Public Offerings (IPOs): From June 1996 through 2006, Version A.” Available at http://www. kauffman.org/Blogs/DataMaven/May-2010/IPODatabase.aspx. Levin, Sharon, and Paula Stephan. 2010. “Linking Investigator-Initiated Federal Research Grants with the Production and Scientific Development of Doctoral Scientists and Engineers.” Prepared for Science of Science Measurement Workshop, Dec. 2-3, 2010. Washington. Available at http://www.nsf.gov/sbe/ sosp/workforce/levin.pdf. McCormack, Richard. 2009. “The Plight of American Manufacturing,” American Prospect, December 21. Available at http://prospect.org/ cs/articles?article=the_plight_of_american_ manufacturing. Meri, Thomas. 2009. “Eurostat: Statistics in Focus.” Available at http://epp.eurostat.ec.europa.eu/cache/ITY_ OFFPUB/KS-SF-09-025/EN/KS-SF-09-025-EN.PDF. National Academies. 2010. “Rising Above the Gathering Storm, Revisited: Rapidly Approaching Category 5.” Washington: The National Academies Press. Available at http://www.nap.edu/catalog/12999.html. National Advisory Council on Innovation and Entrepreneurship (NACIE). 2011. “Improving Access to Capital for High-Growth Companies.” Report to Secretary Locke. Department of Commerce. Available at http://www.eda.gov/PDF/NACIE_Report-Access_ to_Capital.pdf. National Institutes of Health (NIH). 2004. Average age grant data. Available at http://grants.nih.gov/grants/ new_investigators/Average_age_initial_R01.xls.

National Science Board. 1998. “Private Use of Public Science.” Science and Engineering Indicators 1998. Arlington: National Science Foundation. Available at http://www.nsf.gov/statistics/seind98/pdf/c6.pdf. ———. 2010. Science and Engineering Indicators 2010. Arlington: National Science Foundation. Available at http://www.nsf.gov/statistics/seind10/pdf/seind10. pdf. National Science Foundation. 2009. “Division of Science Resources Statistics.” Survey of Earned Doctorates. Available at http://www.nsf.gov/statistics/ srvydoctorates. Organisation for Economic Co-operation and Development. 2009. “Education at a Glance 2009: OECD Indicators.” OECD Publishing, Table A-3.5. Available at http://www.oecd-ilibrary.org/education/ education-at-a-glance-2009_eag-2009-en. ———. 2010. “Main Science and Technology Indicators.” OECD Science, Technology and R&D Statistics (database). Available at http://www.oecd-ilibrary.org/ content/data/data-00182-en/. Palmintera, Diane, and others. 2005. “Accelerating Economic Development Through University Technology Transfer.” Reston: Innovation Associates, Inc. Available at http://www.innovationassoc.com/ docs/CT_NatRpt.ExSumm.pdf. Porter, Alan, and others. 2007. “High Tech Indicators: Technology-based Competitiveness of 33 Nations.” National Science Foundation. Available at http://www. tpac.gatech.edu/sites/default/files/doc/HTI_2007_ final_report.pdf. Pressman, Lori. (ed.). 2002. “AUTM Licensing Survey, 2001.” Northbrook: Association of University Technology Managers. Price, S.C., and P.Z. Sobocinski. 2002. “Gap funding in the USA and Canada.” Industry and Higher Education, 16 (6): 387-392. PricewaterhouseCoopers. 2011. “MoneyTree Report Q2 2011.” Available at https://www.pwcmoneytree.com/ MTPublic/ns/index.jsp. Rosenberg, Nathan. 2004. “Innovation and Economic Growth.” Organisation for Economic Co-operation and Development. Available at http://www.oecd.org/ dataoecd/55/49/34267902.pdf.

40

Center for American Progress | Universities and Innovation networks

Shane, Scott. 2008. “Three-Dimensional Printing.” Available at SSRN: http://ssrn.com/abstract=908782. Tassey, Gregory. 2009. “Annotated Bibliography of Technology’s Impacts on Economic Growth.” National Institute of Standards and Technology (NIST). Available at http://www.nist.gov/director/planning/ upload/economic_impacts_of_technology.pdf. Trune, Dennis, and Lewis Goslin. 1997. “Entrepreneurship: The New Paradigm of University Technology Transfer.” Wellesley: Babson College. Available at http://fusionmx.babson.edu/entrep/fer/ papers97/sum97/tru.htm.

———. 1998. “University Technology Transfer Programs: A Profit/Loss Analysis.” Technological Forecasting and Social Change 57 (3): 197-204. Available at http://www.sciencedirect.com/science/article/pii/ S0040162597001650. U.S. Bureau of the Census and U.S. Bureau of Economic Analysis. 2010. Press release, “U.S. INTERNATIONAL TRADE IN GOODS AND SERVICES. Department of Commerce.” Available at http://www.census.gov/ foreign-trade/Press-Release/2010pr/01/ft900.pdf. Wu, J.R. 2010. “China’s Exports Turn Upward in December.” The Wall Street Journal. January 11, p. A8. Available at http://online.wsj.com/article/ SB126310314103423521.html.

41

Center for American Progress | Universities and Innovation networks

Endnotes
1 nathan Rosenberg, “Innovation and Economic Growth” (Organisation for Economic Co-operation and Development, 2004), available at http://www.oecd.org/dataoecd/55/49/34267902.pdf. Robert Atkinson and Scott Andes, “The Atlantic Century: Benchmarking EU and U.S. Innovation and Competitiveness” (Washington: The Information Technology and Innovation Foundation, 2009), available at http://www.itif.org/files/2009atlantic-century.pdf. national Academies, “Rising Above the Gathering Storm, Revisited: Rapidly Approaching Category 5” (Washington: national Academies Press, 2010), available at http://www.nap.edu/catalog/12999.html. Organisation for Economic Co-operation and Development, “Main Science and Technology Indicators” (2010), available at http://www. oecd-ilibrary.org/content/data/data-00182-en/. national Academies, “Rising Above the Gathering Storm, Revisited.” Organisation for Economic Co-operation and Development, “Education at a Glance 2009: OECD Indicators” (2009), available at http://www.oecd-ilibrary.org/education/education-at-aglance-2009_eag-2009-en. national Science Foundation, Division of Science Resources Statistics, “Survey of Earned Doctorates,” (2009), available at http:// www.nsf.gov/statistics/srvydoctorates. Richard McCormack, “The Plight of American Manufacturing.” American Prospect, December 21, 2009, available at http://prospect. org/cs/articles?article=the_plight_of_american_manufacturing. Ron Hira, “U.S. Workers in a Global Job Market.” Issues in Science and Technology, Spring 2009, available at http://www.issues.org/25.3/ hira.html. 16 Matt Hourihan and Matthew Stepp, “A Model for Innovation: ARPA-E Merits Full Funding” (Washington: The Information Technology and Innovation Foundation, 2011). 17 national Science Board, “Private Use of Public Science” (1998), available at http://www.nsf.gov/statistics/seind98/pdf/c6.pdf. 18 national Academies, “Rising Above the Gathering Storm, Revisited.” 19 American Academy of Arts and Sciences (AAAS), “ARISE: Advancing Research in Science and Engineering” (Washington: AAAS Initiative for Science, Engineering, and Technology, 2008). 20 Hourihan and Stepp, “A Model for Innovation.” 21 Ibid. 22 Sharon Levin and Paula Stephan, “Linking Investigator-Initiated Federal Research Grants with the Production and Scientific Development of Doctoral Scientists and Engineers” (Washington: Science of Science Measurement Workshop, 2010), available at http://www.nsf.gov/sbe/sosp/workforce/levin.pdf. 23 AAAS, “Advancing Research in Science and Engineering.” 24 national Institutes of Health (nIH), Average age grant data, (2004), available at http://grants.nih.gov/grants/new_investigators/ Average_age_initial_R01.xls. 25 national Academies, “Rising Above the Gathering Storm, Revisited.” 26 AAAS, “Advancing Research in Science and Engineering.” 27 S. Price and P.Z. Sobocinski, “Gap funding in the USA and Canada.” Industry and Higher Education 16 (6) (2002): 387-392. 28 Association of University Technology Managers, “AUTM U.S. Licensing Activity Survey, 2009” (2010). 29 Krisztina Holly, R. Hull, and K. Kerr, “Financing Innovation: The Evolution of startups at the University of Southern California”(2011). 30 Dennis Trune and Lewis Goslin, “University Technology Transfer Programs: A Profit Loss Analysis.” Technological Forecasting and Social Change 57 (1998): 197-204. 31 AUTM, “U.S. Licensing Activity Survey,” available at http://www.autm. net/Surveys.htm. 32 Ajay Agrawal and Rebecca Henderson, “Putting patents in context: exploring knowledge transfer from MIT.” Management Science, 48 (1) (2002): 44–60. 33 Trune and Goslin, “University Technology Transfer Programs.” 34 Elias Carayannis, Suleiman Kassicieh, and Raymond Radosevich, “Strategic alliances as a source of early-stage seed capital in new technology-based firms.” Technovation, 20 (11) (2000): 603-615. 35 Christine Gulbranson and David Audretsch, “Proof of Concept Centers: Accelerating the Commercialization of University Innovation” (Kansas City: Kauffman Foundation, 2008). 36 Scott A. Shane, “Three-Dimensional Printing” (2008), available at http://ssrn.com/abstract=908782. 37 The Association of University Technology Managers reports that more than 11,000 patents filed in 2010 compared to just 650 hightech start-up companies launched in that same period. See www. autm.net/FY_2010_Liscensing_Survey/7008.htm

2

3

4

5 6

7

8

9

10 Thomas Donohue, Testimony before the House Committee on Science and Technology on the Reauthorization of the America COMPETES Act, January 20, 2010, available at https://www. uschamber.com/issues/testimony/2010/100119_americacompetes. htm. 11 J.R. Wu, “China’s Exports Turn Upward in December,” The Wall Street Journal, January 11, 2010, p. A8, available at http://online.wsj.com/ article/SB126310314103423521.html; and U.S. Census Bureau and U.S. Bureau of Economic Analysis, “U.S. International Trade in Goods and Services,” Press release, March 11, 2010, available at http://www. census.gov/foreign-trade/Press-Release/2010pr/01/ft900.pdf. 12 Alan Porter and others, “High Tech Indicators: Technology-based Competitiveness of 33 nations,” (national Science Foundation, 2007), available at http://www.tpac.gatech.edu/sites/default/files/ doc/HTI_2007_final_report.pdf; and Thomas Meri, “Statistics in Focus,” (Eurostat, 2009), available at http://epp.eurostat.ec.europa.eu/ cache/ITY_OFFPUB/KS-SF-09-025/EN/KS-SF-09-025-EN.PDF. 13 Peter Goodman and Philip Pan, “Chinese Workers Pay for Wal-Mart’s Low Prices: Retailer Squeezes Its Asian Suppliers to Cut Costs,” The Washington Post, February 8, 2004, p. A1. 14 national Science Board, “Science and Engineering Indicators 2010,” available at http://www.nsf.gov/statistics/seind10/pdf/seind10.pdf. See also, Bureau of Economic Analysis, “Research and Development Satellite Account, 1998-2007” (2011). available at http://www.bea. gov/national/newinnovation.htm. 15 Fred Block and Matthew Keller, “Where do Innovations Come From? Transformations in the U.S. national Innovation System, 1970-2006” (Washington: The Information Technology and Innovation Foundation, 2008), available at http://www.itif.org/index. php?id=158.

42

Center for American Progress | Universities and Innovation networks

38 PricewaterhouseCoopers, “MoneyTree Report Q2 2011,” available at https://www.pwcmoneytree.com/MTPublic/ns/index.jsp. 39 See Coulter Translational Partnership, available at http://www.whcf. org/partnership-award/overview/ 40 Diane Palmintera and others, “Accelerating economic development through university technology transfer” (Reston: Innovation Associates, Inc., 2005). 41 Gulbranson and Audretsch, “Proof of Concept Centers.” 42 Krisztina Holly, “The Full Potential of University Research: A Model for Cultivating new Technologies and Innovation Ecosystems,” Science Progress, June 8, 2010, available at http://www. scienceprogress.org/2010/06/the-full-potential-of-universityresearch/. 43 Richard Florida and others, “The University and the Creative Economy,” (2006), available at http://www.creativeclass.com/rfcgdb/ articles/University_andthe_Creative_Economy.pdf. 44 Agrawal and Henderson, “Putting patents in context.”

45 M. Dalziel and S. Parjanen, “Measuring the impact of innovation intermediaries: A case study of Tekes.” In v. Harmaakorpi & H. Melkas, eds., Practice-Based Innovation: Insights, Applications, and Policy Implications (Finland: Springer, 2011). 46 See a curriculum and institutions database of science and technology areas in Brazil: Lattes Database, available at http://lattes. cnpq.br/english/index.htm. 47 Tim Kane, “The Importance of Startups in Job Creation and Job Destruction” (Kauffman Foundation Research Series, 2010), available at http://www.kauffman.org/uploadedFiles/firm_formation_ importance_of_startups.pdf. 48 John Hagel, John Seely Brown, and Lang Davison, The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion (new York: Basic Books, 2010). 49 Chris Anderson, “In the next Industrial Revolution, Atoms Are the new Bits,” Wired, February 2010, available at www.wired.com/ magazine/2010/01/ff_newrevolution/. 50 C.W. Churchman, “Wicked Problems,” Management Science, 14 (4) (1967): B141-142.

43

Center for American Progress | Universities and Innovation networks

About the Center for American Progress
The Center for American Progress is a nonpartisan research and educational institute dedicated to promoting a strong, just and free America that ensures opportunity for all. We believe that Americans are bound together by a common commitment to these values and we aspire to ensure that our national policies reflect these values. We work to find progressive and pragmatic solutions to significant domestic and international problems and develop policy proposals that foster a government that is “of the people, by the people, and for the people.”

About Science Progress
Science Progress, a project of the Center for American Progress, is designed to improve public understanding of science and technology and to showcase exciting, progressive ideas about the many ways in which government and citizens can leverage innovation for the common good. Since its inception in the fall of 2007, Science Progress has helped shape the conversation about our country’s investment in science.

About Doing What Works
CAP’s Doing What Works project promotes government reform to efficiently allocate scarce resources and achieve greater results for the American people. This project specifically has three key objectives: • Eliminating or redesigning misguided spending programs and tax expenditures, focused on priority areas such as health care, energy, and education • Boosting government productivity by streamlining management and strengthening operations in the areas of human resources, information technology, and procurement • Building a foundation for smarter decision-making by enhancing transparency and performance measurement and evaluation

1333 H Street, NW, 10tH Floor, WaSHiNgtoN, DC 20005 • tel: 202-682-1611 • Fax: 202-682-1867 • WWW.ameriCaNprogreSS.org

Sign up to vote on this title
UsefulNot useful