A new article published in Science examines the growing role of public funding in driving innovation:
Innovation increasingly relies on scientific knowledge. Research to generate that knowledge has historically been funded by both industry and government. Although industry and government research spending was relatively equal in 1980 in the United States, by 2010 their shares had shifted to 60% and 30%, respectively. Yet, despite this increase in industrial spending, firms appear to be pursuing—or at least publishing—less basic science. If corporations are doing less basic research, then where do they find the ideas to fuel their innovation? Here, we detail individual bibliometric linkages across tens of millions of documents and quantify the broad sweep and impact of U.S. federally supported research on patented innovation over most of the past century. We illustrate how patentees, both U.S. and non-U.S., and corporations in particular, increasingly depend upon federally supported research as a source of scientific knowledge. Although multiple mechanisms interact and contribute to the trend, federal research increasingly appears to fuel the innovation that ultimately leads to jobs, industrial competitiveness, and entrepreneurial success.
The researchers looked at all patents granted to domestic inventors since 1926. Despite the decline in the government’s share of total R&D spending over recent decades, there has been a persistent increase in the number of patents that are owned by publicly-funded researchers, that cite the patents of publicly funded researchers, or that cite the articles of publicly funded researchers.
Crucially, this growth seems overwhelmingly driven by an increase in corporate citations of publicly funded research. The vast majority of patent owners in this category are corporations. While there has only been a slight bump in the number of corporate patent owners receiving some public subsidy, there has been sizable growth in the number of corporate patent owners citing publicly funded research. The researchers found this is not an artifact of changing citation practices or technology alleviating the burden of searching for all prior art. Instead, the increase in government reliance comes from private firms having greater interest in what publicly funded researchers are discovering.
More relevant to the complementary relationship between private- and public-sector research, the authors found that corporate patents that cite government-funded research tend to be of higher quality than other corporate patents, and more federal research priorities are directed towards fields the private sector is also exploring.
These trends cast additional unfavorable light on the explosion in patent awards since the 1980s. Government R&D spurring innovation in the private sector is welcome news. The appropriation of the findings from taxpayer-financed research for private benefit is not.