University-Industry collaboration

UNIVERSITY-INDUSTRY COLLABORATION

COMPARARTIVE ANALYSIS ON SCIENCE, TECHNOLOGY AND INNOVATION POLICY

Name: Joshua Kwame Nkrumah

Student ID: Mep14110

Instructor: Professor Patarapong Intarakumnerd

Course number: STI2080E/STI7081E

Course name: Comparative Analysis on Science, Technology and

Innovation Policy

Term: Fall

JANUARY 27, 2015

NATIONAL GRADUATE INSTITUTE

FOR POLICY STUDIES (GRIPS)

Joshua Kwame Nkrumah Mep14110

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Abstract

University-industry collaborations have a long history especially in the advanced economies

and more recently in emerging economies as well. The collaborations have had their own

challenges across different countries and different countries have managed to surpass such

difficulties. This notwithstanding, there are still some impediments to realizing the optimal

collaborations between these two sectors. This paper discussed the evolution of the university-

industry linkages and most importantly made recommendations for reforms.

Introduction

It is generally accepted that universities have a crucial role to play in every country as centres

which produce and transfer knowledge. In contemporary times, there have been arguments as

to whether universities can assume extra roles as key players in economic development in

addition to its traditional roles of teaching and research (Branscomb et al., 1999; Mansfield,

1995 as cited in Este & Patel, 2007). Scholars agree that university-industry partnership is an

essential channel for technological diffusion which contributes immensely towards innovation

(Martin & Scott, 2000). For this reason, Branscomb, Kodama & Florida (1999) argue that

research-oriented universities in advanced economies are constantly seeking avenues to

commercialise research as an opportunity to connect universities and economic performance.

Branscomb et al, (1999) further queried that is it justifiable to expect research-oriented

universities to make significant and direct contribution towards industrial innovation, if so, to

what degree has this been done? However, Adeoti, J., Nabudere, D., & Kruss, G. (2012) notes


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that the evolving third mission or role of universities and their contribution to innovation and

national economic development has not trickled down to low income countries.

With this background, these questions are pertinent. How has the university-industry linkages

evolved? What models of university-industry collaborations exist? How have the university-

industry collaboration played out in different countries? What are some of the challenges that

faces the smooth collaboration between universities and industries? This paper therefore aims

at analysing the evolution of the university – industry interactions and how such interactions

have played out among different countries, challenges faced and recommendations for reforms.

Evolution of the roles of universities

In developed economies, institutions of higher learning such as the universities have been

among the earliest forms of institutions and are still vibrant in contemporary times. The

universities over the past years have not only been dynamic in adapting to situations and

challenges but also expatiated both in size and diversification of its operations (Ben-David,

1977). The history of institutions of higher learning such as the universities have a long history.

The earliest universities were established during the mid-ages in Europe specifically in the cities

of Bologna in Italy and Paris in France. Their power to govern themselves were recognized by

both the church and the government alike (Fagerberg, Mowery, & Nelson, 2005).

This system of the universities being autonomous institutions continued until the emergence of

modern states where the government assumed greater control over public universities in some

parts of continental Europe (Fagerberg et al., 2005). However, this centralized system of

controlling public universities was not so visible in Britain and the United States of America

throughout the ninetieth and twentieth centuries (Fagerberg et al., 2005). The basic and most

primary duty of education has been to passing on civilization from one generation to the other.

But most importantly, it is expected of educational institutions of higher learning such as the

universities not only to churn out graduates with the necessary skills but also to equip them with


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global knowledge to meet local needs (Diyamett & Mwamila, 2009). The roles of universities

have evolved overtime. Diyamett & Mwamila (2009) noted that the core roles of universities

were to teach and research and these traditional roles assigned to universities were parallel to

the productive sectors of the economy. This assertion is further stressed by OECD that the roles

of universities have evolved over the last two decades and that teaching and research were the

focal point of the universities which were disassociated from the socio- economic development

of the state in general and the industry in particular (OECD, 1999).

University – Industry collaboration

The collaboration between universities and industry (U-I interaction) is not a new phenomenon

but it only gained prominence around the 1970’s and since then the U-I interactions has come

to be accepted by both government and policy makers alike (Vedovello, 1998).

Research oriented universities play a major role as an originator of knowledge and technologies

relevant to industrial development in many knowledge intensive economies (Fagerberg et al.,

2005). Adeoti, et al., (2012) contend that knowledge is a requirement for economic

development and for that reason, universities are deemed as an important centres for learning

and innovation for industries in advanced economies. As states continually move towards

knowledge-based economies, universities are also gearing towards meeting the demand for

basic knowledge and skilled human resources (Hall & Rosenberg, 2010). As economies of

countries are becoming global in nature and knowledge - intensive, firms and governments are

looking out for new channels of technologies, skills and knowledge (OECD, 2007). In

recognition of this kind of collaboration, governments of the highly industrialized countries and

other stakeholders have initiated various measures since the 1970’s in order to foster a closer

relationship between academia and industry. Many of such policies seek to promote economic

development based on academic research (Fagerberg et al., 2005). Lundvall (1999) noted that

universities promotes economic development in advanced economies by serving as sources of


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knowledge. In the same vein, Adeoti et al, (2012) contend that universities in developing

economies are also expected to meet the local demand for knowledge based economies which

would bring about socio-economic development.

Frame works for cooperation between universities and industries.

Linear model

There have been several forms of assumptions or concepts which seeks to discuss the relations

between academia and industries, and one of such frameworks is the linear model. This

model argues that universities play a major role in economic growth and for that reason

governmental funding of basic research should be increased especially in the United States. It

further argues that the funding of basic research was a sine qua non for speeding up innovation.

However, this model has often been criticized using the Japanese economy that basic research

may not be a panacea for improving innovation (Fagerberg et. al., 2005).

Mode 2 framework

One of such frameworks for analysing the role of academic research in industrialization is the

Mode 2 concept. This concept unlike other models, in addition to forging a closer link between

universities and industries, this model argues that the U – I interactions should be

complemented with interactions with other institutions. It seeks to champion the

interconnectedness of a network of several actors in the national innovation system. This model

denotes a broader and diversified knowledge base (Fagerberg et al., 2005).

Triple Helix framework

This concept argues that universities can play a more dominant role in the innovation process

in knowledge intensive countries (Etzkowitz & Leydesdorff, 2000). This model argues for an

increased cooperation among the relevant actors in the innovation process of advanced societies

(Fagerberg et al., 2005). Etzkowitz et al. (1998) argues that adding to the collaboration between


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the various actors of the innovation process, academia should take on entrepreneurial roles such

as establishing companies and firms and must also take on the role of academia so as to transfer

knowledge among each other. The model is criticized for its inability to state the extent to which

the entrepreneurial role of the universities are being carried out throughout academia (Fagerberg

et al., 2005).

Comparative analysis of policies and practices

With regards to funding for institutions of higher learning such as the universities, several

countries have had their own peculiar challenges but manages to find their way out. Etzkowitz,

Webster, Gebhardt, & Terra, (2000) note that universities in the United States had undergone

monumental changes over a period. They contend that under worsening financial situations,

academic researchers had to give up on their research plans and embark on more aggressive

means of obtaining funding from either internally or from sources outside. This situation in the

United States was similar to the prevailing case in the United Kingdom. Etzkowitz et al, (2000)

noted that in the United Kingdom (UK), public funding for universities was attached to whether

it contributed directly towards economic development. They argue that this situation in the UK

led the UK universities to seek industrial funding. Fagerberg et al. (2005) again contend that

the stringent financial difficulties faced by the universities in the United States also forced the

universities to take a first step towards forging a closer relationship between industry and

academia as a means of seeking sources of funding. For example, an academic at the University

of California Berkeley established a research corporation and this set the pace for using funds

generated by patents to start funding their research. Fagerberg et al., (2005) opines that these

circumstances made the universities in the United States more entrepreneurial. This situation is

not so much different from that which was faced by universities throughout the OECD

countries. Fagerberg et al. (2005) noted that the OECD countries had also had their fair share

of stringent financial constraints in the 1970’s. These situations were in contrast to what was


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prevailing in some Latin American, Asian and some European countries where basic and even

applied research were being conducted in government research institutes (Etzkowitz et al,

2000).

In analysing the university-industry linkages in the United States and Japan, Branscomb et al,

(1999) noted that there are some similarities and differences among the kind of policies and

practices embarked upon by these countries which nevertheless have yielded somewhat

different outcomes. In their analysis, they stated that both countries are trying to emulate the

strengths of each other. For example while Japan are concentrating their efforts towards the

creation of new firms and industries, the United States are focusing much more on promoting

university-industry relations which would boost their manufacturing sector. However, Cohen,

Florida & Goe (1994) noted that the degree of impact of the different policies between the

United States and Japan has seen different outcomes. For example, with regards to the number

of university-industry research and development (R&D) centres, there were 1,056 of them by

1990 compared to the 49 R&D centres operating in the realm of the university-industry

collaborations in 1997. Branscomb et al, (1999) again noted that the amount of industry support

differed significantly among the two countries. They note that in 1994, industry support in the

United States amounted to 7.0% of university research whiles a modest figure of 3.6% to Japan.

In addition, university patent licensing about $266 million for the United States and a rather

low amount of less than $300,000 for Japan.

With reference to industrial perspectives on the collaboration between universities and

industries, Japan and the United States share a lot of similar opinions yet notwithstanding the

similarities, there are divergent paths due to several factors. For example, key players in both

academia and industry share the same notion about the need to foster more fruitful relationship

between academia and industry and also recognise the challenges thereof (Branscomb et al,

1999). In the pre-war years in both the United States and Japan, universities and industries were


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forging good relationships, however in their post-war era the university-industry relationships

took divergent paths. In Japan, establishing formal connections between industry and academia

after the split of relationship has still not been fully realised. This can be contrasted with the

prevailing situation in the United States at the time. In the United States, the involvement of the

universities in the war period even bolstered the relationship between academia and industry.

For example in the United States, a significant number of research-oriented universities built

even stronger bonds with industries which culminated into the universities instituting

technology licensing agencies in industries. These offices served as intermediaries which

facilitated the contracting and intellectual property aspects of the university-industry

relationships. Contrary to the building of formal relationship between universities and

industries, in Japan there were rather informal collaboration between the two sectors

(Branscomb et al, 1999). Formal relationship was lacking because industries had become so

successful in Japan and developed their own in-house educational centres and so there was no

need to look up to universities as sources of innovation (Odagiri & Goto, 1993). Branscomb et

al, (1999) note that the relationship further sunk because academics distanced themselves from

industrial activities and even wanted autonomy from all industrial issues (Branscomb et al,

1999).

Challenges to the smooth collaboration between universities and industries

There is a demand on universities in developing countries to meet the developmental challenges

of their societies and for that reason the actors concerned are looking out for measures to

enhance the university – industry interaction (Hershberg, Nabeshima, & Yusuf, 2007). Yet there

are concerns that the approaches and policies imported to help fix the developmental challenges

of developing countries are adopted in an imitative manner without considering the specific

situations of the economies involved. In Sub-Saharan African countries for example, there are


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variations between the universities and industries with regards to the technological, scientific

and interactive capacities (Adeoti, et al., 2012).

Again another challenge confronting the smooth interaction between academia and industry is

the problem of “cultural differences”. It is argued that professional or cultural norms that guide

the operations of both academia and industry differs to a large extent. For researchers in

academia, one’s ability to gain recognition is dependent on being able bring to the notice of the

general public the published outcomes of their research in addition to the methodology used.

On the contrary, industrial research thrives mostly on secrecy of their research and its details

(Fagerberg et al., 2005).

In addition, there is basically the lack of conceptual framework to guide the effective interaction

among the actors in the innovation process especially in the developing countries. This therefore

makes the triple helix model of no use to the developing countries where their knowledge base

is dwindling. The triple helix framework which advocates for the effective interaction between

universities, industry and government has only focused on the developed and industrialized

countries (World Bank, 2002 & UNDP, 2001 as cited in Saad, M. & Zawdie, 2011; Chandra.

et al., 2008).

Saad, M. & Zawdie, (2011) notes that there is a problem affecting the effectiveness of

universities in developing countries. They argue that not that the universities have no

contribution to make towards the development of their respective economies but rather, the

universities are not so much embedded into developmental process of their respective

economies. This they agree that is a problem among the less developed even among the

developing countries. They again note that there are records to prove that some developing

countries have experienced some modicum of progress with reference to capacity building and

networking which contributes to the innovation process. This can however be contrasted with


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that of the relationship between universities and firms in the developed and industrialized

countries.

Lastly, Saad, M. & Zawdie, (2011) bemoans that universities in developing countries are mostly

cut off from the processes leading to development and this is due to how the universities evolved

which is ingrained in cultural and belief systems which runs parallel to the developmental needs

of modern economies. They further go on to state for example that India’s institutions of higher

learning have over the past 150 years remain distant from contributing to the country’s

innovation system.

Policy implications

Fagerberg et al., (2005) posits that perhaps the financial difficulties that the universities in the

United States faced even made them assume an entrepreneurial role of embarking on aggressive

search for funds. Moreover, in the 1980’s the United Kingdom’s central government cut down

on higher education in the United Kingdom. Notwithstanding, co-authorship soared even

higher. According to Etzkowitz et al, (2000) the financial cuts to the UK universities forced

them to engage with industry. Developing economies can also replicate some of these paths set

by the advanced countries and by so doing not only would they be able to secure other sources

of funds but also the university-industry collaborations will even be more fruitful for national

development.

Branscomb et al, (1999) noted that the effective collaboration between the industry and

academia in the United States led to the establishment of a liaison office which served as an

intermediary in overseeing the smooth running of the university-industry relationship. This can

be emulated by developing and emerging economies to foster the relationship between

universities and industries in their respective countries.


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Again, policy makers of emerging countries should put in place pragmatic policies to ensure

that industry and universities do not run parallel. In the case of Japan, Branscomb et al, (1999)

noted that academia wanted to distant themselves from industrial activities and even sought for

autonomy from industrial activities amidst government intervention. They noted again that in

the case of the United States, universities established technology licensing offices in industries

all to forge good relationship. Universities in emerging economies can also initiate such good

rapport between universities and industries by such kind of centres in industry. Branscomb et

al, (1999) opine that mobility between and among universities and industries can also serve as

an avenue for effective human relationship which would lead to transfer of knowledge.

There are concepts aimed at fostering university-industry relations among which includes

Triple helix and so forth. However, Chandra et al., (2008) argues that triple helix is designed to

only suit the developed economies to the neglect of the developing countries. Schiller (2006)

argues that some of these concepts should be redesigned to fit into innovation systems in

developing countries as well. When there are frameworks to guide the interactions, emerging

economies can also benefit from such fruitful collaborations.

Adeoti, et al. (2012) bemoans the fact that some emerging economies import policies and

practices from elsewhere in whole without paying attention to the differences in their

environmental settings and such policies and practices tend not to fit well into the

developmental framework of such emerging countries. Schiller (2006) posits that the mode 2

framework which advocates for diversification of the knowledge base and also localisation of

research activities can be applied to the context of developing countries who aspire to develop

by developing policies and practices to fit into their own developmental context.

Etzkowitz et al., (1998) argue that adding to the collaboration between the various actors of the

innovation process, academia should take on entrepreneurial roles such as establishing

companies and firms must also take on the role of academia so as to transfer knowledge among


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each other. Governments of developing countries who seek to build better relationship between

universities and industries can put in place policies whereby there will be that avenue for

universities to directly contribute to economic and industrial development.

Conclusion

Several scholars such as Fagerberg et al., (2005) have underscored the leading roles universities

play as sources of knowledge and man power in contributing to the economies of both advanced

and emerging economies alike. However, Diyamett and Mwamila (2009) noted that the roles

of universities have evolved overtime and that the core roles of universities were to teach and

research, and these traditional roles assigned to universities were parallel to the productive

sectors of the economy. This notwithstanding, there have been tremendous efforts geared

towards fusing universities and industries despite their different areas of operation (Fagerberg

et al., 2005). There have been several models to foster this relationship but scholars such as

Chandra et al., (2008) argues that some of the models fit well for the developed economies and

not the developing ones. Notwithstanding this mixed interpretations about these models, such

collaborations between industry and academia has worked well for some countries such as the

United States and are often cited as a success story of this collaboration though Fagerberg et

al., (2005) notes that this achievement of the United States has been mixed. Others scholars

are also calling for the localization of research to help emerging countries develop as well

(Schiller, 2006). This paper shared some light on the evolution of university-industry

relationships and discussed the framework to forging better relationship between universities

and industries. In addition to this it sought to elaborate some challenges facing the smooth

collaboration between these two sectors and policy recommendation for reforms.

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University-Industry collaboration