The Nexus between Science and Industry: Evidence from Faculty Inventions

Knowledge transfer from science to industry has been shown to be beneficial
for the corporate partner. In order to get a better understanding of the reasons behind these
positive effects, this study focuses on the junction of science and industry by comparing
characteristics of academic inventions that are transferred to industry and those staying in
the public sector. Academic inventions are identified via patent applications of German
academic scientists. We find that academic patents assigned to corporations are more likely
to enable firms reaping short term rather than, possibly more uncertain, long-run returns, in
contrast to patents that stay in the public sector. Firms also strive for academic inventions
with a high blocking potential in technology markets. Academic patents issued to corporations
appear to reflect less complex inventions as compared to inventions that are patented
by the public science sector.