The norms of entrepreneurial science: cognitive effects of the new university–industry linkages

Abstract

Universities are currently undergoing a `second revolution' these days, incorporating economic and social development as part of their mission. The first academic revolution made research an academic function in addition to teaching. Now the emerging entrepreneurial university integrates economic development as an additional function. The `capitalisation of knowledge' takes many different forms that are discussed in this article.

Introduction

Entrepreneurial activities of scientists are by no means totally new phenomena. Such things occurred in 17th century German pharmaceutical science. Another famous example is Justus Liebig's fertiliser venture in the mid 19th century (Etzkowitz, 1983). However, these and other chemical spin-offs did not affect academic research sites. The formation of industrial consulting and scientific instrumentation firms by scientists also took place in the late nineteenth century at Harvard and MIT but were anomalies at the time (Shimshoni, 1970). During the past two decades, however, an increasing number of academic scientists have taken some or all of the steps necessary to start a firm by writing business plans, raising funds, leasing space, recruiting staff, etc. (Blumenthal et. al., 1986; Blumenthal, 1986a; Krimsky et al., 1991). Empirical studies which investigate these matters likely underestimate the extent of faculty involvement, especially in molecular biology. For example, although a survey identified half the faculty of the MIT biology department as having industrial ties in the late 1980s, an informant could identify only one of his colleagues as uninvolved. Although still only a minute proportion of the total US academic enterprise is directly involved, faculty inventing and commercialisation has had significant cognitive and organisational consequences.

A complex web of relationships has grown up among academics, university originated start-ups and larger firms. Often the same academic scientists are involved in both types of companies, managing a diversified portfolio of industrial interactions (Powell et al., 1996). Indeed, some early critics of such activities have become entrepreneurial scientists themselves. Nobelist Joshua Lederberg found the scientific issues and financial rewards too intriguing not to get involved. Another Nobelist, Arthur Kornberg, expressed bemused bewilderment in his autobiography `The Golden Helix' that a highly focused academic scientist such as himself had become an advocate of industry/academic intersection, finding it fruitful for both science and business.¹

Remarkably, even those who leave academia retain ties. Having been turned down for tenure by Columbia University's Computer Science Department in the mid 1980s, David Shaw applied his computing skills to financial analysis and drew upon former colleagues and students for his firm's original talent pool. The D.E. Shaw & Co., a global investment bank, currently advertises to recruit, “unusually talented and accomplished individuals with degrees in any area of the sciences or humanities… to a career they may never have considered before…” (Advertisement in Political Science Quarterly, 1997). In the face of a tight academic job market, opportunities have opened up in firms based upon academic knowledge.

Until quite recently the commercialisation of academic research typically took place at a distance, by former students with or without the knowledge of their mentor. A striking comparison illustrating the change in this respect are sociologist Robert K. Merton and economist Robert C. Merton, father and son. In the early 1990s the New York chapter of the Public Opinion Research Association held a special meeting honouring Prof. Robert K. Merton, who was astonished to learn that a multimillion advertising and political industry had grown out of `focus groups,' an interviewing technique that he had developed in the course of a 1940s study of interracial housing. In contrast, press reports of Prof. Robert C. Merton's 1997 Nobel Prize in economics, for a method to judge risks in options pricing, noted that he was a principal in a Greenwich Connecticut firm using these techniques in its business. The quite different stances of the Mertons to the pecuniary outcomes of their research exemplifies the generational change in attitude among academic scientists toward involvement in commercialisation.

This article analyses the cognitive effects of the new university/industry linkages on the way scientists view research, interpret the scientific role, and interact with colleagues, companies and universities. The growth of a commercial ethos within academia, and the emergence of conflict lines over this development, culminates in normative change in science. Traditionally, the most deeply held value of scientists is the extension of knowledge. To contribute to this is the highest striving of a scientist. The incorporation of `extension of knowledge' into a compatible relationship with `capitalisation of knowledge' is a profound normative change in science. It will be shown that the transition to entrepreneurial science is occurring as an interplay of cognitive opportunities, institutional rearrangements, and normative change, and that this in turn has cognitive effects on future research agendas. Certain cognitive changes in a growing number of disciplines and scientific fields open up possibilities to scientists to meet two goals simultaneously: the pursuit of truth and profit-making. Accordingly, the norms of science which traditionally condemn profit-making motives are beginning to change to allow for such a kind of entrepreneurship; and varying institutional structures are experimented with which fit to these new cognitive and normative patterns (Merton, 1973[1942]; Etzkowitz, 1994).