Basic Research
Its argued that without government paying for it basic research would no longer be done. Imagine my surprise when I read this:
Over the last 50 years, industry-funded basic research in universities generally had kept pace with all categories of R&D, even outstripping basic research performed in companies’ own labs. And in the mid-1990s, with the explosion of transdisciplinary fields such as biotechnology, corporations began funding basic research at universities at a blistering pace: such investment grew 45 percent from 1995 to 2000, much faster than the growth of total R&D funding. But in 2000, industry abruptly reversed course.
And here I thought basic science was unprofitable making necessary federal funds for survival.
November 5th, 2007 at 8:42 pm
Obviously not all basic research is unprofitable, but there are certainly avenues of research that are either 1. Beneficial to society/human knowledge but not monetarily profitable or 2. Monetarily profitable, but probably not within the next 50-100 years. Additionally, without any government oversight/regulation, what motive do companies have to share any of that basic research with the public/each other? I’m interested in the knowledge as much as I am in the patents.
November 5th, 2007 at 8:53 pm
After 2004 things abrubtly changed course…. That’s what the article says.
The truth is that both government and industry have sort of stopped funding basic science. I see and hear a lot of basic scientists here at SFN talking about this problem. While the government and industry used to see the utility in basic discovery, the funding for such labs is not what it once was. I for one hope that industry continues big money into basic research and I hope that the government continues to give money to science. Innovation is good for everyone. It’s a worthy investment from both private and public sources.
November 6th, 2007 at 1:28 am
Darwin,
I would argue rather strongly against your first point. Its highly unlikely that there is research that benefits man while at the same time is not profitable to man. Makes no sense. Your best bet is to argue that research that is currently not useful is likely to become useful in the unforeseeable future. Of you more or less state this in your second point.
You should read the post. The guy states that the reason why private started investing in basic research is because the law changed make it more clear that whatever came of the research was owned by the company that made the investment. This is precisely how it should be. Those that take the most risk with the research should have the most say in how the resulting technology. Thats just good basic free market common sense.
Jamie,
As the post notes the reason why private entities are no longer investing is because its cheaper to invent in universities outside of the US. To improve this we should strengthen the laws making it even more clear that private firms that invest in research have control over the resulting technology. This will lead to increased private funding.
November 6th, 2007 at 2:29 am
“Its highly unlikely that there is research that benefits man while at the same time is not profitable to man.”
How about research that shows bias in the mainstream media? What private company would fund that, if it is profitable to man? I assume you think such research is beneficial to man, or you would have been wasting our time by posting a link to it.
November 7th, 2007 at 4:53 pm
I’m saying there is some research that is of benefit to mankind but cannot be easily monetized by a corporation. For instance, more private money goes into research for treatments for erectile dysfunction than for a cure/vaccine/treatment for AIDS, because there’s more money in it. This is not a problem with the free market, but a problem with letting free markets be the ONLY system doing basic research.
While I agree with a weak form of your second argument (certainly the more a company is allowed to profit from their research, the more research they will do), I think your formulation of it has an inherent flaw. It violates free market principles because it creates monopolies- ie, the first person to discover something always gets a monopoly on that thing, simply by saying no one else can make it. Monopolies should be anathema to free markets- a better system might be that the discoverer gets perpetual royalties on the profits of anyone using their discoveries, but cannot forbid anyone to use them. Then we can still have competition, as well as allowing the researchers to profit.
November 8th, 2007 at 1:12 am
Darwin your example does not prove your point. It only shows that there is more demand for erectile dysfunction then AIDS drugs. However it does not show how AIDS drugs are useful and yet not profitable.
Your second point is boring. Its trivially true that discoveries must be locked up by the discover for a certain amount of time and then opened up to the public. This is already how it works. No one is arguing that discovers should have control over their discoveries indefinitely.
The free market is the best determiner of value. If nobody is willing to fund a kind of research then there is a really good chance that such research is absolutely useless to the public. If we exempt unforeseeable value from basic research then a hard and compelling argument can be made that such basic research that can not find private funding is research that will never benefit the taxpayer. If the market finds no value in the research then why would the taxpayer? The taxpayer as the de facto consumer has already passed on the value of the research.
Again this argument does not handle unforeseeable value in basic research which is really the only justification for state subsidize basic research.
November 8th, 2007 at 2:01 am
My example is relevant because I’m claiming that AIDS research is of greater intrinsic value to humanity as a whole than research on erectile dysfunction, but that erectile dysfunction will get studied more heavily becuase there’s more money in it. I disagree with you that the free market accurately determines the wort of such research, because I do not bleieve that research which provides monor convenience to rich Americans is intrinsically better than research that saves the lives of poor Africans. While it’s true that the free market accurately judges the ‘value’ of such research in monetary terms, I do not think this is a sufficient measurement of the worhtiness of the research.
More specifically, the free market inequalities between countries, while regretable, make sense as a neccessary evil for the very advantageous free-market system. Goods have to be manufactured, shipped, and sold somewhere, have to be transported over borders, be taxed for importation, et, and therefore due to physical and political realities, there will always be wealth differentials between countries. However, these same difficulties do not apply to ideas, unless they are artificially imposed by the state.
My second point is not just saying that discoveries should be briefly locked up, then open to the public. First of all, that’s astill a monopoly; even a temporary monopoly should be detrimental to the efficiency of the free market. Second of all, it means the discoverer may stop profiting entirely after that window has expired, lessening the incentive to do research. AGain, I wonder if a perpetual royalty scheme would make more sense, and lead to better free-market competition, than a temporary monopoly scheme.