Research grants should not be tied to commercialization: study

Toronto, ON – Canadian universities lag behind their US counterparts in generating technology transfer between academic research and companies, and improved policies are needed to address the problem, according to a report released today by the C.D. Howe Institute. In “From Curiosity to Wealth Creation: How University Research can Boost Economic Growth,” author Peter Howitt recommends how governments can improve the incentives for universities and their researchers to pursue research lines that can eventually be commercialized.

Contrary to what the federal government has done recently, Howitt says the best way to promote technology transfer is not to target research at business needs. Instead, he argues that the best approach is to let the two sides of the partnership, academia and business, do what they do best.

“We need to promote a division of labour. Research grants shouldn’t be tied directly to commercialization,” he says. “The evidence shows that the best approach is to create first-rate universities where first-rate scientists can pursue research that appeals to their curiosity, and encourage business to invest in commercializing their discoveries.”

The source of technological innovation is research and development (R&D), most of which takes place in the private sector of the economy. University research, however, is the source of the basic building blocks of many of the core sectors of the economy, in everything from information technology to pharmaceuticals and much more.

Improving the links between discoveries and commercialization is crucial. Although the federal and provincial governments are taking steps to encourage the commercialization of research, Howitt argues that they should go further by:

• building on recent reforms to the National Research Council that make it more business-oriented, but with the eventual goal of making it a pan-Canadian technology transfer institution, leaving federal funding for research to granting organizations;
• requiring that all federally funded research papers appear in open access online repositories;
• developing a set of templates available to all university researchers that outline the terms of commercialization – such as intellectual property rights or revenues – between universities, researchers and their business partners; and
• letting university researchers operate as “free agents” rather than tying them to their university’s designated technology transfer office.

Rather than governments directing researchers to pursue business-related research, says Howitt, the overarching priority for Canada should be to attract the best researchers in the world. “Though it may seem paradoxical, the evidence supports the view that the greatest benefit to society will come from scientists for whom practical utility and individual financial reward are minor considerations.”

“The best way to attract such scientists to Canada is to redirect our research support towards the problems that are most challenging from a scientific point of view, not towards those that bureaucrats view as most likely to lead to commercial success,” he concludes.