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Restructuring Research: Communication Costs and the Democratization of University Innovation

Ajay Agrawal, Avi Goldfarb

American Economic Review · 2008 · Volume 98 · Issue 4

DOI: 10.1257/aer.98.4.1578

Abstract

We report evidence that Bitnet adoption facilitated increased research collaboration between US universities. However, not all institutions benefited equally. Using panel data from seven top engineering journals, Bitnet connection records, and institution ranking data, we find that middle-tier universities were the primary beneficiaries; they benefited largely by increasing their collaboration with top-tier schools. Furthermore, we find that the magnitude of this effect is greatest for co-located pairs. Thus, the advent of Bitnet – and likely of subsequent networks – seems to have increased the role of middle-tier universities as producers of new knowledge in the national innovation system. (JEL D85, I23, O31, O33)

Keywords

Network Formation and Analysis: Theory, Higher Education Research Institutions, Innovation and Invention: Processes and Incentives, Technological Change: Choices and Consequences, Diffusion Processes

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