Professors Ashish Arora and Sharon Belenzon say pharmaceutical discoveries and AI show the first-mover advantage of companies engaging in scientific research
Science is at the root of inventions that improve lives and increase firms’ productivity and profits. But Professor Ashish Arora of Duke University’s Fuqua School of Business says companies who rely on public scientific discoveries may find it difficult to earn above-average returns from the innovation.
“When you have a public resource, like university science, which is available to all—including your competitors—how do you extract a private benefit from that resource?” Arora asked.
In a new paper, published in the Research Policy journal, Arora and co-authors Sharon Belenzon of Fuqua and Bernardo Dionisi, a Fuqua PhD candidate, argue that being a first mover in science-based inventions justifies corporate investment in scientific research.
EPO is a good example, Arora said.
Patients undergoing dialysis or otherwise suffering from anemia, he said, benefit from a hormone called Erythropoietin (EPO), first purified by Professor Eugene Goldwasser of the University of Chicago, who described EPO’s role in stimulating the production of red blood cells.
[This article has been reproduced with permission from Duke University's Fuqua School of Business. This piece originally appeared on Duke Fuqua Insights]