Game-Theory Approach on a University-Industry Collaboration Model

In the fiercely competitive global marketplace, innovation alone is no longer enough. University-industry collaboration has been identified to be one of game changer to sustain the innovation ecosystem. Many research centers have been established to provide a platform for collaboration between university researchers and industrial research managers. Its benefits are substantial to both ends. The benefits are mutual, particularly in terms of students who complete university programs and join industry research and development teams. The U-I collaboration, on one hand, brings in ideas in the academic forefront to accelerate technological advancement in industrial firms, on the other hand, strengthens the education of engineers and mathematicians, and economists at universities by providing research projects generated by real technological issues from industry. It is clear that this marriage invigorates the current stereotype engineering education through new industrial challenges. However, not many university-industrial ties are as well established as university to university or company to company collaborations within academia or within industry. Thus, it is imperative to conduct a scientific study on the mechanism of university-industry collaborations and provide insights on possible measures and strategies that research centers can take to promote university-industry links. In this paper, we establish a mathematical model for the utility of both collaborative parties in a university-industry collaboration network. We analyze the criteria a firm should apply to select an academic collaborator to optimize its utility from its R&D investment which includes an investment in a future workforce. We also analyze the criteria a university engineering research team should apply to select a project from a firm to enhance its research capacity and diversify its engineering programs as well.