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The research spending at universities has become an integral part of development strategies among universities in the world. It is also used as one of key indicators to evaluate university ranking. Therefore, many studies have emphasized on the quality of research results and the impact of technology spillovers from universities to industry. However, the previous empirical evidence is ambiguous as well as it has not identified either the necessary time for an inventor to recoup the initial investment or the linkage between startup and research spending. To fulfill unsolved problems from previous studies, the paper focuses on finding the determinants impacting on the research expenditure at universities by employing a panel of the U.S universities from 1998 to 2004. Specifically, we implement the regression model with differentiating both the level effects and the rate effects of patent applications and licensing income, the estimated results imply that an increase in either the number of patent applications or licensing income reduces the short-term research expenditure but increases the long-term rate of research spending growth of average universities. Moreover, we also find that the more startup firms the inventors pursue, the more research spending they receive.

The impact of research results on the research expenditure at The U.S. Universities