Analysis and decomposition of scope economies: R&D at US research universities

Abstract

This article uses a multi output production function to analyse economies of scope between patents and R&D in US research universities. It evaluates the tradeoffs and/or synergies that arise between traditional university research outputs (articles and doctorates) and academic patents. It also investigates the sources of economies of scope and the relative roles of complementarity, scale and convexity. Nonparametric Data Envelopment Analysis (DEA) estimates of scope economies using R&D input and output data from 92 research universities show significant economies of scope between articles and patents but only modest complementarities except in a few cases. The analysis shows how scale effects (for small universities) and convexity effects can contribute to economies of scope.