Azoulay, Graff Zivin and Manso (2009)
|Title:||Incentives and Creativity: Evidence From the Academic Life Science|
|Author(s):||Azoulay, Graff Zivin, Manso|
|Citation:||Azoulay, P., Graff Zivin, J. S., & Manso, G. (2011). Incentives and creativity: evidence from the academic life sciences. The RAND Journal of Economics, 42(3), 527-554.|
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Despite its presumed role as an engine of economic growth, we know surprisingly little about the drivers of scientific creativity. We exploit key differences across funding streams within the academic life sciences to estimate the impact of incentives on the rate and direction of scientific exploration. Specifically, we study the careers of investigators of the Howard Hughes Medical Institute (HHMI), which tolerates early failure, rewards long-term success, and gives its appointees great freedom to experiment, and grantees from the National Institutes of Health (NIH), who are subject to short review cycles, predefined deliverables, and renewal policies unforgiving of failure. Using a combination of propensity-score weighting and difference-in-differences estimation strategies, we find that HHMI investigators produce high-impact articles at a much higher rate than a control group of similarly accomplished NIH-funded scientists. Moreover, the direction of their research changes in ways that suggest the program induces them to explore novel lines of inquiry.
Main Results of the Study
- Compared the effectiveness of two different ways of funding research by the HHMI (Howard Hughes Medical Institute) and NIH (National Institute of Health). The NIH funding was given to projects while HHMI funding was given to an individual. - Found that the individuals selected for HHMI funding produced more papers with higher amounts of citations then their counterparts in the NIH - The reason for this seemed to be that HHMI funded individuals could abandon unfruitful project more easily and move onto something potentially more fruitful. In the NIH however the funding was given to the project which did not give researchers at the NIH the same level of freedom to switch projects when they were found to be potentially unsuccesful. - The HHMI also had a more flexible review process initially and a more generous termination process which gave the researcher a bit more security compared to a harsher review conducted on NIH researchers.
Policy Implications as Stated By Author
- Changing the review process for grant winners could inrease total amount of papers published by scientists as there would be less pressure on researchers early in the project. - Differences in the way projects are funded could allow scientists to publish more papers as since if an individual is funded it allows more flexibility to change or tweak projects compared to the project itself being funded, which does not necessarily allow for such flexibility.