Leveraging research universities

For creating high-paying jobs and driving prosperity through engaging students and graduates, there could be a natural argument for investing in developing research universities. The rationale is simple: it has worked in the USA and a few other countries. Besides, as human capital, publications, and patents are ingredients of innovations, such an argument gets further momentum. However, how to transfer the outputs of research universities-high-calibre graduates, publications, and patents--into economic value in a globally competitive market is a challenge. For example, although India publishes more scientific articles than Japan, India's success in creating economic value from those publications is yet to be comparable to those of Japan.

On the other hand, although two Americans got the Nobel Prize for inventing lithium-ion batteries, American companies like Tesla depend on China's CATL for the battery pack of electric vehicles. However, many of the Nobel Prize-winning Japanese research achievements are linked to creating new waves of growth in commercial products, from light bulbs to television. Besides, a growing number of engineering graduates, as high as 80 per cent in India, are failing to get engineering jobs, raising questions about the return on investment. Hence, how to transfer the outputs of research universities into economic value in a competitive market is a precursor to investing in research universities.

If there had been a linear correlation between the outputs of research universities and economic prosperity, many less developed countries could reach high-income status within the next couple of decades. To reason with broader challenges, we may look into ground-level reality.

Despite the success of the Indian Institutes of Technology (IIT) in producing high-calibre graduates, why could India not develop a single global-scale innovation company? On the other hand, despite having 7 out of the top 10 universities in engineering, why has the USA lost the silicon edge to tiny Taiwan? Besides, the USA has lost innovation epicentres of their many critical inventions to Japan, turning them into an importer. On the other hand, despite not occupying any top spot in engineering education and research, why has Taiwan succeeded in growing as an innovation hub in semiconductors, propelling it to high-income status?

On the other hand, what has been the role of the Korean Advanced Institute of Science and Technology (KAIST) in developing Korea's silicon edge? Besides, despite the advancement of Malaysia in building world-class universities and progress in the global innovation ranking, what has been Malaysia's progress in adding value through innovation in its flagship semiconductor industry? Such realities raise some critical questions

IS AMERICA'S SUCCESS IN LEVERAGING RESEARCH UNIVERSITIES REPLICABLE FOR LESS DEVELOPED COUNTRIES?: Before 1920, most top research universities in the USA were busy teaching the knowledge and technology of Europe. It all changed during WW II due to the offering of massive research and development contracts to a few universities, turning them into research universities. The purpose of those research was to advance science and technology for improved defence build-up, leading to the development of nuclear bombs. After the war ended, based on the report submitted by Vannevar Bush, the White House pursued the policy of military mission-led dual use of technology and innovation programmes, fueled by the basic research of universities. Consequently, many graduate students and faculty members engaged in those research assignments opted for entrepreneurship, creating new dimensions of universities like patenting, technology transfer, incubation centres, and startups.

As a result, America was blessed with new high-paying jobs, firms offering technology innovation, and well-known technology clusters like Route 128 in the East and Silicon Valley in the West. However, all the inventions and innovations the newly formed research universities's pin-offs provided failed to serve the civilian markets as they emerged in an embryonic form. The military was the customer in most cases, starting from computers to microchips. Hence, the US government had to form some laws and leverage international treaties like NATO to create a market for those new born technology companies. Without turning the global military into the captive market for research universities' early-stage inventions, America's success in leveraging research universities could have been quite different than we know today.

Unfortunately, America can no longer scale this role of research universities to drive inventions, innovations, and economic growth. Hence, over the last 70 years, the USA has lost epicentres of many inventions. The loss of the epicentre of silicon processing from Silicon Valley to Taiwan has been the recent causality, compelling the USA to come up with fire-fighting measures like the Science and Chip Act. Therefore, a vital question arises: Can less developed countries drive prosperity by following America's footsteps and investing in research universities? Does it mean that less developed countries should not pursue research universities? Of course, they should.

The challenge of the next wave of growth in less developed countries is the economic value of locally produced knowledge and ideas. For sure, research universities are indispensable for creating that flow. However, that flow should outperform global competition, even meeting the local demand. Hence, lessons should be drawn and adapted within the local contexts. Among many others, the journey of Japan's Sony, Taiwan's ITRI and TSMC, and Korea's KAIST could be worth investigating. Unlike firms of America and less developed countries, they focused on creating highly profitable businesses from knowledge and idea production to serve the civilian markets by outperforming the global race. For example, Sony licensed semiconductor technology from the USA's Bell Labs. However, instead of serving the defence market the way American firms did and making copies of the licensed technology as most less developed countries do, Sony focused on refining it to reinvent existing products. Sony's approach led to the developing of highly profitable business by migrating epicentres of several American and European inventions and winning a Nobel Prize by one of its engineers. On the other hand, as opposed to conducting research for publications and demonstrating new technologies, Taiwan's ITRI focused on technology assimilation and refinement and fostering spin-off, leading to developing high-performing TSMC. Besides, instead of competing in graduate and publication production, KAIST concentrates on assessing and refining licensed technologies, resulting in Samsung and a few other success stories.

Before investing in research universities by following the footsteps of the USA and a few other advanced countries, the journey should begin with understanding wealth creation dynamics from ideating, inventing, scaling inventions, reinventing, and winning the global race of offering better products at less cost while causing less harm. Once we educate a critical mass about the basic knowledge of wealth creation dynamics from knowledge & idea production and demonstrate how it works through the partnership between universities, individual producers, and firms, a profit-making competition of developing research universities for creating the flow of ideas will surface naturally.

M. Rokonuzzaman, Ph.D is academic, and researcher

on technology, innovation, and policy. [email protected]