Contractual arrangements under technological uncertainty: Analysis of pharmaceutical and biotechnology collaborations

Persistent Link:
http://hdl.handle.net/10150/280007
Title:
Contractual arrangements under technological uncertainty: Analysis of pharmaceutical and biotechnology collaborations
Author:
Hansen, Zeynep
Issue Date:
2002
Publisher:
The University of Arizona.
Rights:
Copyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.
Abstract:
This dissertation investigates the conditions that shape the governance structure of contractual agreements and how different contract types address the potential problems that can arise in R&D partnerships under technological uncertainty. The motivation for this study arises from the emergence of new forms of R&D organization to cope with challenges as well as opportunities created by rapid technological change. This dissertation demonstrates the significance of technological uncertainty in determining the observed variety of contractual arrangements in the biotechnology industry. It also shows that the returns from collaborative arrangements as measured by the number of successful patents differ among various contract types. The first part of this research focuses on biotechnology alliances with pharmaceutical companies involving drug discovery research. It demonstrates how advances in technology affect the structure of R&D contracts. Using contractual data over time, it is shown that newer technologies associated with higher uncertainty result in the choice of more equity participation by the pharmaceutical partner and more hierarchical contractual arrangements. This result supports the transaction cost arguments that as contractual difficulties arise, allying firms are more likely to choose a more hierarchical governance form over simpler arrangements. The second part of the dissertation investigates the significance of external R&D investments by large pharmaceutical companies to their overall innovation process. The performance of collaborations on the overall R&D productivity are evaluated in terms of their impact on successful patent production. This study measures the innovative returns to R&D collaborations separate from in-house R&D resources and possible knowledge spillovers. Using a panel data set of large pharmaceutical companies, a knowledge production function is estimated. The results indicate that the implied long-run elasticity of successful patent output with respect to all active R&D alliances is lower than the elasticity estimate with respect to in-house R&D investments. In addition, marginal returns to R&D collaborations differ among various contractual types, in terms of their contribution to patent production process. It is also shown that knowledge spillovers by competitors contribute to patent production, but scientific publications hinder it.
Type:
text; Dissertation-Reproduction (electronic)
Keywords:
Economics, General.; Economics, Commerce-Business.
Degree Name:
Ph.D.
Degree Level:
doctoral
Degree Program:
Graduate College; Economics
Degree Grantor:
University of Arizona
Advisor:
Libecap, Gary D.

Full metadata record

DC FieldValue Language
dc.language.isoen_USen_US
dc.titleContractual arrangements under technological uncertainty: Analysis of pharmaceutical and biotechnology collaborationsen_US
dc.creatorHansen, Zeynepen_US
dc.contributor.authorHansen, Zeynepen_US
dc.date.issued2002en_US
dc.publisherThe University of Arizona.en_US
dc.rightsCopyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.en_US
dc.description.abstractThis dissertation investigates the conditions that shape the governance structure of contractual agreements and how different contract types address the potential problems that can arise in R&D partnerships under technological uncertainty. The motivation for this study arises from the emergence of new forms of R&D organization to cope with challenges as well as opportunities created by rapid technological change. This dissertation demonstrates the significance of technological uncertainty in determining the observed variety of contractual arrangements in the biotechnology industry. It also shows that the returns from collaborative arrangements as measured by the number of successful patents differ among various contract types. The first part of this research focuses on biotechnology alliances with pharmaceutical companies involving drug discovery research. It demonstrates how advances in technology affect the structure of R&D contracts. Using contractual data over time, it is shown that newer technologies associated with higher uncertainty result in the choice of more equity participation by the pharmaceutical partner and more hierarchical contractual arrangements. This result supports the transaction cost arguments that as contractual difficulties arise, allying firms are more likely to choose a more hierarchical governance form over simpler arrangements. The second part of the dissertation investigates the significance of external R&D investments by large pharmaceutical companies to their overall innovation process. The performance of collaborations on the overall R&D productivity are evaluated in terms of their impact on successful patent production. This study measures the innovative returns to R&D collaborations separate from in-house R&D resources and possible knowledge spillovers. Using a panel data set of large pharmaceutical companies, a knowledge production function is estimated. The results indicate that the implied long-run elasticity of successful patent output with respect to all active R&D alliances is lower than the elasticity estimate with respect to in-house R&D investments. In addition, marginal returns to R&D collaborations differ among various contractual types, in terms of their contribution to patent production process. It is also shown that knowledge spillovers by competitors contribute to patent production, but scientific publications hinder it.en_US
dc.typetexten_US
dc.typeDissertation-Reproduction (electronic)en_US
dc.subjectEconomics, General.en_US
dc.subjectEconomics, Commerce-Business.en_US
thesis.degree.namePh.D.en_US
thesis.degree.leveldoctoralen_US
thesis.degree.disciplineGraduate Collegeen_US
thesis.degree.disciplineEconomicsen_US
thesis.degree.grantorUniversity of Arizonaen_US
dc.contributor.advisorLibecap, Gary D.en_US
dc.identifier.proquest3053871en_US
dc.identifier.bibrecord.b42811673en_US
All Items in UA Campus Repository are protected by copyright, with all rights reserved, unless otherwise indicated.