This preview shows page 332 - 334 out of 394 pages.
30 For an overview of the innovation model in pharmaceuticals see Pisano 2002. Biomedical research is typically one of the most R&D-intensive industries, with much of the research focused in areas that are often thought of as basic research because viable products come directly from the frontier of knowledge whereas in other industries (including energy) there is a much longer innovation pipeline and a larger role for devel-opment and demonstration investments. My statement here that private sector research exceeds public sector is based on total research spending (of which 57 percent is private sector); more fine-grained assessments about the private/public breakdown for basic versus applied research are much more difficult to draw because the data are not organized in a way that allow for consistent comparisons. For a careful look at the data see Moses et al. 2005.31 For example, the Bayh–Dole Act of 1980 allows universities and other government-funded researchers to license innovations based on the the-ory that if they have an incentive (licensing fees) they will work harder to get ideas out of the laboratory and into the hands of commercial inves-tors who will take them to the market. (For the biggest universities that theory has worked. Smaller ones, though, have struggled to justify the cost of maintaining the offices, lawyers, and other paraphernalia needed to make Bayh–Dole actually work.) Mowery et al. 2004, p. 241.32 Given these incentives it is not surprising, therefore, that R&D spend-ing for agriculture is highly fragmented. Across the world, total spend-ing on agriculture R&D is roughly evenly divided between the public and private sectors. But about 95 percent of all private sector agricul-ture R&D is done in the industrialized nations and concentrated on crops that earn large private returns. Out of all R&D done in devel-oping countries, only 6 percent was conducted by private firms and they focused on a few cash crops that are generally grown for export such as cotton and sugar. Money is pulsing into agriculture R&D in a few areas just as crops and agricultural activities that are most rel-evant for the world’s least fortunate farmers remain orphans. Places where crops are least lucrative and the institutional elements needed
Notes to Pages 132–134297for private investment are weakest see the lowest share of private sector investment. In sub-Saharan Africa only 1.7 percent of all agriculture R&D comes from private sector resources. Globally, about $34 billion was spent on all forms of agriculture R&D. The entire CGIAR system, which is the main publicly funded mechanism for cooperation on R&D funding in developing countries, spent only about $547 million and is periodically wracked by funding crises since the vast majority of its resources come from governments. (Half of CGIAR’s funding comes from European governments alone; only 2 percent comes directly from foundations.) Broad trends in agriculture R&D spending are from National Science Foundation 2008 as summarized in Pardey and Alston 2010. The CGIAR budget is from CGIAR