Who performs basic research?
Private industry conducts less than 20 percent of the nation’s basic research. In fact, says Hill, if funding for basic research was left to private industry, it would be under-funded. That’s because, Hill writes, “industry perspectives are too narrow, and firms will have a difficult time appropriating commercial value from basic research findings.” For most private firms, appropriating commercial value from activities — in other words, achieving returns on investment — is critical. Basic research has its benefits, to be sure, but they can be long-term in nature, diffuse, and difficult to predict, Hill writes — not the kind of benefits commercial firms profit from. That’s why government support for basic research at universities is critical. “Because of spillovers and an inability to appropriate commercial value from research findings, societies will underinvest in basic research unless it is supported by the government,” Hill writes. Universities are better suited to basic research
