State Disinvestment in Higher Education: The Impact on Public Universities’ Patent Applications State Disinvestment in Higher Education: The Impact on Public Universities’ Patent Applications

By Bo Zhao

As states reduce funding for public universities in order to close budget gaps, what impact do these cuts have on the schools’ research productivity? This paper measures research output as the number of patent applications filed by public universities and approved by the U.S Patent and Trademark Office. To the best of the author’s knowledge, it is the first to study the role that state appropriations play in public universities’ patent production. The findings suggest that changes in state funding affect the number of approved patent applications from the schools; they indicate that reductions in state appropriations—what scholars and the popular press refer to as “state disinvestment in high education”—lead to fewer approved patent applications from public universities. In exploring the channels through which state appropriations may affect public universities’ research productivity, the author finds that state funding cuts prompt schools to reduce their research expenditures, especially the wages and salaries paid to research staff.

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