A recent interview (only one free article a month) at The American Interest with Peter Thiel caught my eye. The interview takes up the idea that there has been a stagnation of innovation since the 1960s, other than in IT and banking. A reason for this, Thiel argues, is that so much of the landscape is regulated to the point that only large, expensive efforts can do what used to be done with much more modest investments. The Economist once quipped that the more red tape, the less developed the society.
Yet the urge to regulate runs deep. I was reading about the Dodd-Frank legislation, which runs to over 800 pages, with plenty to be filled in by regulations, many of which remain unwritten. The effort to regulate gets buried in endless procedures, document-production, approvals, and record-keeping, as if these are the primary outputs of industry. Certainly there are ways to regulate that do not merely make work for lawyers and auditors, but to do that, one would have to allow individuals to exercise judgment or have a plan. Having clear rules is one thing. Having a huge apparatus to oversee the rules because the rules themselves are so convoluted, so problematic, so skew from practice and what’s possible is another thing entirely.
One can see this all happening in university IP policies. The IP policies that Archie Palmer reproduces from c. 65 years ago are short–a page or two. The policies state what they need to state, and the rest is for judgment. Now the IP policies run many pages, full of paragraphs of utter nonsense (such as those that I’ve pointed out at Washington and Arkansas–but they are by no means alone). It takes an expert to sort through a university IP policy, and for the most part, an expert will give up in despair and just try to make do.
Thiel looks at the productivity of DARPA and what has happen since its hey-day:
You can’t just write checks to the thirty smartest scientists in the United States. Instead there are bureaucratic processes, and I think the politicization of science—where a lot of scientists have to write grant applications, be subject to peer review, and have to get all these people to buy in—all this has been toxic, because the skills that make a great scientist and the skills that make a great politician are radically different. There are very few people who are both great scientists and great politicians. So a conservative account of what happened with science in the 20th century is that we had a decentralized, non-governmental approach all the way through the 1930s and early 1940s. At that point, the government could accelerate and push things tremendously, but only at the price of politicizing it over a series of decades. Today we have a hundred times more scientists than we did in 1920, but their productivity per capita is less that it used to be.
If we want to look for a factor influencing the apparent stagnation generally in technology development, and in university technology transfer in particular, it may be that the rational, orderly, comprehensive university IP regulatory environment has something to do with it.
There are alternatives. The University of Waterloo does just fine with a finders-keepers model. The only thing odd about it now is that with so many institutions aiming to impose a regulatory environment, Waterloo looks like an exception rather than how things used to be at most universities before things were “improved” by regulation and policy.
In research, in particular, if there is little room for individual insight, then as a society, we must not expect much from our explorations and inquiries. We must expect things to happen because we have regulated them until they are all proper. How can we tell if something is “proper”? Thiel considers the Solyndra default:
The worse explanation—the one I believe is true—is that no one at a senior level in the Administration even thinks about the question of technology. It’s assumed to be a statistical, probabilistic thing that’s best figured out by portfolio allocations of capital to different researchers, and not a worthwhile subject to think about.
I wonder if that is also true at the level of university administration. As long as grants come in, whatever works is fine. There’s no particular plan. Research as an industry. It is someone else’s problem to shape a broad scheme. Regulation makes sure that whatever happens, happens properly–and it’s all fine if nothing much actually happens. It boils down to the university auditor who believes that if something happens one way, it should happen that way forever, and the university attorney who figures that it would be even better if it never happened at all. One wonders who has the real power over innovation in an institution.
Perhaps we have got closer to the source of stagnation in university research innovation. Perhaps it is not the tech transfer office, but rather the regulatory scheme by which university inventors and tech transfer offices are required to do things “properly”.