Research Funding and Productivity at Universities: Studies on Earmarking, Set-Aside Programs

University Of Illinois At Chicago, Chicago IL

Investigators

Abstract

Basic research is an activity whose social benefits exceed private benefits, thereby justifying financial support by the federal government. Today, at least ten federal agencies play a significant role in funding research at U.S. universities, representing, on average, more than 60 percent of total research expenditures. Although this percentage has not changed significantly in the last 20 years, the distribution of federal research funding to universities that have historically received low levels of funding has increased substantially. Federal funding is allocated via peer-reviewed and competitive processes as well as through processes that may not utilize as rigorous analysis of the quality of the research to be undertaken. Two such processes are known as earmarking and set-aside programs. These processes have different effects on both the types of research conducted and the distribution of funding across universities. This project will explore the effect of earmarking and set-aside programs on the distribution of federal research funding across universities and on research productivity. This is an important area to study for two primary reasons. First, research and development is considered an important contributor to economic growth. Thus, understanding the role the federal government plays to promote R&D both nationally and regionally needs further exploration to understand the benefits and costs of federal R&D funding. Second, given universities must allocate scarce resources across research, instructional, and other activities, it is important to understand the impact of the different avenues for obtaining federal funding on the research produced by the university, as well as the role of research funding in the distribution of other forms of revenue. A theoretical framework will be developed that will explore the motivations of universities to seek earmarked funding instead of (or as a complement to) funding allocated under a more competitive process as well as the motivations of Congress to allocate funding via earmarks. Using this framework, the distribution of earmarked funding across universities between 1980 and the present will be explored empirically to discern which of the theoretical predictions are supported by the data. Next, the effect of earmarked funding, alone and in conjunction with total federal research funding, on research productivity will be explored. With respect to set-aside programs, the research will focus on those universities that have benefited from these programs. Whether and how the research productivity of these universities has changed as a result will be explored. Implicit in the project is the development of a framework that explores several complex relationships and the development of an extensive data set. This project will involve a research assistant to help in all aspects of the research. In addition, the assistant will be supervised in an independent research project by the principal investigator, especially with respect to helping to develop high quality research skills.