The growing share of university research funded by industry has sparked concerns that academics will sacrifice traditional scholarly activities to pursue commercial goals. To investigate this concern, I examine the influence of an applied sponsor and consider limitations of the grant funding...

We reconsider the justifications of R&D subsidies by Spencer and Brander (1983) and others by allowing firms to pool R&D investments and license innovations. In equilibrium R&D joint ventures are formed and licensing occurs in a way that eliminates the strategic benefits of R&D investment in the...