Information Disclosure and the Economics of Science and Technology

Abstract

This paper takes an information-theoretic approach to the economics of science, extending Arrow's pioneering (1962) analysis of the allocation of resources for industrial research and invention. It addresses the questions: is there a valid economic distinction between scientific and technological research, and if there is, what implications may this have for public policy? A brief review points to deficiencies in several of the criteria proposed for distinguishing "scientific" from "technological" research, such as the degree of generality, abstractness, or practicality of the knowledge sought, or the source of the financial support. We suggest a primary differentiation arises between science and technology conceived as social constructions, and is manifested in the greater urgency shown by the "scientific" community towards the disclosure of newly acquired information. Scientists, qua scientists, may be thought to be devoted to the growth of the stock of knowledge as a public consumption good, whereas the technological community is concerned with the flow of rents that private parties derive from discoveries and inventions. The role of priority as a basis for allocating rewards among scientists, its compatibility with the norm of disclosure, and the ambiguous status of patent systems, are reconsidered from this perspective. Certain ineluctable conflicts between the goals of the two research communities point to the persisting economic need for public subsidies to sustain the scientific attitude.