Theories of the firm: The relationship between university technology transfer and new venture creation

This study examined theories of the firm in the context of new venture creation as a way of commercializing university technologies. When technologies created through basic and applied research by university researchers are transferred to the private sector, it occurs mainly through licensing to existing firms or new venture creation. To explain the probability of new venture creation over licensing to existing firms, three models have been constructed based on the three theories in organizational economics: transaction cost economics (TCE), resource-based theory of the firm (RBT) and real options theory (ROP). The moderating effects of external variables surrounding technology transfer, such as the scope and continuity of technology, personal traits of entrepreneurs, and institutional pressures based on extant entrepreneurship literature have also been taken into consideration in these models.; A questionnaire survey has been delivered on-line to the inventors in US research universities. Based on the logistic regression analysis of the data obtained through this survey, it was found out that the resource-based theory of the firm has the largest explanatory power among three theoretical models. As a single variable, the technology inimitability has the largest and positive effect on the probability of new venture creation. This variable was initially included in the transaction cost economics model, the direction of the effect was opposite to the one predicted in transaction cost economics. This result suggests that inventors perceived technology inimitability not as an anti-opportunism attribute of their technology, but rather as a source of sustainable competitive advantage in the context of resource based view of the firm.