Research On The Industry-university Collaboration Based On Common Agency Theory

The level of effort of the R&D team considerably determines theoutcome of the project, and the success of the collaboration. However,present research on this topic is inadequate. Therefore, this paperanalyzed the relationship among university, enterprise and the R&Dteam in the collaboration, and established mathematical model on theincentive mechanism based on common agency theory.This thesis presumes the signing and execution of contracts inindustry-university collaboration as a common agency problem. Whilethe Principles are university and enterprise, and the agent is R&D team.Then, the optimization of incentive contract, and maximization ofrespective profit in the game, is the most important problem up to thesurface.Considering this situation, this thesis established three mathematicalmodels: sequential model, cooperative model, as well as the exclusiveagent model, in which the university rejects cooperation with theenterprise, and the contract with the R&D team is signed with either ofthem. This thesis also provided the analytical solutions of the models, andconclusion was proposed.The author discovered because of the informational asymmetry, it isdifficult to “measure” the effort level of the R&D team for the universityand enterprise. Consequently, the incentive cost is inevitable in theindustry-university collaboration, which stands for the loss of totalwelfare. This loss is positive related with the risk of outcome, as well asthe risk aversion level of the R&D team. The fixed payment only affectsthe distribution of total income among the university, enterprise and R&D team, and does not affect the effort level of the R&D team. In addition,the author discusses the relationships between the optimal share ratio (oftotal income) and the risk of output, the unit cost of effort, the degree ofrisk aversion of the R&D team, as well as the productivity. Theenterprise prefers offering a fixed payment contract, especially while theproject is too risky.