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January 6, 2006
It was around the mid-1980s that the big shift towards business and wealth took place in government strong and in society. Under a neo-liberal mode of governance it became not only reputable to be wealthy, but something close to virtuous. There were "winners" and there were "losers," and the winners were rich and deserved to be. The losers deserved to be poor.
But how to create winners when Australian capitalists were so second rate and the wealth of the nation was at stake? One answer was technology parks which signified the translation of tax-supported basic research into useful new products---a process sometimes referred to as technology transfer." The strategy of technology transfer was to create Australian entrepreneurs, and to nurture the start up technology companies into Australian-owned high-tech businesses that would then compete in world markets.
It worked like this. In public universities, where most public funded research work is carried out, researchers can now patent and license their discoveries, and charge royalties. They could also enter into deals with drug companies that would directly transfer their public discoveries to industry. This gave a boost to the nascent biotechnology industry, as well as to big pharma. This article gives a good description of the process:
Small biotech companies, many of them founded by university researchers to exploit their discoveries, proliferated rapidly. They now ring the major academic research institutions and often carry out the initial phases of drug development, hoping for lucrative deals with big drug companies that can market the new drugs. Usually both academic researchers and their institutions own equity in the biotechnology companies they are involved with. Thus, when a patent held by a university or a small biotech company is eventually licensed to a big drug company, all parties cash in on the public investment in research.
Academic capitalism it is called. The talk was of cities of knowledge and the model to emulate was Silicon Valley as Australia's neo-liberal policymakers endeavoured to push and shape universities into trying to create new Silicon Valleys.
In this review by Jane Marceau of Margaret Pugh O'Mara's Cities of Knowledge: Cold War Science and the Search for the Next Silicon Valley helpfully spells out the preconditions for the flowering of Silicon Valleys:
Lesson One, she says, is that, to be successful, you need a lot of money. And money follows money....Lesson Two is that you need a very powerful university. Successful cities of knowledge in the United States have strong research universities at their centre...Lesson three is that you need control over land in the right location; in short you need control over the development of large parcels of land in locations desirable to middle class professionals...Lesson Four is that you need to make high tech development the end, not the means. This somewhat more complex lesson suggests that it is only universities that focus totally on creating science research and high tech industries for themselves will succeed.
As Marceau says that in Australia it is hard to see how these prerequisites are to be achieved. Our public universities seldom own large parcels of undeveloped land and most state governments have increasingly divested themselves of their own land banks. Our federal governments have not given out large amounts of money for research. The funds they provide for new science is almost derisory in most fields and more general federal funding for universities has fallen consistently in recent years. And industry gives little money for research in universities in Australia.
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Supposedly UVa has developed a decent biotech industry around it in Charlottesville. That town has room to grow, but MIT in Boston doesnt. Boston is a pretty cramped city.
For money to follow money in Australia, it will have to be defence that hands out the dollars, to private industry and university.
Probably making most of the Universities amalgamate with UNSW was a mistake. Otherwise Universities like Wagga Wagga could leverage the town's large amount of open space to try and create an inland tech haven. It would require the town to be complicit.
But towns and counties get bought off constantly in the US. IIRC that Janelli Park I mentioned in a previous comment, gets a 1 million a year tax break from the county. This is in a county with a 1 billion a year budget and who leverages double digit percentage increases in property taxes on residents each year.