Shaping Science and Technology Policy: The Next Generation of Research

7. Earmarks and EPSCoR: Shaping the Distribution, Quality, and Quantity of University Research

Introduction Since World War II, the U.S. federal government has played an important role in funding university research. Federal funding represents, on average, more than 60 percent of total research funding used by universities . Congress and the federal agencies, through the research programs and funding levels they support, play a critical role in shaping academic research. To minimize the role played by politics in shaping the distribution of funding and to promote the funding of the best projects, most agencies have adopted a peer-review process for distributing research funds to universities (see Chubin and Hackett 1990). Peer review attempts to elicit information from researchers engaged in similar research about the quality of the projects for which funding is sought. Despite the interest in strengthening economic development through R&D, between World War II and the early 1980s the federal government rarely addressed issues surrounding which universities would receive federal funds. As a result, by the late 1970s, most federal R&D funding was distributed to a few universities located within a few 149 7 Earmarks and EPSCoR Shaping the Distribution, Quality, and Quantity of University Research .   states. In 1978, for example, half of federal R&D funds allocated to universities was distributed to just six states and 80 percent to eighteen states.1 This high concentration of R&D funding attracted critics who accused the peer-review process of fostering an “old-boys” network in which the universities that historically received research funding continued to do so, regardless of the quality of proposals (see Lambright 2000). Another criticism of the high concentration of funding argues that without sufficient R&D funding, state or regional economic development is constrained. Given these concerns, politicians and universities have struggled with how, given limited resources, to reduce the concentration of funding while still promoting quality research. This chapter explores the distribution of R&D funds across universities and how two types of funding schemes initiated in the early 1980s have shaped the distribution of federal funding and university research activities. The first type, not a formal program as such, is known as earmarking. The earmark, contained in federal budget documents that must be approved by Congress and the president, usually specifies a designated amount be allocated to a particular university. Universities use earmarks for a variety of research-related (and nonresearch) purposes . The second program targets universities in states that have historically received low levels of funding. Created by the National Science Foundation, the Experimental Program to Stimulate Competitive Research (EPSCoR) sets aside competitive grants designed to help build the infrastructure needed for such universities to compete effectively in the general grant programs. Because of EPSCoR’s perceived success, most of the agencies responsible for distributing federal research funding have adopted similar programs. The chapter addresses three questions. First, do more universities receive research funding? Given the historical development of research universities, it is very difficult for them to improve their comparative levels of research funding and research activities. Earmarks and setaside programs are one way to affect the distribution of research funding across universities. Second, given that fully evaluating the quality of research proposals requires substantial technical knowledge, earmarks and set-aside programs may not fund high-quality research. Do these programs result in a lower quality of research activity at the universities funded? Third, given that set-aside programs attempt to create an    environment in which proposed research is more fully evaluated and to give incentives to states to promote areas of research in which they show some strength, are set-aside programs more successful than earmarks in promoting quality research? Using data from 1978 to 1998 (1980 to 1998 with respect to earmarks ), this chapter examines how earmarked funding and set-aside programs shape the distribution of funding at universities and research activity there. During this period the federal government earmarked on average $3.6 million (all dollars reported as real dollars, using 1996 as the base year) in R&D related funds per university. Average federal research funding to universities located in a state qualified for EPSCoR was $16 million per university. Average federal research funding to universities not located in a state qualified for the set-aside program was $39 million. The results suggest the distribution of research funding across research and doctoral universities has changed modestly, especially since 1990. In general, average funding per university increased at a slightly faster rate at universities not classified as Research I institutions. Institutions eligible to participate in the EPSCoR program also...