TTOs rent extraction and monetization of university research make them locus of corporatization

[Christopher J. Jr., et al. "The Hidden Cost of University Patents." Berkeley Business Law Journal, vol. 21, no. 1, 2024, pp. 203-249. HeinOnline -tm]

But, alternatively defined, and in a Coasean sense, "markets" may mean the contracting that firms engage in-specifically to avoid having to bear the cost of vertical integration, where the latter may exceed the transaction cost of entering into contracts with outside parties. Here, universities, while broadly purposed, regularly enter into contracts with intermediaries, especially in the intellectual property sector. And this is because the cost of production of their intellectual property output exceeds the cost of contracting with intermediaries.101 This contracting function is the raison d'etre of technology transfer offices.

In a particular way, university technology transfer offices are associated with a quantification and monetization of university research. Their existence is justified by revenue generation from university research, which they derived from contracting with licensees. But, as discussed above, few technology transfer offices are actually profit centers. Most are revenue neutral or cost the university internally. Yet, technology transfer offices are the locus of the corporatization of the university because they must respond to market imperatives for revenue generation. Often, they do this by extracting appropriable rents.102