Universities and the Knowledge-Based Economy

Hsu Wen-hsing, the founder of Startek Engineering, was the first person in Taiwan to research a system for entering hand-written Chinese characters into a computer. Back when he was earning a doctorate at Keio University in Japan, he chose this as the topic for his doctoral research. Right after his doctorate was published, a Japanese company with vision purchased the rights to his patent and began selling a character recognition device based on it for 40 million yen. Hsu's patent, which was based on his original research into optics and imaging techniques, not only allowed a small company with only 35 employees to create a 3.5 billion yen business; it also gave Hsu his first taste of "knowledge wealth."

The goose's newest golden egg

In the knowledge economy, knowledge is the golden egg, and universities are truly treasure troves of knowledge. In 1959, the first American "incubator" was created, for which a university provided equipment and technical consultation. This model for an entrepreneurial incubator would gradually find wide acceptance. In Taiwan incubators of this type started to be created about ten years ago. So far there are 46 incubators connected to universities, colleges and research institutes in Taiwan, which have helped give birth to about 600 different companies. While the numbers may sound impressive, mainland China's Purple Light IT Group, connected to Qinghua University, and Founder Group, connected to Beijing University, have much more impressive records of launching successful companies, and this alarms people here in Taiwan.

"The long and the short of it is that Taiwan's educational and governing systems are too old fashioned and inflexible," says Lin Yao-chin, director of Yuan-Ze University's incubator, which was last year ranked as one of the island's best.

Chen Po-chih, Chairman of the Council for Economic Planning and Development, has relevant first-hand experience. He was a visiting professor at Brown 18 years ago. When he signed a contract with the American university, he was surprised to read a clear explanation of the two parties' rights with regard to patents and intellectual property. At Brown what happens if a professor wants to move from research to industrial applications, or wants to serve as a consultant to industry? No problem. In any case, the university gets a percentage, so that industry, the professors and the universities all benefit.

"It's not like Taiwan, where the professors at national universities, as civil servants, get basically the same amount of money no matter how hard they work." Chen has taken on more than a dozen consulting jobs for the Industrial Technology Research Institute, Ministry of Economics and other government agencies. These involve endless meetings day after day, but all he has gotten in the way of financial reward was a doubled transportation allowance. Furthermore, foreign universities allow professors to leave campus to work for the private sector, and then to return to the university if the venture fails. But because professors in Taiwan don't have this option, they have no choice but to suffer through the required number of years to make their pensions before they can pursue opportunities off campus. In the process of this long wait, even if they have a lot of ambition and come up with a clear vision of how to develop their research, it all usually ends up for naught.

A pass that costs NT$5 million

In 1999 "The Basic Law on Science and Technology" that the Executive Yuan had long been promoting was finally passed by the Legislative Yuan. This law allows academic institutions and g