DeSci & incentive imbalances - How DeSci can solve incentive imbalances in funding and scientific research

National Review calls the problem “the increasing bureaucratization of the scientific enterprise.” When researchers lose an average of 44.3% of their time to bureaucratic compliance, the science itself suffers. Applying for funding, managing the funds, and adhering to rules and regulations imposed by the funding body, whether that be the government, VCs, or private industry, takes way too much time and energy.

The limited federal funding available by applying for grants also creates extremely tough competition for scientists who spend their time honing skills to market their ideas rather than conducting research. And when many grants are limited to a few years of funding, important discoveries only achieved through long-term research projects are disincentivized. Not only do projects get overlooked, scientists themselves build their reputations on their ability to attract funding rather than on the quality of their research.

Industry funding bias

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There’s also a problem with funding bias that can result in biased research results. The Scientific American says, “decisions about how to study something are constrained through and through by the expectations of others, by institutional review boards, by funders and by journals.” When it’s not regulations from federal agencies, it may be confirmation bias in industry funded research.

One example of funding bias is in drug trials comparing a drug made by two competing companies. The results showed that in trials sponsored by the newer drug, 79% of the cases drew favorable conclusions for the sponsored drug. In studies sponsored by the older drug, only 13% endorsed the newer drug. Funding bias can cause skewed results in many ways from slanted questions to unrepresentative study populations to imprecise data analysis.

It’s also true that academic journals can cause biased research because negative results are less likely to be published. And since scientists’ credibility is built by the number of articles they publish, which also influences their ability to gain funding, getting published can create a competing incentive with getting accurate results.

DeSci is working to rectify the incentive imbalances in scientific research and funding bias by disintermediating the process. With peer-to-peer networks like blockchain, it’s much easier for scientists to find others whose curiosity aligns with theirs and transact directly. Smart contracts can reduce the amount of bureaucracy needed by automatically executing fund transfers and verifying contract parameters and compliance.

Crypto culture is generally in favor of removing government from unnecessary transactions — that’s why Bitcoin was created — and DeSci falls comfortably in line with that philosophy. Without the need to appeal to the government for research grants, more scientists can tackle more research projects.

For industry funding bias, tokenization can allow different types of fundraising like crowdfunding that doesn’t rely on companies with a stake in the outcome. It can also make the research methods themselves more transparent than they currently are.

Doing the research

It’s not just getting the initial funding that creates bureaucratic impediments. Research and experimentation itself becomes slow because of the same imposed regulations and constraints. The academic journal publishing process is convoluted, requiring peer review and causing publishing lag time that can significantly delay scientific research results.

Because academics review papers as a duty and not as a market transaction they benefit from, this can decrease the quality and thoroughness of their review, creating a feedback loop of incentive imbalances that diminishes the quality of published papers. There’s also a higher risk of plagiarism slipping through when peer review is not meticulous.

One thing that COVID-19 showed us is, in an emergency, producing scientific results doesn’t have to be as complicated as the normal system requires. Research can get done quickly and directly between collaborating researchers without so many bottlenecks for funding, experimentation, and sharing results.

A negative side effect of the openness and speed COVID research brought was a decreased public trust in research results. Blockchain and DeSci can help alleviate these problems by making the research transparent without sacrificing credibility.

On a blockchain, tokenized intellectual property can be documented and verified, yet also shared freely. Scientists can collaborate without risking the security of their intellectual property and guarding against plagiarism. They can also remain anonymous, when it’s necessary, by tokenizing data and having their work reviewed in an unbiased way.

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Rebuilding the research economy with DeSci

Most people inside and outside academia understand there are too many complicated incentive imbalances in the current system for conducting scientific research. Even if you were to ask a random person on the street, it’s likely they would have some skepticism about how research is affected by funding bias and bureaucracy. DeSci, like so many other crypto sectors, is working to decentralize and rebuild a better model for an old system using new crypto technologies that can bring much needed transparency. In part three of the DeSci series we’ll talk about restricted access to information in the scientific community — stay tuned!