Phil McNaull, director of finance at the University of Edinburgh and chair of the British Universities Finance Directors Group, says that “it has been clear for some time” that direct income for research “does not cover the full economic cost of conducting it, and the net deficit is subsidised by other sources”, such as surpluses from teaching.
Quoted in THE, (emphasis mine). Factually, this is true. It is a mistake to believe that the price of things, equates to how much they cost to produce. Look at the differential pricing of home and non-EU students, for instance. Or the gap between the component parts of an iPhone and the retail price. Or why most successful drugs only cost a fraction of what pharma claims is the cost of development. But the possibilities for some sort of arbitrage are there. And in an area in which agents make up their own standards (i.e. higher education), I think a lot more scrutiny is required.
Patents or graduates? I guess the latter are worth more.