That’s my guess for this particular effect, and overall, but I have heard plausible arguments that when you add up all the different externalities their collective effect is large, proportionally. For instance, competition for grants diverts a lot of time from good scientists to grantsmanship, and reduces the autonomy of young investigators who might otherwise undertake higher-risk research. Further, it seems plausible that at the margin funding brings in lower-quality scientists who produce less value for the negative externalities they produce. More quantitative data would be very nice for testing these claims.
That’s my guess for this particular effect, and overall, but I have heard plausible arguments that when you add up all the different externalities their collective effect is large, proportionally. For instance, competition for grants diverts a lot of time from good scientists to grantsmanship, and reduces the autonomy of young investigators who might otherwise undertake higher-risk research. Further, it seems plausible that at the margin funding brings in lower-quality scientists who produce less value for the negative externalities they produce. More quantitative data would be very nice for testing these claims.