News from the IPL
INTRODUCTION
This newsletter is published by The Innovation Policy Lab at the Munk School of Global Affairs, University of Toronto, and sponsored by the Ministry of Research and Innovation. The views and ideas expressed in this newsletter do not necessarily reflect the views and policies of the Ontario Government.
ANNOUNCEMENTS
Deja Vue All Over Again? CANARIE and BCNET Help Break Another Global Record for Data Transfer
At the SuperComputing Conference in Salt Lake City, Utah, November 12-16, 2012, a team of high-energy physicists led by the California Institute of Technology (Caltech), University of Victoria and University of Michigan brought a powerful combination of intelligence and technology together and succeeded in almost doubling the record for data transfer, which had been set at 186 Gbps in November 2011. The team reached a record transfer rate of 339 Gbps between Caltech, the University of Victoria Computing Center in British Columbia, the University of Michigan, and the Salt Palace Convention Center in Utah. This nearly doubled last year’s overall record, and eclipsed the record for a bidirectional transfer on a single link with a data flow of 187 Gbps between Victoria and Salt Lake. As with the previous record-breaking data transfer, CANARIE provided the backbone ultra-high-speed fibre-optic network connection between Canada and the United States, while BCNET provided the connection from the University of Victoria in British Columbia to CANARIE.
Canadian Business Ill-Prepared for Era of Big Data
Canadian businesses are at risk of falling behind international competitors in the era of Big Data. A recent survey conducted by IDC Canada and commissioned by SAS, has found that while 96 per cent of Canadian companies say the ability to process and act on data in real time is important, less than half (48%) have invested in the technologies to do so. The survey further finds Canadian companies are late and slow in adoption of technology capable of processing Big Data, and strategic data decision making is being relegated to mid-level IT managers, rather than being viewed by the C-suite as a critical matter. By contrast, international companies are more likely to trust these decisions to the CIO and CFO, have a longer Big Data technology adoption track record and more defined plans for adoption in the near future of these technologies that are assisting organizations become more innovative and productive.
Calls Increase for a National Innovation Agency
Two organizations have in recent weeks called on the United States to create a national federal office of innovation to help focus and concentrate innovation across the country. Following the election, the Information Technology and Innovation Foundation (ITIF) announced its policy recommendations for the administration in their weekly news publication as part of their “Winning the Race 2012” series. Among other recommendations to improve the country’s competitiveness, innovation, and productivity, ITIF calls for the creation of a National Innovation Foundation. Similar in scope and organization to the National Science Foundation, the National Innovation Foundation would support companies and other organizations in innovation activities. Similarly, the OECD in a late November policy paper recommended establishing a national innovation agency, specifically, along with the proposed National Network for Manufacturing Innovation, within the National Institute of Standards and Technology. Both the ITIF and the OECD note that many other countries with “advanced economies” have an agency that consolidates and coordinates a national innovation policy. Instead, the United States’ innovation policy is spread throughout White House offices and Department of Commerce agencies. With the approach of the so-called “fiscal cliff” and a focus on creating a leaner government, it is unlikely that a new agency or office is realistic. Instead, it may be necessary to scale back the activities of other departments and agencies.
Editor's Pick
Effie Amanatidou, European Foresight Platform (EFP)
As early as 2003, Manchester Science Parks sponsored a workshop that brought together leading players in the Manchester City region to develop a vision of how universities could contribute to the then newly established ‘Knowledge Capital initiative’. This exercise succeeded in many respects. Not only a vision and the respective action plan was jointly agreed and followed, but the knowledge base was also formed for a later vision creation exercise: that of developing an Innovation System in the Manchester City Region by 2015. This report tracks the visioning process and outlines important success factors.
Innovation Policy
Strengthening Innovation in the United States
David Carey, Christopher Hill, and Brian Kahin, OECD
The US innovation system has many strengths, including world class research universities and firms that thrive in innovation-intensive sectors. However, fissures have begun to appear, notably in the areas of human capital development, the patent system and manufacturing activity, while public investments in R&D and research universities are at risk of being curtailed by budget cuts. Revitalizing the dynamism of innovation has become a priority for US policymakers. To this end, it is important that federal and state governments sustain financial support for knowledge creation. The US workforce’s skills will need to be upgraded, especially in STEM fields, and measures taken to provide more favourable framework conditions for developing advanced manufacturing in the United States. While the recent patent reform is a big step in the right direction, patent reform needs to be taken further by ensuring that the legal standards for granting injunctive relief and damages awards for patent infringement reflect realistic business practices and the relative contributions of patented components of complex technologies.
Matthew J. Slaughter, USCIB
America today sits at an economic crossroads, unsure of what path to take to confront its competitiveness challenge of too little economic growth and too few jobs. The good news is there is a future in which America can create millions of good jobs and strengthen its economic growth by seeking opportunities in global markets via international trade and investment. Doing so will require thoughtful U.S. policies that promote U.S. competitiveness and are based on a sound understanding that the success of American companies, and of the U.S. workers they employ, increasingly hinges on their success as globally engaged companies. This report aims to provide that understanding by explaining what American companies must do to succeed in today’s dynamic global economy: an explanation — based on current statistics, academic and policy research, and case studies — of the mindset, goals and methods that create success in innovative, forward-looking companies. The report makes three main points about globally engaged U.S. companies.
A Clarion Call for Competitiveness
Council on Competitiveness
Turbulence. Transition. Transformation. These are the hallmarks of today’s global economy—a debt crisis and recession in much of Europe, a slowdown in the hard-charging economies of China and India, instability in the Middle East, the rising threat of protectionism around the world, and new competitors emerging. In these uncertain times, nations that prepare their people, institutions, and laws to compete in a world economy churning with change will set the stage for future prosperity and growth. Nations that fail to act will fall behind. The global economic horizon is painted with both silver linings and dark clouds. This report identifies key economic challenges, and offers solutions to position America to leverage its strengths and address shortcomings hampering our competitive performance.
Cities, Clusters & Regions
Higher Education in Regional and City Development: Post-Secondary Vocational Education and Training
OECD
Rapid growth of tertiary education is partly due to the expansion of post-secondary vocational education and training (PSV). A well developed post-secondary PSV system and links between universities and VET institutions improve skills and employment opportunities. What is post-secondary PSV and how does it relate to other components of the education system? How do the labour market and globalization trends impact post-secondary PSV? How do OECD countries address the issues of transition, pathways and collaboration in tertiary education? This report is part of the OECD work on Higher Education in Regional and City Development. In the course of the reviews of more than 30 cities and regions, this work identified VET-university linkages as one of the common issues that impact the engagement of tertiary education in socio-economic development across countries.
Reflections on Cluster Policies
Steven Brakman and Charles van Marrewijk, CESinfo
Economic activity tends to cluster. This results in productivity gains. For policy makers this offers an opportunity to formulate and promote policies that foster clustering of economic activity. Paradoxically, although agglomeration rents are often found in empirical research a rationale for cluster policies does not exist. A brief tour through the literature shows that cluster policies face more problems than is often assumed in policy circles. We reflect on the main issues at stake and conclude that, if not carefully applied, cluster policy may do more harm than good.
Statistics & Indicators
Robert D. Atikinson and Luke A. Stewart, ITIF
More than three years on from the end of the Great Recession, only six states have regained employment levels enjoyed prior to the recession, and 17 states are still more than 5 percent below their pre-recession employment levels. As many state economies continue to struggle through the lingering effects of the Great Recession, a question commonly asked is, “What is this seemingly invisible force that prevents the economy from returning to prerecession and especially 1990s growth rates?” In other words, why is it that, despite massive monetary and fiscal stimulus, employment seems locked in a persistent malaise? Some argue that the problem is a lack of consumer demand and that more federal government stimulus spending is the answer. Others argue that it is uncertainty over the massive national debt and that fiscal austerity is the answer. However, one diagnosis that has gone largely unnoticed holds that this invisible force is the decline in the competitiveness of the U.S. economy in the global marketplace. For the United States to be competitive, one key will be to compete more on the basis of innovation and entrepreneurship, and less on cost. With a globalized economy enabling easy access to low-cost production systems in nations like China, India, and Mexico, U.S. competitive advantage will continue to be found in making things and providing traded services that other nations are unable to make or provide as easily or as efficiently. And success in this means, among other things, having a workforce and jobs based on higher skills; strong global connections; dynamic firms, including strong, high-growth startups; industries and individuals embracing digital technologies; and strong capabilities in technological innovation. These keys are the same for state economies and this is why the State New Economy Index focuses on these five areas.
Global MetroMonitor 2012: Slowdown, Recovery, and Interdependence
The Brookings Institution
While the global economic recovery slowed in 2012, the world’s largest metropolitan economies continued to have very different growth experiences. Disparities loom both across major world regions and within them, reflecting differences in metro industrial structure, national growth rates, and metro starting points. This latest report summarizes emerging trends. Additional resources include an interactive map and focus feature on Brazilian metropolitan regions.
Business Dynamics Statistics Briefing: Job Creation, Worker Churning and Wages at Young Businesses
Ewing Marion Kauffman Foundation
The pace of recovery in hiring and job creation since 2008 is stronger in newer firms — those two years old or younger — than in more established companies, according to this report. Despite elevated worker turnover rates, the percentage of hiring based on job creation is much greater at startups than at more mature firms. Four out of every 10 hires at young firms are for newly created jobs, much higher than in older firms, where the ratio fluctuates between 0.25 and 0.33. Further, post-recession, only startups show signs of recovery in the pace of worker churning, which is critical to improving the allocation of employees to jobs and boosting wage growth over workers’ careers. The study showed, however, that churning declined between 1998 and 2010 for all firm ages, with worker turnover as a percent of employment flagging as companies age.
Policy Digest
European Commission
The Europe 2020 strategy is built on the three objectives of smart, sustainable and inclusive growth to be implemented as ‘three mutually reinforcing priorities’. In order to deliver on these goals and provide a response to the economic and financial crisis, it is of utmost importance that all involved actors connect these areas of action, involving all relevant stakeholders, developing synergies and boosting the added-value of public investments. To promote a more resource efficient, greener and more competitive economy it is clear that the way ahead has to include significant innovation: sustainable growth needs to go hand in hand with smart growth in order for the EU and its citizens to reap the full benefits of a switch to the green economy. The Technopolis group has developed a practical guide for the Regional Managing Authorities which will assist them in making optimal use of the EU Structural Funds to address issues of sustainable energy, eco-innovation and eco-system service development as well as incorporate green growth into the Regional Research and Innovation Strategies for smart specialisation (RIS3).
To achieve socio-economic development and create jobs, it is essential to connect sustainable and smart growth, in particular, through the research and innovation strategies for smart specialisation (RIS3). It is also important to find practical solutions to de-coupling economic growth from environmental degradation. Innovation is at the core of the efforts to shift Europe’s economy and society towards a resource efficient and low-carbon future. The promotion of innovation for sustainable growth requires an holistic approach and a long-term perspective across the policy cycle.
National and regional policy-makers are encouraged to lead the development of an ambitious long-term vision of smart and sustainable growth under the research and innovation strategies for smart specialization. the focus on transformative innovation requires the engagement of key stakeholders in all phases from policy design to monitoring and evaluation.
Regional and local perspectives have become more important than ever in fostering sustainable growth. Firstly, regions hold the knowledge about the local innovation systems and have the capacity to mobilize economic actors towards a shared goal. Secondly, they are well positioned to develop a thorough understanding of local natural assets and environmental challenges. There is
no ‘one-size-fits-all’ recipe for the development and implementation of strategies that connect sustainable and smart growth: each region needs to seize its own opportunity within the support for investments that are provided by the EU’s regional policy.
Managing authorities are encouraged to place sustainable growth at the core of their RIS3. they should assess the regional innovation potential and consider investing in the areas of eco-innovation, ecosystem services and sustainable energy, taking into account their specific strengths and weaknesses.
Many of the sustainability challenges are beyond the scope of local, regional or national action. For example, climate change or reconfiguration of resource value chains cannot be tackled within confined boundaries and require collaboration between many stakeholders acting at different levels.
In promoting sustainable growth objectives under the RIS3, regions and member States should:
– Actively seek synergies with existing national and European initiatives; and
– Actively exploit the opportunities for cross-regional and international cooperation.
Eco-innovation can be introduced across economic sectors and has significant potential to drive strategic, cross-sectoral
collaboration. Eco-innovation comes in many forms including novel or improved products, technologies, services, management, organizational structures, institutional arrangements and lifestyle or behavioural changes. The pervasive character of eco-innovation exposes it to many different barriers and challenging policy targets.
Rather than focusing on individual one-off support measures, regions and member States should develop a comprehensive
policy mix to support both the demand and supply of eco-innovation.
Ecosystems are fundamental to all economies and societies and to human wellbeing. Ecosystems provide habitats and natural resources and play a key role in climate change mitigation and adaptation. The innovative use of natural assets is a basis for new sustainable economic activities that contribute to smart specialization and the development of a bio-economy. This approach requires innovative ideas and solutions, which are often based on research and development.
In integrating ecosystem services into RIS3, it is important to take account of sustainable solutions, innovative methods and entrepreneurial ideas that rely on renewable, rather than exhaustible, resources that are available in local ecosystems.
Regions and members States should make the best use of bio-economy principles in promoting local sustainable growth.
Research and innovation in sustainable energy is the key to achieving the EU climate and energy target for 2020 known as the ‘20-20-20’ target, and also the target for 2050 of a 85% – 90% reduction in carbon emissions. The ability to tap into sustainable energy technology developments varies across the EU because of the differences in natural endowments and economic conditions, as well as in the technological capacities of each EU Member State and region. Many Member States and regions have considerable opportunities to benefit from the integration of sustainable energy into their RIS3, which also entails a range of opportunities for economic development through expansion of business and research activities in sustainable energy and thus the creation of new jobs. During the next funding period, according to the Commission’s proposal, all regions will have to invest a significant amount of ERDF funding in sustainable energy. However, not all regions might have the potential to specifically invest ERdF funding in research and innovation for sustainable energy through the RIS3 process. Nevertheless, each Member State and region should aim to capitalize on the funding opportunities in a smart way and invest in advancing its local research, development, innovation and technological capabilities. The Strategic Energy Technology (SET) Plan, as the technology pillar of the EU energy policy, provides the framework for Member States to accelerate the development and roll-out to the market of cost-competitive and sustainable energy technologies.
This report recommends that the member States and regions introduce an efficient policy mix of supply and demand measures to stimulate research and innovation in sustainable energy, and also ensure favourable framework conditions and efficient
governance in this area. Innovative activities can range from state-of-the-art R &D to innovative ideas in construction, mobility, design, energy management and business models.
Events
Berlin, 17-18 January, 2013
After the experiences of uncontrollable natural disasters like Hurricane Sandy, socio-technical misjudgements as unveiled in the nuclear disaster in Fukushima or the controversial negotiations about the sources and consequences of climate change, societal debates increasingly have turned from valuing indeterminacy as an opportunity to perceiving uncertainty as a threat. The world, it seems, lives in a permanent state of emergency. Somewhere between resignation and the belief to control risks, a “new language of preparedness” (Ash Amin) is emerging, and vulnerability and resilience have become keywords in this new language. The aim of this conference is to stimulate cross-disciplinary dialogue among leading experts representing sociology, political science, geography, planning studies and regional economics about the notions, conceptual scope and limitations of resilience. A particular emphasis will be put on the socio-technical, political and discursive construction work that underlies calculations of vulnerability and strategies of enhancing resilience. The conference is co-organized by the HafenCity University Hamburg (HCU) and the Leibniz-Institute for Regional Development and Structural Planning (IRS), and supported by the German Research Foundation (DFG).
Madrid, Spain, 10-12 April, 2013
The Conference aims to encourage dialogue between academics and practitioners to improve innovation policy design, implementation and evaluation. The conference will offer keynote speeches, parallel thematic sessions, roundtable discussions, special activities for young researchers and ample space for all participants to interact. Visits to research and innovation centres both in public and private institutions will be offered after the conference.
Shape and Be Shaped: The Future Dynamics of Regional Development 
Tampere, Finland, 5-8 May, 2013
In the many regions and localities of the world, there is an ever-growing need to find new solutions for the future, as they are increasingly confronted with intertwined sets of ecological, social and economic difficulties as well as new opportunities brought to them by the globalising economy. Indeed, there is a need to work for more balanced and sustainable development and cross the many institutional boundaries that prevent new solutions from being created. What makes all of this a demanding set of policy challenges, is that regions and localities need to find ways to manage their own destiny while being manipulated by many forces. The central idea underpinning the RSA 2013 conference in Tampere is that there is now an urgent need to better to understand how regions and localities can adapt to current challenges and deal with the wicked issues of sustainability by developing new multi-actor governance, policy-making and leadership capacities. The conference offers researchers and workers in local and regional development an opportunity to collectively explore and discuss these key issues from a multitude of perspectives and with different theoretical stand points and with empirical observations from different parts of the world.
16th Uddevalla Symposium 2013: Innovation, High-Growth Entrepreneurship and Regional Development
Kansas City, 13-15 June, 2013
The critical role of innovation and entrepreneurship in regional economic development in terms of productivity and employment growth has been well documented theoretically as well as empirically by researchers in recent decades. The specific mechanisms through which innovation stimulates regional economic development are less well established. It is often assumed that entrepreneurship in the form of new firm formation and the growth of newly established firms plays a critical role, but how, why, when and under what conditions is less clear. Empirical studies show that a limited share of new business ventures have the capacity to rapidly up-scale and to generate substantial new jobs in the regions where they are launched. From the perspective of regional policy makers, this implies that it is critical to understand what regional economic milieus are capable of generating innovations that can be the basis of high-growth entrepreneurship as well as provide the right environment for entrepreneurs to launch entrepreneurial initiatives.Against this background, we seek papers that, in particular, topics related to exploring these themes.
Brighton, UK, 10-12 July, 2013
Europe’s relations with the wider world are continuously undergoing change. The urban and regional significance of these changing relations remains surprisingly poorly understood. The global financial and economic crisis, the dramatic events of late 2010 and 2011 in the Middle East and North Africa, the continuing crisis in Europe, and the global rise of ‘new powers’ are each impacting on how Europe, its citizens, and its cities and regions are connected to the wider world. The 9th European Urban and Regional Studies conference aims to consider a wide range of consequences of these changes as well as other themes relating to European urban and regional change.
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This newsletter is prepared by Jen Nelles.
Project manager is David A. Wolfe.