News from the IPL
ANNOUNCEMENTS
Dan Breznitz appointed Clifford Clark Visiting Professor at the Department of Finance
University Professor and IPL Co-Director Dan Breznitz has been appointed as the Clifford Clark Visiting Economist at the federal Department of Finance. Professor Breznitz holds the Munk Chair of Innovation Studies at the University of Toronto’s Munk School of Global Affairs & Public Policy and is a professor in the Department of Political Science. He is a CIFAR fellow, where he co-directs the program on Innovation, Equity and the Future of Prosperity. Professor Breznitz is known around the world as an expert on rapid-innovation-based industries and their globalization. His latest book, Innovation in Real Places: Strategies for Prosperity in an Unforgiving World, was chosen by the Financial Times as one of the Best Business Books of 2021 and has been shortlisted for the inaugural Balsillie Prize for Public Policy. The Department of Finance created the Clifford Clark Visiting Economist role in 1983 to bring in fresh outside policy perspectives. The visiting economists work closely with the Deputy Minister and Ministers to share their views and help shape thinking for the future. During his time with the Department of Finance, Dr. Breznitz expects to focus on developing advice centred on economic growth and innovation policy.
EVENTS
Registration Link: https://munkschool-utoronto-ca.zoom.us/webinar/register/7016358721497/WN_GERK97ZUQOqfrclSlfy5ZQ
A webinar link will be emailed to you upon registration.
RESEARCH
Designing Innovation Policy Mixes to Support High Growth Firms
Kieron Flanagan, Steven Denney, Adam Froman, Krista Jones, & David A. Wolfe,
This talk includes a presentation of a paper by IPL researchers Steven Denney, Travis Southin, and David A. Wolfe titled “Picking Winners: How Growth and National Context Shape Scale-up Entrepreneurs’ Assessments of Innovation Policy Mixes.” Despite today’s challenging conditions, Canada continues to identify and support high-growth firms with a view to increasing its market share. High-growth firms not only hire more employees, but they noticeably lead in productivity and innovation—especially in the digital and clean technology sectors. Lately, there has been an increase in unicorn companies and initial public offerings, leaving Canada to build upon this momentum and not lag behind other countries. This event examines what high-growth firms represent to the Canadian economy and why innovation is so difficult to support through government programs. Participants will learn about the barriers that prevent companies from becoming high-growth firms, the potential of program evaluation for identifying the next generation of high-growth firms, and the various ways policy instruments can be improved.
Speakers
- Kieron Flanagan, Professor of Science and Technology Policy, Alliance Manchester Business School – Innovation Management and Policy Division, University of Manchester (pre-recorded interview)
- Steven Denney, Post-Doctoral Fellow, Innovation Policy Lab, Munk School of Global Affairs and Public Policy, University of Toronto (pre-recorded interview)
- Adam Froman, Founder and Chief Executive Officer, Delvinia
- Krista Jones, Founding Executive, Momentum, and Vice President, Venture Services, MaRS Discovery District
- David A. Wolfe, Co-Director, Innovation Policy Lab, Munk School of Global Affairs and Public Policy, and Professor of Political Science, University of Toronto
Moderator
Neil Bouwer, Vice-President, Innovation and Skills Development Branch, Canada School of Public Service
What Silicon Valley Gets Wrong about Innovation
Dan Breznitz
IPL Co-Director Dan Breznitz leads a forum in a new edited volume focused on how local economic development might foster long-term, inclusive prosperity. Dan argues that in today’s world of globally fragmented production and dominating high-tech clusters, efforts to duplicate silicon valley don’t raise all boats. To generate local, inclusive prosperity, cities must think beyond tech accelerators and science parks and instead embrace a wider range of innovation strategies. This forum is part of a new Boston Review book titled Public Purpose: Industrial Policy’s Comeback and Government’s Role in Shared Prosperity. The book’s other forum is led by economist Mariana Mazzucato and articulates an industrial policy agenda organized around ambitious, cross-sector “missions,” designed around important national goals. The authors in this volume collectively argue for “putting public purpose at the center of our politics and policy.” Excerpts from the authors participating in Mariana Mazzucato’s forum are available online here.
Canada as a Learning Economy: Education & Training in an Age of Intelligent Machines Policy Challenges & Policy Responses
Tracey M. White and David A. Wolfe
This SSHRC funded Knowledge Synthesis Report was prepared by U of T Political Science PhD Candidate Tracey White and IPL Co-Director David A. Wolfe. Literature analyzed here illuminates the nature of adult education, learning and skills development and forms of work organization as factors in Canada’s innovation performance. In the World Economic Forum’s 2017-18 Global Competitiveness Survey Canada ranked 23rd on its ‘capacity for innovation’ metric. If this country is to have a prosperous, innovative economy then the skills and ingenuity of its people matter. Skills development opportunities for Canadians beyond the formal pre-career education systems are inadequate to meet the demands of a rapidly digitizing economy. It is increasingly clear that Canada’s fragmented approach to adult education is an impediment to labour market flexibility and social mobility on which the digital economy depends. Canada’s labour market institutions were developed to meet the needs of an industrial economy. The moment has arrived to re-imagine them to support Canada as a learning economy. This report reviews the approach of the Danish innovation system to provide an alternative example. It urges Canadian policymakers to make development of human resources a higher priority by reinvigorating labour market governance arrangements and realigning incentives to meet the needs of a digital economy.
How Stories Shape Regional Development: Collective Narratives and High-Technology Entrepreneurship in Waterloo, Canada
Darius Ornston, IPL Affiliated Faculty
The Waterloo region in Canada has emerged as an unlikely competitor in high-technology markets, challenging theories based on path dependency, population density, anchor firms, and military spending. While theorists and residents attribute the rise of high-technology entrepreneurship to cooperation, evidence of collaboration is sparse. This article resolves this puzzle by explaining how ideas can coordinate action in loosely coupled systems. Dense, cross-cutting civic networks may not have supported task-specific cooperation, but they facilitated the construction and diffusion of collective narratives. Conventionally understood to leverage locational assets, the Waterloo case demonstrates how storytelling can also soften geographic constraints. Success stories inspired entrepreneurs by re-conceptualizing what was possible, peer-to-peer mentoring helped firms to navigate local constraints, and external marketing enabled the region to access resources it could not mobilize internally. By documenting the importance of storytelling as a form of collective action, the Waterloo case illuminates a broader array of strategies available to local change agents and smaller regions.
Editor's Pick
Net Benefit: For Canadian Startups, Not All Exits Are Created Equal
Innovation Economy Council
This report focuses on trends in financing and exits for Canadian Startups. More than 400 companies raised a record $10.9 billion in venture capital deals in the first nine months of 2021. That’s more than in any full year to date, including 2000, the height of the dot-com boom. There has been $8.3 billion in V.C. investment in the first half of 2021, versus $5.9 billion in exits. Based on M&A data from Pitchbook, the authors note that “startups with a majority of Canadian investors are more likely to stay Canadian-owned when they exit.” Of nearly 400 V.C.-backed companies involved in M&As between January 2019, and February 2021, more than half were acquired by foreign investors, with the vast majority based in the U.S. Of those that remained in Canadian hands after being taken over, 71 percent had a majority of original Canadian investors.
Cities & Regions
Spill over or Spill out? – A multilevel analysis of the cluster and firm performance relationship
Nils Grashof, Industry & Innovation
Regional clusters have become an inseparable component of modern economies. Spurred by the idea that clusters unrestrictedly encourage firm innovativeness, the cluster approach has particularly gained attention among politicians. Nevertheless, due to a lack of holistic consideration of different influencing variables, the scientific results about the effect of clusters on firm innovative performance are highly contradictory. Consequently, this paper aims to empirically investigate the conditions through which companies can gain from being located in clusters, focusing thereby particularly on moderating variables that relate to possible knowledge spillovers. Therefore, three different levels of analysis are considered separately and interactively. By analysing a unique multilevel dataset of 11.889 companies in Germany evidence is found that being located in a cluster has a positive impact on firm innovativeness. However, the results also indicate that firms benefit unequally within the cluster environment, depending on the specific firm, cluster and market/industry conditions.
Statistics
Entrepreneurship indicators of Canadian enterprises
Statistics Canada
The entrepreneurship indicators of Canadian enterprises for the 2019 reference period are now available upon request. The Entrepreneurship Indicator Database program provides data that describe the entrepreneurial dynamics of Canadian enterprises. The data include the number of active enterprises with one or more employees, the number of births and deaths of active enterprises with one or more employees, the number of jobs associated with enterprise births and deaths, the survival of newly created enterprises, and the number of high-growth enterprises and gazelles. The program was created to meet the economic challenges associated with entrepreneurship policies in Canada. In 2019, there were 1,143,610 active enterprises in Canada with one or more employees. Of those, 64.6% had four employees or less. In the same year, there were 79,530 births and 90,710 deaths of enterprises. The construction sector represented the largest number of high-growth enterprises by employment and by revenue. With 1,140 high-growth enterprises by employment and 2,530 high-growth enterprises by revenue, this sector accounted for 15.9% and 19.5% of the total, respectively.
Samar Fatima, Gregory S. Dawson, Kevin C. Desouza, and James S. Denford, Brookings Institute
Despite the value of machine learning, much of AI development is still predicated on two pillars: technologies and human capital availability. This report focuses on human capital, using three data elements: Relative Skill Penetration (the prevalence of AI skills for the average occupation in the country), AI Hiring Index (the percentage of LinkedIn members within a given country that had AI skills reflect in their profile), and STEM graduates (the number of graduates with STEM degrees in any given country). The first two data elements were from Stanford’s Human Center Artificial Intelligence work while the STEM graduate information was from the World Bank. The authors conducted a factor analysis to determine if any of the three data elements were closely related. Closely related items were mathematically combined into a single composite factor which contains both data elements to aid in the interpretation of the data.
Innovation Policy
Billion dollar fund to drive low emissions technology investment
Prime Minister, Minister for Industry, Energy and Emissions Reduction, Australia
The Morrison Government will establish a new $1 billion technology fund to turbocharge investment in Australian companies to develop new low emissions technology. The Low Emissions Technology Commercialisation Fund (the Fund) will combine $500 million of new capital for the Clean Energy Finance Corporation (CEFC) with $500 million from private sector investors. Prime Minister Scott Morrison said the Fund would back Australian early stage companies to develop new technology. “Our Plan to reach net zero by 2050 is an Australian one that’s focused on technology not taxes and this Fund backs in Australian companies to find new solutions,” the Prime Minister said.
David Matthews, Science|Business
Mission Innovation, set up in 2015 by Barack Obama and other world leaders, has this year pivoted to a new strategy that sees the countries involved work together on specific climate missions, for example, sucking 100 million metric tons of carbon dioxide out of the atmosphere annually by 2030, some of which were newly unveiled at COP26. Mission Innovation aims to avoid duplication of R&D and get green tech to market sooner. Its targets will provide support for the US/China pledge to accelerate low-carbon transition and climate technology innovation. Collectively the body claims to represent over 90 per cent of the world’s public investment in clean energy innovation.
Policy Digest
COP26: The most important research and innovation announcements
David Matthews, Goda Naujokaitytė and Florin Zubașcu, Science|Business
This article by Science|Business summarizes the top R&D stories as the COP26 conference draws to a close:
Scientific geopolitics
U.S.-China Joint Glasgow Declaration on Enhancing Climate Action in the 2020s
In a surprise move at the end of the conference, Beijing and Washington agreed on the need to cooperate on “climate technology innovation” and in areas like carbon storage and air capture.
US-UK strategic energy dialogue
Originally agreed by Joe Biden and Boris Johnson back in June, COP26 saw the UK and US officially launch a series of regular dialogues to “deepen collaboration” in areas like clean energy technology, nuclear, energy security, and science and innovation.
Clean technology diffusion
The Glasgow Breakthroughs
The goal of the ‘Glasgow Breakthroughs’ is to make clean technologies the cheapest and most accessible option globally across four heavily polluting sectors: power generation, road transport, steel, and agriculture, plus to make clean hydrogen “affordable” and “globally available” by 2030. The US and EU are on board in every sector, but China has only signed up for the hydrogen breakthrough.
Global Energy Alliance for People and Planet
This is a $10 billion initiative to try to create investible renewable energy markets in poorer countries, where currently, because of logistics, infrastructure and financing problems, renewables aren’t competitive with fossil fuels. The hope is that the alliance, backed by the Rockefeller Foundation, the furniture company IKEA, and Jeff Bezos’s Earth Fund, can help governments set up the right policy to support renewables, allowing the private sector to then steam in with billions if not trillions of dollars.
Private sector to the rescue?
Glasgow Financial Alliance for Net Zero
Former Bank of England governor Mark Carney has managed to get more than 450 firms collectively managing over $130 trillion of private capital to commit to “transforming the economy for net zero”.
The First Movers Coalition
Twenty-five of the world’s biggest companies, including Amazon, Apple and Boeing made a series of purchasing commitments to buy green technology in areas that are hard to decarbonise, like road freight, shipping and steel.
Adaptation and agriculture
The Adaptation Research Alliance
A grouping of 90 organisations (mainly aid agencies, but including a handful of universities too) that will focus on research into adaptation and mitigation of the effects of climate change.
Agricultural reform and innovation
The UK government committed to new research spending to try to make agriculture and land use more sustainable. It pledged £38 million for CGIAR, a global agricultural research organisation. There will also be up to £40 million for a new “Global Centre on Biodiversity for Climate”, which will address “critical research gaps” in biodiversity and conservation scholarship.
Transatlantic Collaboration Platform on Agriculture
The EU and the US have diverging views on the use of new technologies such as precision breeding and gene editing, but Brussels and Washington agreed during COP26 to work more closely together on climate change and agriculture, including how science and innovation can make farming more sustainable.
Controversial and emerging tech
The US’s long-term net zero strategy
Speaking at the beginning of COP26, Joe Biden unveiled a new report that sets out exactly how the US will reach net zero by mid-century, and crucially, which technologies will be in the mix. There are repeated mentions of nuclear power, and more speculative tech that can suck carbon from the atmosphere, despite warnings in the very same report that this is currently very far from being ready for wide-scale deployment.
Small modular reactors
The US announced it would build a trial nuclear small modular reactor in Romania to help decarbonise and secure the country’s energy supply. Although the mini reactors are still a relatively unproven technology, they promise to be easier to deploy than conventional reactors, as they can largely be assembled in a factory beforehand. The UK also said it would contribute £210 million towards them.
Links to recent IPL webinars
Canada’s Quantum Internet: Prospects and Perils
This is a recording of the April 20, 2021 webinar that together experts to discuss the political, economic, and scientific implications of quantum communications, for Canada and the world .Speakers: Francesco Bova, Associate Professor, Rotman School of Management, University of Toronto; Anne Broadbent, Associate Professor, Department of Mathematics and Statistics, University of Ottawa; Jon Lindsay, Assistant Professor, Munk School of Global Affairs & Public Policy and Department of Political Science, University of Toronto; Christoph Simon, Professor and Associate Head, Research, Department of Physics and Astronomy, University of Calgary; & Dan Patterson (moderator), Technology Reporter, CBS News
Intellectual Property and Entrepreneurship in Canada
This is a recording of the March 23rd 2021 webinar focused on the importance of IP protection for entrepreneurship, the intellectual property environment in Canada, and existing support for firms. Panelists discussed issues relating to their firm’s ability to secure IP especially as it relates to IP education and the role of government in supporting IP protection. Speakers: Seray Çiçek, Ryan Hubbard, Graeme Moffat, Moderator: Shiri Breznitz
Canada’s future skills strategy: Workforce development for inclusive innovation
This is a recording of the January 19th 2021 webinar discussing the Future Skills Council report, released in November 2020, which recommends equitable and competitive labour market strategies in response to disruptive technological, economic, social and environmental events. It aims to provide a roadmap to a stronger, more resilient future for Canada. In this webinar, panelists discuss the report’s key action areas and pathways to successful implementation. Speakers: Rachel Wernick, Denise Amyot, Dan Munro, & David Ticoll.
Events
Transformative Innovation Policy (TIP) Conference 2022
January 17-21, 2022, Digital Conference
The 2022 Transformative Innovation Policy (TIP) Conference is asking for a wide range of participants from across many disciplines and fields to submit ideas for panels, demonstrations, initiatives, and projects that work towards transformations for sustainability and a just transition. The ‘Call for Initiatives’ is open now until 4 September 2021 and encourage Expressions of Interest (EoI) from a wide set of contributors across research, civil society, business and policy. This is a short extension so please get your EOI in as soon as possible. The theme is “BUILDING A SUSTAINABLE KNOWLEDGE INFRASTRUCTURE ON TRANSFORMATIVE INNOVATION POLICY.” The aim of the sessions is to be a symphony of approaches and collaborations to mix-up the conference dynamic and offer a chance to experiment with building knowledge infrastructures and exchanges across sectors and disciplines to activate transformational system change to solve our Earth crisis. The TIP Conference 2022 is organised and funded by the Transformative Innovation Policy Consortium (TIPC) and the European Forum for Studies of Policies for Research and Innovation (Eu-SPRI) with the participation of Globelics and Africalics members and with the involvement of Sustainability Transitions Research Network (STRN) members.
6th Geography of Innovation Conference
January 26-28, 2022, Bocconi University, Milan
The conference brings together leading scholars on the spatial dimension of innovation processes. It is a forum for interdisciplinary research on this topics, including perspectives from economic geography, innovation economics, and regional science, as well as economics and management science, sociology and network theory, and political and planning sciences.
P4IE 2022 International Conference Measuring Metrics that Matter
May 9-11 2022, Ottawa and Online
How to best design innovation indicators for the future? You are invited to contribute to this challenging question during our second international conference on “Policies, Processes and Practices for Performance of Innovation Ecosystems” (P4IE). The hybrid conference will be held online and in-person at Ottawa. You can actively participate by submitting an academic, industry or public policy paper. Topics includes, but are not limited to: New/Real-time innovation indicators; Sustainable, Inclusive, Responsible (SIR) innovation indicators; Measuring the performance of innovation ecosystems; and Science-to-innovation SIR innovation indicators. Submissions of academic extended abstracts due by December 13, 2021 (acceptance notification by February 15). Submissions of policy papers due by January 14, 2022 (acceptance notification by February 14). Submissions of industrial papers due by February 14, 2022 (acceptance notification by March 14).
Subscriptions & Comments
Please forward this newsletter to anyone you think will find it of value. We look forward to collaborating with you on this initiative. If you would like to comment on, or contribute to, the content, subscribe or unsubscribe, please contact us at ipl.munkschool@utoronto.ca .
This newsletter is prepared by Travis Southin.
Project manager is David A. Wolfe