News from the IPL
The Material Basis of Modern Technologies
February 2, 2023 | 4:00PM - 6:00PM, In-person, 108N North House, Munk School, 1 Devonshire Place, Toronto ON
Simona Iammarino, Professor of Economic Geography, Department of Geography and Environment, London School of Economics
Micro-geography of Interactions in the City: Interaction Patterns of KIBS in Montreal
February 23, 2023 | 4:00PM - 6:00PM, In-person, 108N North House, Munk School, 1 Devonshire Place, Toronto ON
David Doloreux, Professor, Department of International Business and Chair in Innovation and Regional Development, HEC Montreal
Anthony Frigon, Assistant Professor, Department of International Business, HEC Montreal
Evidence use in State policymaking: A bibliometric analysis of two consequential policy areas
March 9, 2023 | 4:00PM - 6:00PM, In-person, Boardroom at the Munk School, 315 Bloor Street West, Toronto, ON.
Kimberley R. Isett, Professor, Joseph R. Biden, Jr. School of Public Policy and Administration, University of Delaware
U of T Public Policy Reports Collection
The Division of the Vice-President, Research and Innovation (VPRI) and the University of Toronto Libraries (UTL) have issued a call for submissions to U of T’s Public Policy Reports Collection on TSpace. This unique collaboration promotes public policy-related working papers authored by the U of T community and hosted on TSpace, a free and secure research repository. The collection provides permanent URLs on a high-traffic platform, enabling timely research to be available sooner than through traditional scholarly publication channels. Submit current and past policy reports here.
Meeting its Waterloo? Recycling in entrepreneurial ecosystems after anchor firm collapse
Ben Spigel & Tara Vinodrai, Entrepreneurship & Regional Development
This article was co-authored by IPL affiliated faculty member Tara Vinodrai and was recently awarded the Best Paper Award for 2021 by the Editorial Board of Entrepreneurship & Regional Development. Abstract: The ‘recycling’ of people, capital, and ideas within an entrepreneurial ecosystem is a key process driving high-growth entrepreneurship. Skilled workers who leave firms after successful exits or firm collapse bring knowledge and insights that they can use to start new ventures or work at existing scale-up firms. This makes large anchor firms important actors in attracting workers who may subsequently recycle into the local ecosystem. However, there is limited empirical research on recycling into an ecosystem after the loss of an anchor firm. This paper develops a novel methodology using career history data to track recycling into ecosystems. The paper develops a study of Waterloo, Ontario, home to the smartphone manufacturer Blackberry, whose decline in 2008 represented a significant shock to the local entrepreneurial ecosystem. We find that alumni of this firm engaged in very little high-growth entrepreneurship, instead entering the ecosystem as technology employees at high-growth scale-up firms. This was aided by the region's increased institutional capacity to match skilled workers with new ventures, ensuring the continued success of the ecosystem over time. These findings provide a more nuanced understanding of the role of anchor firms in entrepreneurial ecosystems and how recycling affects the dynamics of entrepreneurial ecosystems.
Planning for the cultural economy: lessons from Ontario, Canada
Tara Vinodrai, Brenton Nader, & Nicole Drake, Planning Practice & Research
This paper examines how policymakers interpret and deploy cultural economy approaches within municipal economic development strategies and cultural plans. Focusing on the 33 largest municipalities in Ontario, Canada, we conduct a keyword analysis of 63 municipal planning documents, supplemented with key informant interviews with economic development and cultural planning staff. Our analysis reveals that the use of cultural economy approaches in economic development and cultural plans varies depending upon city size, municipal governance structure and municipal organizational structure. However, despite the widespread use of cultural economy ideas in planning documents, we conclude that its uptake in municipal policymaking fails to reflect its professional and scholarly popularity.
Visualizing the Impact of COVID-19 on Toronto
This article takes stock of the COVID-19 pandemic’s impacts on Toronto. The article notes that the examination of policy measures and pandemic-related metrics, in combination with data visualization, can shed light on our past, inform decisions about managing in the present, and help guide us to a more resilient future. As we plan for Toronto’s recovery and future, we need to prioritize data. Access to data, understanding of what datasets do and do not represent, and the resources needed to obtain, interpret and share data publicly are critical components in the creation of an adaptive and resilient city.
Skills development for innovation and growth: Insights from global initiatives
Daniel Munro & Creig Lamb, Future Skills Centre
Canada’s innovation economy faces a dual challenge. Firms that want to innovate and grow often struggle to find workers with the right skills and knowledge, while many workers have difficulty finding and participating in education and training initiatives that would help them develop the skills and knowledge they need. Some firms address the challenge by working with training institutions to reskill their current workforce or develop programs to ensure that new hires have relevant skills and knowledge. Yet, too few pursue this strategy. The result is missed opportunities and foregone growth in the innovation economy. This report and accompanying case studies share insights from three skills for innovation training initiatives which can inform the design and operation of models in Canada. As this briefing and the case studies reveal, well-designed and operated skills for innovation initiatives can improve the skills and well-being of workers and the strength and growth of dynamic regional economic sectors.
Stress-Free Degree Lectures on Demand
IPL Co-Director David Wolfe contributed a lecture for the Stress-Free Degree Lectures series, provided by the Alumni Relations team of the Division of University Advancement. Catch up on timely topics this holiday season at lectures by bold U of T thinkers. No cost. No homework. A long-standing highlight of U of T’s annual Alumni Reunion, our Stress-Free Degree Lectures are available exclusively for U of T alumni. Watch the 2022 lineup for a limited time. Lectures available December 19, 2022 to January 19, 2023 only. Register today for exclusive access.
Hydrogen patents for a clean energy future: A global trend analysis of innovation along hydrogen value chains
International Energy Agency
Making low-emission hydrogen cost-competitive will not be possible without technology improvements across a value chain that touches nearly every part of the energy system. This study, which combines the expertise of the International Energy Agency and the European Patent Office, is the most comprehensive, global and up-to-date investigation of hydrogen-related patenting so far. Uniquely, it covers technologies for the full range of hydrogen supply, storage, distribution, transformation and end-user applications, as well as introducing new search strategies to compare incremental innovation related to established fossil fuel processes with emerging technologies motivated by the climate challenge.
Cities & Regions
Breaking down an $80 billion surge in place-based industrial policy
Mark Muro, Robert Maxim, Joseph Parilla, and Xavier de Souza Briggs, Brookings
This article summarizes the nearly $80 billion in place-based industrial policy passed by the 117th Congress via the American Rescue Plan Act (ARP), Infrastructure Investment and Jobs Act (IIJA), CHIPS and Science Act, and Inflation Reduction Act (IRA). After years of growing regional divides and uneven economic progress across places, the federal government is finally experimenting with large-scale, direct investments in underdeveloped places and regions. These place-based policies also seek to advance national goals such as strengthening domestic supply chains, promoting international economic competitiveness, and mitigating the impacts of climate change. Given that, it’s worth assessing the how and why, after a long time in obscurity, place-based programs are now seeing a resurgence. This analysis underscores that the US has arrived at a significant juncture in economic policy.
Reconsidering actor roles in regional innovation systems: transformative industrial change in the forest-based bioeconomy
Hanna Martin, Ida Grundel & Margareta Dahlström, Regional Studies
This paper reconsiders the roles of actors in regional innovation systems in the context of transformative industrial change. Empirically, it draws on evidence from the Värmland region of Sweden, where regional innovation system actors, with partial funding from the Swedish Innovation Agency, are striving to build a bioeconomy upon the traditional forest-related industries. The main findings include that transformative industrial change adds a variety of responsibilities to regional actors, including the provision of change legitimacy, influencing the industry’s innovation directionality and achieving social acceptance for change. A combined perspective on socio-technical transitions and path development in regional innovation systems theoretically informs the case.
Business innovation and growth support, 2020
In partnership with the Treasury Board Secretariat, Statistics Canada produces information about the impact of these programs on their recipients via the Business Innovation and Growth Support initiative (BIGS). A total of 123 federal programs related to business innovation and growth are included in this database, which is now available for the 2020 reference year. In 2020, small- and medium-sized enterprises accounted for 95.8% of all enterprises who obtained federal support from various innovation and growth support programs. These enterprises also received close to three-quarters of the total amount distributed from these programs. In comparison, larger enterprises with 500 or more employees accounted for 4.2% of the BIGS 2020 support recipients. Nevertheless, large enterprises received 26.0% of the total amount given via these programs of support.
Global Innovation Index 2022: What is the future of innovation-driven growth?
World Intellectual Property Organization
The 2022 edition of the Global Innovation Index (GII) tracks the most recent global innovation trends against the background of an ongoing COVID-19 pandemic, slowing productivity growth and other evolving challenges. It identifies the most innovative economies in the world, ranking the innovation performance of around 132 economies while highlighting innovation strengths and weaknesses.
A collective response to our global challenges: a common good and ‘market-shaping’ approach"
Mariana Mazzucato, UCL Institute for Innovation and Public Purpose Working Paper Series
To effectively address the grand challenges of our time, we cannot simply tinker around the edges by fixing market failures. We must actively shape markets to deliver on the objective of generating more sustainable and inclusive growth. This paper argues that an objective-oriented economy requires a market-shaping approach; one that accompanies the concept of the public good with the common good framing that is needed to design the interface for this collaboration. This is about structuring the conditions and governance mechanisms that shape the capabilities, tools, institutions and partnerships needed to take concrete action. Building collective intelligence into these dimensions ex-ante is essential for maximising public value for all actors involved. This paper sets out how a market-shaping and common good framing can be conceptualised and brought together. Importantly, missions can be used to orient and coordinate policies, institutions, innovation and investments around clear, ambitious and measurable goals. Further, this paper addresses the implications for key global challenges, from climate change to pandemics.
Promoting innovation: The differential impact of R&D subsidies
Reda Cherif , Fuad Hasanov , Wolfgang Sofka , & Christoph Grimpe , Bennet Institute for Public Policy Cambridge
In this working paper, the authors investigate the effect of Research & Development (R&D) subsidies on firms’ innovation by ownership, industry, and firm size using German firm-level data. The impact of R&D subsidies is heterogeneous across industries for multinational corporations (MNCs) and domestic firms while it does not differ substantially by firm size. Domestic firms have a larger response in R&D spending in low-tech manufacturing, knowledge-intensive services, and technological services while the response of domestic and foreign multinational companies (MNC) is broadly similar and is greater in medium-tech and high-tech manufacturing. Foreign MNC subsidiaries’ response in terms of patents is greater than that of domestic MNCs in most industries.
Science and innovation policy for hard times: an overview of the UK’s Research and Development landscape
Richard A. L. Jones, The Productivity Institute
The UK is the mid-term of a government that has placed a lot of emphasis on science and innovation for the future of the country. There has been a lot of rhetorical ambition, and some snappy slogans (“science superpower”, “innovation nation”). There has also been a lot of change in the way the nation’s science system is wired up, and much of that change is yet to work through. This paper is an overview of where this process of change has got to, and what is yet to evolve. The report’s sections discuss the following 9 themes:
1. The wider challenges the UK government faces, asking what problems need science and innovation system to contribute to solving
The UK’s poor productivity growth is linked with its poor innovation performance. The report notes that “it is striking that the UK’s decline in productivity growth [since 2008] follows a period in which the overall R&D intensity of the UK economy declined substantially, and that the UK’s weak performance in productivity growth compared to international comparator countries is correlated with comparatively low R&D intensity.”
The policy context is further complicated due to challenges associated with managing the transition to a net-zero economy, navigating rising geopolitical security threats, and financing the increased healthcare costs of an aging population.
2. How the UK’s science and innovation system works
In 2019, total spending on R&D was £38.5 billion. The largest single contribution to this was from business, which spent £20.7 billion, mostly on R&D carried out in the business sector. The government spent £10.4 billion, including £1.8 billion to support R&D in industry, £6 billion on university R&D, and £2.3 billion in its own laboratories.
In 2019, the UK’s R&D intensity – as measured by the fraction of total GDP spent on R&D, both public and private – stood at a little less than 1.8%. The government has a stated policy of increasing R&D intensity to 2.4% of GDP (the OECD average) by 2027.
Business R&D is concentrated in a few sectors of the economy and is carried out by big businesses. In 2020, total business R&D was reported as £27 b; of this just £1.5 b happened in SMEs.
3. The history and future of the UK’s Research and Development (R&D) system
Policy choices in the period from 1980 to 2010 prompted a systematic shift of UK government supported R&D from government applied research to “curiosity driven” research in higher education.
In addition to overall low level of R&D, the UK is an international outlier in the degree to which non-business R&D is concentrated in universities, with a much lower proportion in non-university government laboratories.
Most business R&D is done by large, multinational companies (around half of it is done by overseas-owned companies)
4. Science priorities – who decides?
The report notes that “the government asserted much more direct control over the research system in the 2017 Higher Education and Research Act”, which incorporated all seven research councils into a single organisation, UK Research and Innovation (UKRI). Section 102 of the Act states, “The Secretary of State may give UKRI directions about the allocation or expenditure by UKRI of grants received...”
5. Government support for Business R&D through the tax system
R&D tax credits “increased dramatically in recent years” from £1.1 billion in 2010 to £7.4 billion in FY 19/20, due to increased generosity and take-up by business. The report estimates, putting together the cost of tax credits and direct government funding of industry research, that roughly 35% of business spending on R&D is paid for by the state.
The report asserts that “supporting business R&D [via tax credits] means there’s no need for the government to make any decisions about what kind of R&D to support; there’s no danger of being accused of trying to ‘pick winners’. This means that the scheme is very cheap to administer, and there is no need for the government agencies to have any specialist expertise or to develop a strategy.”
6. UK Research and Innovation and the agencies that allocate R&D money on behalf of the government
R&D funding system has seen substantial changes over the last few years, with the introduction of a new agency, UK Research and Innovation (UKRI), in 2018, and will see yet more in coming years, for example through the new agency, the Advanced Research and Innovation Agency (ARIA). The future of the UK’s association with the European Union research funding programme, Horizon Europe, also remains in question.
7. The other UK R&D investment channel: Government and Departmental Research
Despite austerity-era declines in R&D spending between 2010-2015 in Transport and environment departments, significant R&D spenders include departmental spenders remain Defence (2020-21 R&D budget of £1.1 b) and health (£1.1 b in 2019-20) and Health.
The £1 billion 2020 R&D budget of Business, Energy and Industrial Strategy (BEIS), excluding UKRI, funds labs and the 2017 industrial strategy R&D ‘sector deals’. However, this “approach seems to be in doubt now; the 2017 Industrial Strategy was superseded in 2021 by a new, HM Treasury driven, Plan for Growth, which turned away from so-called “vertical” strategy focused on specific sectors”
8. The UK’s future in the Horizon Europe research programme, and the potential of the new agency, ARIA
This section summarizes developments in “the two most uncertain areas of UK government-funded R&D” - the future of the UK’s participation in the EU Horizon programme and the new agency ARIA, the Advanced Research and Invention Agency, set up by Act of Parliament in early 2022, and currently just establishing itself.
9. Science and innovation policy for hard times: understanding the UK’s place in the world
Is the UK a “science superpower?” While the UK outperforms peers in academic impact, the author notes that based on scientific inputs and industrial impact, it is most appropriate to “think of the UK is a large Canada, not a small USA.”
With less than 3% of the world’s R&D resources, the UK must be selective in the strategic choices it makes about research priorities. The country needs a coherent industrial strategy that is coordinated across departments and with regional governments, since “in the absence of a well-articulated strategy from central government, agencies such as research councils and Innovate UK guess what they think the national strategy ought to be and create programmes in support of that guess.”
Links to recent IPL webinars
The Politics of Decarbonization
Munk School of Global Affairs & Public Policy
The transition to a post-carbon energy and economic paradigm is a stated priority for all the signatories to the Paris Accord, including Canada. Success in achieving this objective will depend on a complex mix of policy experimentation and coalition building in support of that objective, cutting across virtually every sector of the economy. This panel will explore some of the dimensions of that process and the prospects for success in achieving that objective.
Moderator: David A. Wolfe is Professor of Political Science at the University of Toronto Mississauga and Co-Director of the Innovation Policy Lab at the Munk School of Global Affairs and Public Policy.
Brendan Haley is Policy Research Director at Efficiency Canada, a research and advocacy organization based at Carleton University. He has a PhD in Public Policy from Carleton University and was awarded a Banting postdoctoral fellowship where his work examined Canadian energy transitions from political economy and technological innovation perspectives.
Sara Hastings-Simon is macro energy system researcher and Assistant Professor in the Department of Physics and Astronomy and School of Public Policy at the University of Calgary where she directs the Masters of Science in Sustainable Energy Development.
Nathan Lemphers is an Adjunct Professor in the Department of Political Science at the University of Waterloo and former Postdoctoral Fellow at the Smart Prosperity Institute where he researched the regional political economy of electric vehicles. Sponsored by the Innovation Policy Lab at the Munk School of Global Affairs & Public Policy
National Governments & Innovation Policy: Where – and What – Is Utopia?
This is a recording of a January 10 panel focused on national governments and Innovation policy. Canada, the Nordics, Taiwan? In this webinar, panelists examined the diverse roles played by national governments in setting the stage for innovation, as well as the key elements that ought to be considered in formulation of innovation policy in Canada and elsewhere.
Susana Borras, Professor, Department of Organization, Copenhagen Business School, Copenhagen Denmark
Dan Breznitz, University Professor and Munk Chair of Innovation Studies; Co-Director, Innovation Policy Lab, Munk School; Clifford Clark Visiting Economist, Department of Finance, Government of Canada
Darius Ornston, Associate Professor, Munk School
Joseph Wong, Vice-President, International, University of Toronto; Roz and Ralph Halbert Professor of Innovation, Munk School; Professor, Department of Political Science
Rana Foroohar, Global Business Columnist and Associate Editor, Financial Times, and Global Economic Analyst, CNN
16th Workshop on The Organisation, Economics and Policy of Scientific Research
13 – 14 April 2023
The Max Planck Institute for Innovation and Competition and TUM are organising the annual workshop “The Organisation, Economics and Policy of Scientific Research” at the Max Planck Institute for Innovation and Competition in Munich. We aim to attract contributions from both junior and senior scholars on topics related to the organisation, economics and policy of scientific research. A minimum number of slots are reserved for junior researchers (PhD students or postdoc scholars who obtained their PhD in 2020 or later). Please submit previously unpublished papers or extended abstracts (min 3 pages) by 15 January 2023. We strive to notify authors by 27 February 2023.
Atlanta Conference on Science and Innovation Policy
May 24-26, 2023, Georgia Institute of Technology Global Learning Center, Atlanta
The Atlanta Conference on Science and Innovation Policy provides a showcase for the highest quality scholarship from around the world addressing the challenges and characteristics of science and innovation policy and processes.
June 27 to 29, 2023, Toronto
The 6th International Conference on Public Policy (ICPP6) is coming to Toronto! Organized by IPPA, ICPP6 is hosted by the Toronto Metropolitan University's Faculty of Arts and Public Policy graduate studies programs and will take place at the University's premises in downtown Toronto from June 27 to 29, 2023, with a Pre-Conference on June 26. This conference includes a panel chaired by IPL Co-director Dan Breznitz called "Organizational Evolution in Innovation Policy." See here for submission instructions. The paper submission deadline is Jan. 31, 2023.
Research professional (French & English speaking and writing are required) under the responsibility of the Innovation Chair and 4POINT0 in Catherine Beaudry's team. They are looking for a PhD student, a graduate student, a post-doc or others who can mainly coordinate student research projects and write grant proposals. They strongly advise you to contact them for the terms of the job offer. Deadline 30th January.
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This newsletter is prepared by Travis Southin.
Project manager is David A. Wolfe