SSTI
This post summarizes a recent memo by the U.S. Office of Management and Budget and the Office of Science and Technology Policy that outlines this year’s R&D priorities. Federal science agencies will use this memo to design their budget requests for the fiscal year 2025. For the first time, this annual memo references regional innovation as an important element of R&D. The memo mentions regional innovation under the priority, “Reduce barriers and inequalities.” This priority directs agencies to “undertake R&D and apply technology advances to ameliorate inequities and create opportunity in ways that strengthen our values.”
News from the IPL
Why Is It So Hard for Scholars to Launch Startups?
Wired
IPL Affiliated Faculty Member Shiri Breznitz contributes to this article. This article summarizes how STEM scholars with startup dreams struggle to find support. A new type of professorship may be the solution. While existing support structures work reasonably well for faculty members dabbling in innovation, there is no long-term road map for more involved scholar-entrepreneurs, forcing many early-career scholars to eventually choose between one or the other.
RESEARCH
Cities, COVID-19, and counting
Tara Vinodrai & Shauna Brail, Big Data & Society
The COVID-19 pandemic had immediate and potentially long-lasting impacts on cities. Yet, the ability to assess, monitor, and analyze the wide-ranging effects of the pandemic has been stymied by data challenges. The pandemic elevated the need for, and reliance on, a wide range of data sources. The authors discuss four data challenges related to understanding the impact of the pandemic on cities. First, they explore how shifts in public policy and the decisions of private companies altered data collection priorities, availability, and reliability. Second, they discuss temporal dimensions, including the speed of data retrieval and frequency of data collection. Third, they identify the growing use of unexpected sources, which often feature a lack of rigor and consistency. Fourth, they explore the spatial scale of study and highlight questions about the interpretation of boundaries constituting the city. The authors use examples from the City of Toronto to ground their observations while also pointing to broader issues. They note that the tension between rapid, novel data and slow, consistent data continues to evolve and argue that a deeper appreciation and analysis of, and access to, myriad sources of data are necessary to understand the immediate and long-term impacts of COVID-19 on cities. Beyond the pandemic, the essay contributes to ongoing and emerging debates regarding the use of big data to understand the challenges facing cities and society.
Frontier workers and the seedbeds of inequality and prosperity
Dylan Shane Connor, Tom Kemeny, Michael Storper, Journal of Economic Geography
This article examines the role of work at the cutting of technological change—frontier work—as a driver of prosperity and spatial income inequality. Using new methods and data, the authors analyze the geography and incomes of frontier workers from 1880 to 2019. Initially, frontier work is concentrated in a set of ‘seedbed’ locations, contributing to rising spatial inequality through powerful localized wage premiums. As technologies mature, the economic distinctiveness of frontier work diminishes, as ultimately happened to cities like Manchester and Detroit. This work uncovers a plausible general origin story of the unfolding of spatial income inequality. View the ungated preprint here.
Shauna Brail, Journal of Planning Education and Research
This article examines the redevelopment of Toronto’s Regent Park, a neighborhood formerly comprised exclusively of public housing. Since 2006, it has been undergoing a transformation into a mixed income neighborhood. Through interviews and document analysis, the paper traces the complex and changing development agreements as redevelopment progresses, highlighting the state’s entrepreneurial efforts and the dynamic nature of urban planning and policy. The authors find that practices of financializing public land are highly fluid, and that efforts to derive public value from public housing redevelopment are tied to shifting community expectations regarding the return of benefits to residents.
Editor's Pick
Philip McCann, Regional Studies
The paper argues that the UK’s endemic regional–national productivity problems cannot be addressed by the UK’s current institutional and governance set-up. This paper argues that the establishment of an appropriate institution, body or forum is essential in order to fill the current governance vacuum. The appropriate nature, form and logic of such a body can be gleaned by observing various international comparator bodies which undertake different aspects of the types of roles and tasks that a UK body must necessarily undertake. The options for a UK body comprising elements of these comparator institutions are discussed in detail.
Cities & Regions
White House R&D priorities include new focus on regional innovation; other priorities slightly shift
Statistics
Climate Data Requirements, Gaps, and Challenges to Support Climate-Related Financial Disclosures
Anik Islam, Colleen Kaiser and Marena Winstanley, Smart Prosperity Institute
High-quality, transparent, reliable, and comparable climate-related financial disclosures are essential to advance sustainable finance. This report analyzes gaps and challenges in the available data for climate-related financial disclosures in Canada. The report, undertaken in conjunction with members of the Sustainable Finance Action Council (SFAC), focuses on the data use-case of climate-related financial disclosures. The report identifies priority climate data requirements, analyzes barriers, and challenges to disclosures and informs ongoing discussions and knowledge mobilizing in addressing this issue. Based on consultations with SFAC members and analysis of best practices, the report identifies five types of quantitative disclosures that need to be prioritized to support overall climate-related financial disclosures.
The US climate law is fueling a factory frenzy. Here’s the latest tally
Dan McCarthy, Maria Virginia Olano, Canary Media
In just 12 months, Biden’s Inflation Reduction Act has spurred more than 100 new cleantech manufacturing announcements and nearly $80B in private investment. This post provides a map of investments by sector. This resource is part of a special series where Canary Media takes stock of the IRA's impact so far.
Is there a trade-off between productivity and employment? A cross-country micro-to-macro study
Sara Calligaris, Flavio Calvino, Rudy Verlhac and Martin Reinhard, OECD
The impact of productivity on employment remains uncertain, particularly in light of growing concerns regarding potential negative effects of technological progress on labour demand. This report uses harmonised and comparable data from 13 countries spanning the last two decades to comprehensively analyse how productivity growth affects employment dynamics at various levels of aggregation. The study's findings highlight a positive correlation between productivity growth and employment as well as wage growth, both at the firm level and on a broader scale. This outcome arises from counteracting mechanisms and heterogeneous dynamics across different groups of firms. The findings have relevant policy implications: productivity is not just an isolated key economic objective, but well-designed and complementary policies can also help convert technological and organisational change into higher employment and wage growth.
Innovation Policy
The White House
This document summarizes the impact that the US Inflation Reduction Act has had since being signed into law on August 16, 2022. In terms of investment, the private sector has announced more than $110 billion in new clean energy manufacturing investments, including more than $70 billion in the electric vehicle (EV) supply chain and more than $10 billion in solar manufacturing. Since President Biden was elected, the private sector has announced approximately $240 billion in new clean energy manufacturing investments.The document notes that outside groups estimate the Inflation Reduction Act’s clean energy and climate provisions have created more than 170,000 clean energy jobs.
America’s Long, Tortured Journey to Build EV Batteries
Gabrielle Coppola, Bloomberg
This article traces the fall of startup A123, noting how it "reveals everything that’s wrong with America's approach to innovation." In the mid-1990s, a compound called lithium iron phosphate (LFP), the primary battery chemistry now used by CATL and most battery companies in China, was discovered by scientists at the University of Texas at Austin and commercialized a few years later by the startup A123 Systems LLC in Watertown, Massachusetts. In 2009, A123 was awarded hundreds of millions of dollars by the Barack Obama administration with the great hope that it would help kick-start production of electric cars in the US. But it was too early. There wasn’t demand for EVs, and car companies making vehicles that use less gas didn’t want to risk relying on an unproven startup. In 2013, China’s then-biggest auto parts company purchased A123 out of bankruptcy. That year the Chinese government also began implementing its plan to build a domestic EV market at a breathtaking pace. The article notes that "A123 is a case for tweaking the orthodox rules of American capitalism in the age of competition with China."
The Driverless Endgame: Policy and Regulation for Automated Driving
Hatch & Urban Robotics Foundation
Driving automation technology might reduce traffic congestion, improve fuel efficiency, and increase road safety by eliminating human error. This report asserts that governments are not ready to take advantage, because driving policy and regulation assumes there will always be a human behind the wheel. The authors examine the current state of automated driving regulation around the world and makes recommendations that policymakers globally can implement to promote innovation in this field, while also ensuring public safety and social acceptance of this new technology.
Policy Digest
Transformative innovation policy in practice in Austria, Finland and Sweden
Sylvia Schwaag Serger, Bernhard Dachs, Paula Kivimaa, David Lazarevic, Jani Lukkarinen, Lennart Stenberg and Matthias Weber, OECD
What do the Recovery and Resilience Plans tell us about linking transformation and innovation policy? Governments are increasingly utilising research and innovation (R&I) policy to foster economic and societal change. Yet, the empirical correlation between these policies and socio-technical transformations remains under-explored. The report investigates this relationship by comparing the Recovery and Resilience Plans (RRPs) of Austria, Finland and Sweden, initiated under the NextGenerationEU framework post Covid-19. The report finds significant disparities in the content, process and transformative value of the RRPs among these countries. The differences in the content of the national RRPs, and the ability and willingness to seize the opportunity presented by the RRPs to drive transformation, are explained by existing national policy contexts and frameworks. Surprisingly, the role of R&I policy in the RRPs is less important than expected, despite its emphasised importance in literature and political rhetoric. The report further identifies implications for a transformative innovation policy as well as areas for further research.
Factors explaining differences between the national RRPs:
1) The respective countries’ points of departure, regarding the level of development – e.g., the degree of digitalisation or green transformation in industry – but also national priorities;
2) RRPs do not exist in isolation, but complement existing policies, as well as the existing COVID-19-related measures. This means that the RRPs need to be understood in the wider strategic policy context, with regard to which they fulfil specific roles, such as patching certain gaps in the current portfolio of measures aiming to achieve specific transformations;
3) Domestic political and governance contexts play a role in the ability and willingness of countries to seize the opportunities presented by the RRPs;
4) Specific factors appear to have created more of a sense of urgency or inclination to seize the opportunity presented by the RRPs in Finland than in the other two countries;
5) Countries’ views of the RRF specifically, but also of the EU more generally, provide a fifth explanation for the differences in approaches to the RRPs.
The report then presents suggestions of how R&I policy might be designed, implemented and communicated:
• R&I policies have so far played an isolated role in the concert of policy fields. As societal challenges increasingly guide concerns of public policy, this isolated/autonomous role can no longer be sustained. To become more effective in supporting societal transformations, R&I policy needs to better connect with other policy fields, by giving new impulses, and better aligning with stronger sectoral policy and overarching political ambitions.
• R&I policy could play an important role in linking transitions which need to interact in a mutually beneficial way, but tend to be separated by policy silos, such as the green and digital transitions, and fulfil important coordination functions for transformation processes though mainly in the early phases of exploring novel systemic solutions.
• As shown by the RRPs, R&I policy can a play vital role in carving out experimental spaces for institutional change, which are needed to prepare farther reaching policy changes in sectoral and cross-cutting policy fields and across policy levels.
• There is no single best-practice model of how R&I policy can foster transformative change, but much depends on specific national institutional settings. However, if well embedded in a sound transformative policy framework, R&I policy can open up spaces for institutional and policy learning to redirect and properly utilise investments to support transformative change.
• Major horizontal policy programs, such as RRPs, are learning devices for transformation governance, but the learning and engagement should not be restricted to the policy space, but include also society, reaching out well beyond the range of stakeholders usually concerned with R&I policy matters.
• R&I policy as part of wider transformative policy packages should not restrict itself to a national and regional focus, but needs to explore complementarities in the European Research Area, as well as global opportunities for innovative and sustainable products and services.
• Existing technologies and solutions may provide quicker fixes for transformative ambitions (e.g. for reducing CO2-emissions by 2030), but novel R&I options (and policies) are crucial to prepare for the later phases of a transformative pathway, and to trigger the necessary (infra-)structural and institutional changes.
• The broader scope of transformative policies and their need for coordination requires a similar level and quality of cooperation at the operational levels of implementation by agencies and programs as it does at the conceptual level.
• While R&I policy plays an important role in enabling transformation and in creating spaces for experimentation with novel solutions, the extent to which it actually contributes to transformation depends critically on conditions and policies, which are often beyond the remit of traditional R&I policy
Links to recent IPL webinars
Does Canada have an effective innovation policy?
March 16, 2023 |11:00AM - 12:00PM, Online via Zoom
Since 2000 Canada has witnessed a proliferation of Innovation Strategies, including the 2017 Innovation and Skills Plan. Yet our innovation performance continued to deteriorate throughout this period. The 2022 Federal Budget began with the admission, “Our third pillar for growth is a plan to tackle the Achilles’ heel of the Canadian economy: productivity and innovation.” What factors best explain Canada’s dismal innovation performance over the past two decades? Join us for an IPL webinar with two of the most insightful analysts of Canadian innovation policy.
Moderator: David A. Wolfe, Professor of Political Science and Co-Director, Innovation Policy Lab
Panelists:
Shirley Anne Scharf, Ph.D. Shirley Anne Scharf is Visiting Researcher with the CN-Paul M. Tellier Chair on Business and Public Policy, Graduate School of Public and International Affairs, University of Ottawa and has her Ph.D. in Public Administration, School of Political Studies at U of O. Her dissertation, “Canadian Innovation Policy: The Continuing Challenge” (2022) examines the key dimensions driving the gap between policy intent and impact, and the consequences for Canada’s innovation eco-system.
Travis Southin, Ph.D. Travis Southin is a postdoctoral fellow at Carleton University’s School of Public Policy and Administration working with the Transition Accelerator on net-zero industrial policy. He completed his PhD in Political Science from the University of Toronto in 2022. His dissertation, titled “Overcoming Barriers to Policy Change: The Politics of Canada’s Innovation Policy,” illuminates the political barriers constraining the Government of Canada’s ability to shift its innovation policy mix away from neutral/horizontal policy instruments towards more targeted innovation policy instruments.
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This newsletter is prepared by Travis Southin.
Project manager is David A. Wolfe