The IPL newsletter: Volume 25, Issue 510

August 15, 2024

News from the IPL

RESEARCH

Semi-Peripheral Pathways to High-Technology Markets: How Organizational Origins Shape Entrepreneurial Ecosystems

Alessandra Cicci & Darius Ornston, Studies in Comparative International Development
This article is co-authored by IPL Affiliated Faculty Darius Ornstonand Master of Global Affairs alumni Alessandra Cicci. Recent technological changes have created new opportunities for small- and medium-sized firms in the semi-periphery to enter digital markets. At the same time, the need to connect startups with the diverse range of actors and resources which sustain an entrepreneurial ecosystem poses a formidable challenge to regions which have historically suffered from disarticulation. The literature suggests that regions aspiring to support technology startups could benefit from bridging organizations or “entrepreneurial ecosystem incubators” (EEIs) to build civic capital. Comparing two successful EEIs in Toronto and Waterloo, Canada, we find that their organizational structure, specifically the composition of their board, shaped connectivity in important ways. Whereas Communitech, an entrepreneur-led EEI in Waterloo, relied heavily on horizontal, peer-to-peer mentoring among entrepreneurs, MaRS, led by established firms and civic leaders, linked startups to external capital, customers, and other resources within a limited number of industry verticals. Both EEIs supported local startup activity, but they fostered different patterns of collaboration and high-technology competition. This analysis suggests that regional leaders in laggard regions may face a tradeoff in how they support technology startups and nurture entrepreneurial ecosystems.

Chip Shot: A Semiconductor Strategy for Canada

Canadian Standards Association
This report was co-authored by IPL Associate Dan Munro. With the semiconductor industry in the midst of technological, geopolitical, and economic change, firms and governments in the United States, China, Europe, India, and elsewhere are making multi-billion-dollar investments to generate and secure advantages. Canada has strengths that could be enhanced with strategic investment. Yet, the inertia that plagues much of the Canadian innovation ecosystem also seems to affect the semiconductor sector. Canada has been slow to act. Canada should focus its semiconductor strategy on better integration with global value chains rather than self-sufficiency. For Canada to be successful in key sectors of the industry, firms and governments should increase funding for research and development, commercialization, and intellectual property protection; develop stronger programs for semiconductor start-ups and scale-ups; enhance semiconductor innovation infrastructure; improve education and career pathways for highly skilled personnel; and strengthen partnerships with major actors in global value chains, especially the United States.

Editor's Pick

The Canadian Battery Innovation Roadmap

Accelerate
Canada, with its legacy of innovation and substantial investments in cell production, is uniquely positioned to be a global battery technology leader. Accelerate in partnership with Natural Resources Canada and the Ivey foundation has launched The Battery Innovation Roadmap, a comprehensive document which outlines a strategy to establish Canada as a global leader in battery technology by 2035. It offers an in-depth analysis of Canada's current position in the global battery landscape and details key actions needed to build a thriving battery ecosystem. The roadmap addresses critical areas including innovation infrastructure, industrial policy, and skills development. It is designed to guide policymakers, industry leaders, and researchers in collaborative efforts to maximize Canada's potential in the rapidly evolving battery sector. This document serves as a blueprint for enhancing Canada's competitiveness, fostering innovation, and contributing to the global clean energy transition. Complimenting the report is a comprehensive online roadmap tool, designed to help navigate key battery innovation policies. This interactive tool empowers policymakers with actionable insights and strategic guidance to drive Canada’s leadership in battery technology. The roadmap was authored by Moe Kabbara, Bentley Allan, and Travis Southin.

Cities & Regions

Missions, conditions and the policy transfer of Smart Specialisation in the European Union

Charles Abbott & Rune Dahl Fitjar, Regional Studies
Smart Specialisation is fundamentally a bottom-up policymaking process premised on entrepreneurial discovery and peer learning. Nonetheless, the European Union has relied on coercive policy transfer through the ex-ante funding conditionality instrument to secure its implementation across regions. This paper examines how the use of conditionality has shaped the implementation of Smart Specialisation in the European Union and its regions. Furthermore, it discusses whether the use of conditionality to ensure the implementation of a particular type of innovation policy reflects a changed perception of the role of the state in the broader European integration project.

Statistics

The State of U.S. Science and Engineering 2024

U.S. National Science Foundation
The National Science Board (Board, NSB) is required under the National Science Foundation (NSF) Act, 42 U.S.C. § 1863 (j) (1) to prepare the biennial Science and Engineering Indicators (Indicators) report for and transmit it to the president and Congress every even-numbered year. The report is prepared by the National Center for Science and Engineering Statistics (NCSES) within NSF under the guidance of the Board. Indicators provides information on the state of the U.S. science and engineering (S&E) enterprise over time and within a global context. The report is a policy-relevant, policy-neutral source of high-quality U.S. and international data. The indicators presented in the report are quantitative representations relevant to the scope, quality, and vitality of the S&E enterprise. This summary report, The State of U.S. Science and Engineering, details key findings from the nine thematic reports that make up Indicators, providing in-depth data and information on science, technology, engineering, and mathematics (STEM) education at all degree levels; the STEM workforce; public perceptions and awareness of science and technology; U.S. and international research and development performance; invention, knowledge transfer, and innovation; and U.S. competitiveness in high-technology industries. Indicators also includes an interactive, online tool that enables state comparisons on a variety of S&E indicators.

Understanding Canada’s innovation paradox: Exploring linkages between innovation, technology adoption and productivity

Guy Gellatly and Wulong Gu, Statistics Canada
This Spotlight is a complement to a new presentation Research to Insights: Challenges and Opportunities in Innovation, Technology Adoption and Productivity, highlighting key findings from the agency’s productivity research program and recent business surveys. It also explores the relationship between competitive intensity and innovation and informs on the pace at which disruptive technologies, such as artificial intelligence, are being integrated into the economy. Increases in labour productivity are integral to long run improvements in living standards. Since the early 1980s, growth in labour productivity has accounted for over 90% of the growth in Canada’s real gross domestic product (GDP) per capita while the remainder has come from growth in labour utilisation. While declines in per capita output since mid-2022 have reflected near-record population increases, labour productivity has also trended lower, decreasing in six of the past eight quarters. Business labour productivity in early 2024 was below levels observed just before the COVID-19 pandemic.

Innovation Policy

Technology Transfer Execution Plan

U.S. Department of Energy Office of Technology Transitions
The U.S. Department of Energy (DOE) plays a key role in moving innovative technologies developed by the National Laboratories, plants, and sites and the extramural research community into the commercial marketplace. It is imperative that DOE’s technology transfer and commercialization activities help maximize the returns on the taxpayer’s investments. This goal is further underscored by the unprecedented investments to commercialize clean energy technologies by advancement across the research, development, demonstration, and deployment continuum provided through the Bipartisan Infrastructure Law and the Inflation Reduction Act. In support of these goals, the Technology Transfer Execution Plan outlines a strategic framework to support Department-wide coordination of technology transfer and commercialization activities. 

Mapping the Junction of Digital-Green Skills for the Twin Transition: A Competency Framework

ICTC
This research unravels in-demand digital-green skills in Canada. First, it investigates employment opportunities and skills needs at the intersection of the digital-green economies and maps central components of the digital-green economy. Then, it disentangles the evolving labour market, including labour market shifts and transferable skills as digital-green skills become increasingly needed across all sectors. It concludes by highlighting emerging and future roles that will specialize in digital-green activities. Importantly, this analysis clarifies that the twin transition will impact the entire economy, requiring workers across occupations to upskill. As emphasized by research participants, including employers and subject matter experts, digital-green skills are already being layered onto existing jobs. To shape this analysis, ICTC conducted an employer survey, key informant interviews with employers and subject matter experts, and completed a literature review, including a comprehensive review of existing skills and competency frameworks for the digital and green economies.

Ottawa abruptly ended $4-billion program for small businesses over budget cuts, not demand, documents show

Chris Hannay, Globe and Mail
The Canada Digital Adoption Program (CDAP) was first announced in the 2021 budget and was touted as a centrepiece of the government’s efforts to help businesses emerge stronger from the depths of the COVID-19 pandemic. It launched the next year with a suite of different funding options, including $2,400 microgrants for website creation; $15,000 grants to hire digital consultants to create business plans; and interest-free loans of up to $100,000 to support technology upgrades. It was budgeted to run for four years. Last February, the government abruptly ended the grant and loan portion of the program – which was the bulk of CDAP’s budget – and posted a notice on its website that the program was ending because it was a success and it was “fully subscribed.” (The microgrant stream is continuing to accept applications until Sept. 30.) Although the government did not say so publicly at the time, the budget was used up because it had been sharply reduced, according to internal documents obtained under access to information law.

How Innovative Is China in the Electric Vehicle and Battery Industries?

ITIF
China is at the global forefront of the electric vehicle (EV) and EV battery industries. Its firms produce nearly two-thirds of the world’s EVs and more than three-quarters of EV batteries. They also have produced notable innovations in EV products, processes, and customer experiences. To assess how innovative Chinese enterprises and industries are, the Smith Richardson Foundation provided support to the Information Technology and Innovation Foundation (ITIF) to research the question. As part of this research, ITIF is focusing on particular sectors, including EVs and their batteries. ITIF relied on three methods to assess Chinese innovation in EVs and EV batteries. First, the authors conducted in-depth case study evaluations of two Chinese EV companies randomly selected from EV companies listed on the “2023 EU Industrial R&D Investment Scoreboard.” Second, the authors conducted interviews and held a focus group roundtable with global experts (to whom we offered anonymous participation) on the Chinese EV industry. And third, the authors assessed global data on EV innovation, including scientific articles and patents.

Policy Digest

TIP Roadmap: An Investment Strategy for U.S. National Science Foundation's Directorate for Technology, Innovation, and Partnerships

U.S. National Science Foundation
Pursuant to section 10399 of the “CHIPS and Science Act of 2022,” this roadmap sets out the strategic vision for the TIP directorate that will guide its initial investment decisions, outlining the directorate's strategic vision that will, in turn, guide initial investment decisions focused on advancing U.S. competitiveness in key technology areas. The report details how the directorate will increase funding for research and education for populations and geographic areas underrepresented in science, technology, engineering, and mathematics and protect federally funded science and technology. Development of the roadmap was informed by: existing national strategies and guidance in each of the key technology focus areas and societal, national, and geostrategic challenge areas enumerated in section 10387 of the “CHIPS and Science Act of 2022”,  feedback from the public in response to a request for information; analysis of open source data and investment trends; and consultations with subject matter experts. The roadmap will be updated – in consultation with relevant federal
counterparts – every three years.

Background

The CHIPS and Science Act of 2022 established within the U.S. National Science Foundation (NSF) the Directorate for Technology, Innovation and
Partnerships (TIP) to “advance research and development, technology development, and related solutions to address United States societal, national, and geostrategic challenges, for the benefit of all Americans.” The legislation further specified that the directorate should:

  • Support use-inspired and translational research and accelerate the development and use of federally funded research;

  • Strengthen United States competitiveness by accelerating the development of key technologies;

  • Grow the domestic workforce in key technology focus areas and expand the participation of United States students and researchers in areas of societal, national, and geostrategic importance, at all levels of education.

Four Near-Term Investment Areas

While the CHIPS and Science Act articulated 10 technology focus areas, the documents notes that "as current budget levels constrain the ability of TIP to significantly advance U.S. competitiveness in all 10 focus areas concurrently, the TIP Roadmap sets out a framework for the directorate to stage investments in the key technology areas for optimal effects on U.S. competitiveness." As such, in the coming three-year window, TIP will focus on cultivating targeted investments to increase U.S. competitiveness in four primary key technology areas:

  • Artificial intelligence (AI), machine learning, autonomy, & related advances

  • Biotechnology, medical technology, genomics, & synthetic biology

  • Advanced communications technology & immersive technology

  • Data storage, data management, distributed ledger technologies, & cybersecurity, including biometrics

To arrive at these four primary near-term focus areas, TIP leveraged a macro-risk analysis to identify key technology areas that most urgently require acceleration to enhance U.S. competitiveness and integrated that assessment with an identification of the opportunities or vulnerabilities that the TIP directorate’s use-inspired and translational research and development funding mechanisms would be best positioned to address.

Events

EVENTS

September 11-13, 2024, Brussels, Belgium
The conference theme is 'Blurring Boundaries and Ambiguous Roles: Universities and the Entrepreneurial Ecosystem.' The deadline for abstract submissions is February 15, 2024.

WICK#12 PhD Workshop in Economics of Innovation, Complexity and Knowledge

December 12-13 2024, Turin
Annual meeting for doctoral students and young researchers in Economics of Innovation, Complexity and Knowledge. The Workshop is organized by the students of the Vilfredo Pareto Doctoral Program in Economics, in collaboration with the University of Turin, BRICK, Collegio Carlo Alberto and Young Scholar Initiative

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This newsletter is prepared by Travis Southin.
Project manager is David A. Wolfe